Pike Research sees AEP, SMUD and SDG&E as microgrid trendsetters

Rather than a top-down utility model, which utilities have traditionally been staunchly opposed to, microgrids are a bottoms-up approach to the smart grid, according to Pike Research Energy Analyst Peter Asmus. There are a few exceptions, however, including American Electric Power (AEP), Sacramento Municipal Utility District (SMUD), San Diego Gas & Electric (SDG&E) and BC Hydro, he said in an interview.

The most compelling - and controversial - aspect of microgrids is that they can separate and "island" from the larger grid during times of grid outages, Asmus explained.

"That's why the military is so gung ho on them," Asmus said. "The other main current customers are college campuses, because they often have on-site power generation and multiple buildings all on a contiguous campus featuring a single owner."

The microgrid comes from the end-use customer because the utility grid - whether smart or dumb - isn't giving them what they need. Some research institutions such as Lawrence Berkeley National Laboratories take the position that the microgrid is the opposite of the smart grid, since it is focused on different levels of reliability, generation, storage, etc., determined completely by the customer.

"If utilities were smart - and some are now seeing the light - the microgrid could offer an alternative, especially in communities now pushing back on smart meters. There are microgrid controllers that are "dumb" that do not need the sensors and immense data flows of the smart grid. But there are also microgrids that are, in many ways, far more sophisticated than the current status of utility smart grid deployments," Asmus said.

The major challenge with microgrids is ensuring that all of the components work together when disconnected from the larger grid, and then seamlessly reconnect when power is restored.

"A variety of firms offer control systems for microgrids. Lockheed Martin, Honeywell and GE are some of the bigger names, but some of the most innovative work is being performed by companies such as General Microgrids, Pareto Energy, Power Analytics, Viridity Energy and Spirae," Asmus said.

"The U.S. is the world's top microgrid market because our grid is uneven in quality, creating pockets where new technologies can offer greater value to both end-use customers and utilities."

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