The advancements in grid infrastructure, regarded as one of the most disruptive technological developments, has led to microgrid industry registering exponential growth in the last many years, according to Global Market Insights.
The research firm estimates the microgrid market size, pegged at a modest $4 billion in 2017, to register a nearly five-fold growth to surpass $19 billion by 2024.
Global capacity projected to exceed 6GW by 2024.
In a scenario where governments all over the world are striving to enable easy access to electricity and at the same time opting to bring down carbon emission, microgrids have emerged as the most potential solution.
The Electricity Access Report published by World Bank states that in spite of the electrification revolution, which had begun in the 1860s, at present more than 1.06 billion people around the world still have no access to electricity.
Approximately 87% live in remote rural areas and in island nations where the cost of extending grids to such regions is too high and no easy solution to the problem has been derived yet.
The development of photovoltaic and lithium-ion battery technologies have however created scope for a solution and microgrid technology advancement has helped to achieve rapid electrification in remote areas. In developing countries like Kenya, Guinea and Cameroon, micro-grid renewable energy technology has provided an important development course for rural grid electrification.
A few years back Huawei collaborated with the Ministry of Water Resources and Energy of Cameroon to complete the first phase of a micro-grid solution project called the Huawei PowerCube5000 that is designed to generate 11.2 MW of power, benefitting 120,000 people in 166 villages of Cameroon.
The second phase, which is under construction will further cover 184 villages benefitting approximately another 120,000 people. The incidence validates that the developing nations, as well as developed nations, are rapidly investing in the enhancement of microgrid technology, fueling the global microgrid industry trends.
The developed nations have been witnessing a slew of significant investments in microgrid technology. In 2017 for instance, the U.S. Department of Energy announced and investment of $50 million for the advancement of grid reliability and microgrids in the aftermath of devastating hurricanes like Irma and Harvey.
The DOE’s aim was to focus on the improvement and strengthening of an electricity delivery system that can recover easily from compelling disruptions. As per a report by Global Market Insights, Inc. the overall North America microgrid industry size is set to surpass the capacity of 3 GW by 2024.
More recently in 2018, the Georgia Institute of Technology and Georgia Power have teamed up to build a research microgrid that is anticipated to achieve a stellar leap towards the understanding of the microgrid technology, consequently augmenting the microgrid market.
According to experts involved with the project, which is estimated to cost $10-$15 million, this initiative is of significance, having arrived at a time when grid architecture is becoming aligned with microgrid-based systems. Microgrids are of momentous importance to the power industry and the growing popularity of microgrid market is expected to pose as key solution for high reliability, reduced costs and sustainability.
The Georgia microgrid will not be entirely experimental as the 1.4 MW microgrid is being designed to serve several buildings in the 400-acre campus of Georgia Tech, administrative offices, a data center and a hotel.
The microgrid, which is designed to have a flexible topology and allow power to be routed to wherever needed, will provide backup power to the buildings if the central grid fails. Since the microgrid will operate on the basis of a power purchase agreement, it is also anticipated to offer an opportunity to explore business models and contracts.
Construction industry expansion to add traction to microgrid market
The microgrid industry has received increased interest from governments as initiatives like the Paris Agreement have brought global economies together in combating climate change. This has led to increased focus in developing energy efficient solutions and technologies. Microgrids have come to the forefront of being recognized as an energy efficient technology as research depicts the technology to create a desirable infrastructure for improving the efficiency of energy consumption in buildings.
Research also shows that even without changing the hardware configuration in a building with an older structure, energy consumption can be reduced by as much as 20%-30% with the optimization of operation and management.
Microgrids can tap this enormous potential for energy savings in buildings by improving coordination and optimization of operation of various energy loads and sources. Also, the construction industry around the world has been developing at an exponential rate and the implementation of efficient power operation system or microgrids will be the rite of passage to a world that is meant to be more energy efficient and less burdened with harmful emission.
Microgrids are now being used by hospitals, military, university campuses, government buildings, smart cities and communities because of the myriad benefits they offer. It keeps the power supply stable even when the central grid fails and offers a means of upgrading distribution grid, hardening infrastructure and protecting vulnerable communities. Through urbane, automated energy management, a microgrid can strengthen clean energy use and boost customer confidence by creating economic value.