The US microgrid market is set to grow 127 percent from 2015 to 2020, reaching 2.8 GW with a cumulative investment of $3.5 billion, according to a GTM Research report issued July 7.
The report also found that:
- By 2020, renewables will make up 26 percent of overall U.S. microgrid capacity
- 44 percent of operational microgrids integrate battery storage
- About half of operational microgrids include 1 megawatt or less of generation capacity
- Seven states account for over 80 percent of operational microgrid generation capacity
Most microgrids operate on fuels, but renewables are expected to grow more than tenfold to 730 MW by 2020, says the report.
How will the money be spent on these microgrids? A big portion — about 40 percent — will go to the generation portion of the microgrid. GTM Research attributed the remaining balance of project costs to distributed grid enhancements, switching and protection, controllers and modeling, project development, siting and permitting, and energy-efficiency upgrades.
Courtesy of GTM Research
Right now, microgrid development is tending to occur through requests for proposals. But strategic partnerships also are emerging to bring about projects, according to GTM.
“Factors such as increasing customer demands, technological maturity, the decreasing price of renewables, and shifting regulations are driving the transformation of the microgrid market,” said Omar Saadeh, GTM senior grid analyst. “This transformation is creating viable, economic solutions for end customers looking to attain energy surety, as well as opportunities for vendors to expand the addressable market to new customer classes.”
He added that “as barriers are overcome, projects that have a connection to public safety, business continuity and grid modernization are driving the next growth phase of the microgrid market.”
The report, “North American Microgrids 2015: Advancing Beyond Local Energy Optimization,” is available for a fee here.
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