Today, there are several industrial sites worldwide with on-site generation and islanding capability. The main reason for these constellations usually is the requirement for process optimization in a certain industrial site. For example, huge amounts of steam are required for chemical processes. In this case the process owner can decide to install its own steam turbine-based generation, which will increase power supply reliability and reduce the cost of energy.More
Distributed generation located close to demand delivers electricity with minimal losses. This power may therefore have a higher value than power coming from large, central conventional generators through the traditional utility transmission and distribution infrastructure. With the use of renewable energy generation, the dependency on fossil fuels and on their price can be minimized. This step will also lead to a significant reduction of carbon dioxide emissions, which is required in several government programs. If, in addition, distributed generation and consumption in a certain area are integrated into one system, reliability of the power supply may be increased significantly, as shown in figure 1. The importance and quantification of these benefits has been recognized, although these are yet to be incorporated within the technical, commercial, and regulatory framework .
However, under today’s grid codes, all distributed generation, whether renewable energy or fossil-fueled, must shut down during times of utility grid power outages [IEEE 1547]. This is precisely when these on-site sources could offer the greatest value to both generation owners and society.
A microgrid is a regionally limited energy system of distributed energy resources, consumers and optionally storage. It optimizes one or many of the following: Power quality and reliability, sustainability and economic benefits and it may continuously run in off-grid- or on-grid mode, as well as in dual mode by changing the grid connection status.