Two carefully-watched microgrids took big steps forward April 6. The Schneider Electric microgrid was unveiled in Massachusetts, and Duke Energy won regulatory approval for its unusual Mount Sterling project in North Carolina.
The success of these projects brings good news to the young microgrid industry. But it is still not clear whether microgrids have leapt ‘the chasm’– a pivotal step in a disruptive technology’s market evolution, as described in Geoffrey’s Moore’s book, “Crossing the Chasm.”
Mark Feasel, a Schneider Electric vice president, said that the industry has advanced beyond the pioneer stage and is now accepted by early adopters. But it has yet to across the chasm to broad market acceptance – although others believe it’s on the brink, as more conservative funds begin investing.
Regulatory and technology obstructions are part of what holds microgrids back from the all-important market leap, according to Feasel.
On the technology side, Schneider is working on making microgrids more modular and scalable.
“You’ve got to remove complexity,” Feasel said in a meeting with analysts.“You can’t have 14 inverters and 15 disconnect panels and weird wires running everywhere.”
To that end, Schneider has designed a new Energy Control Center, which connects the facility’s distributed energy resources to the microgrid and provides advanced control.
Located at Schneider’s Boston One Campus, its North American headquarters, the microgrid also features the company’s newly released EcoStruxure Microgrid Advisor, which leverages connected hardware, software and cloud-based analytics to help the campus procure, manage and consume energy more efficiently.
The combination of advanced controls and demand side software allows the microgrid to leverage weather forecast data and other operational site data to optimize energy performance across onsite solar, energy storage, electric vehicle charging, building HVAC and natural gas generation assets.
“It’s the kind of thing that will allow us to make microgrids a little more transactional,” he said.
On the regulatory end, Feasel pointed to work Schneider and others are doing with Advanced Energy Economy on a template for utility rate design. Wide adoption of distributed energy presents utilities with another round of stranded costs – as occurred two decades ago when competition was introduced to the electric industry. But this time, resolving the stranded cost problem is more daunting. Distributed generation adds a new level of regulatory and financial complexity, according to Feasel.
“The investment is not going on the grid, where it used to. It’s going behind the meter. So you have this challenge where we have a rate structure that isn’t always incentivizing the right thing,” he said.
Despite these issues, the market is moving ahead. While Schneider’s customers once installed microgrids largely for resiliency, they now increasingly see them as a way to better manage their energy.
Inside the Schneider Electric microgrid
Located in Andover, Mass., Schneider Electric’s microgrid includes a solar array built and operated by REC Solar. Duke Energy Renewables, which owns a majority interest in REC Solar, owns the microgrid system and solar array and is selling the power to Schneider Electric through a long-term power purchase agreement. By using the microgrid-as-a-service business model, the company was able to build the microgrid without any upfront capital cost.
“The integration of an advanced microgrid at the Schneider Electric campus reduces its energy costs, incorporates more sustainable energy and delivers demand-side efficiency, while also offering resiliency to the facility in the event of a loss of power from the grid,” said Chris Fallon, vice president of Duke Energy Renewables and Commercial Portfolio. “Additionally, in partnership with Schneider, we can research and develop new microgrid technologies, solutions and applications in a real-world environment.”
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The microgrid is expected to generate more than 520,000 kWh of electricity per year. It includes a 354-kW (AC) solar array with 1,379 solar modules that power the system. The microgrid also incorporates a natural gas generator as an anchor resource, allowing the solar panels to operate during grid outages to maintain critical operations.
The project was built as part of non-exclusive partnership between Schneider and Duke. The partners also are building microgrids for the Public Safety Headquarters and Correctional Facility in Montgomery, Maryland. Duke Energy Renewables will own the two Montgomery County microgrids, which will consist of a 2 MW solar project and two combined heat and power (CHP) units.
The Boston and Maryland microgrids are underway via a partnership between Schneider and Duke Energy’s unregulated arm, which is pursuing microgrid development nationally. Separately, Schneider also is working with Duke’s regulated utility, which is building microgrids within its service territory.
An energy project that preserves the view
Among Duke’s regulated projects is the unusual Mt. Sterling microgrid, which the North Carolina Utilities Commission recently approved.
The Mount Sterling microgrid includes a 10-kW solar installation and a 95-kWh zinc-air battery storage unit. Built as a non-wires alternative, the small microgrid promises to rid Great Smoky Mountains of four miles of distribution wire and return about 13 acres of wilderness to its natural state.
So rather than obstructing a scenic vista, as so many energy projects do, it’s improving the view.
Duke said it plans to begin project construction in a month.
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