Electricity Delivery and Management:

Microgrids

Some industry leaders see microgrid architectures, with their ability to manage variable generation resources and local electricity demand, as the model for integrating distributed generation into future utility distribution systems.

Some institutional, military, educational, or private enterprises with their own local distribution networks are developing microgrids that independently generate and manage their own electricity, often integrating renewable sources, with the ability to connect to or disconnect from the larger electrical grid. The Microgrids subsegment also includes remote communities with expensive or unreliable access to the main electricity grid, such as in developing countries and many parts of rural Alaska.

Global 2011 Microgrid revenue, including equipment and services, reached nearly $2.2 billion, with robust growth for 2012 estimated at 18%, to $2.6 billion. Although remote microgrids make up the largest share (>80%) of the global market, some utility industry leaders see microgrid architectures, with their ability to manage variable generation resources and electricity demand locally, as the model for integrating distributed generation into future utility distribution systems.

Utilities in the United States have historically not been receptive to microgrids, citing competitive and safety concerns. New technical standards governing the interface between microgrids and the public grid, and increasing receptiveness by some utilities, promise to expand the U.S. market, which was $632 million in 2011, to an estimated $755 million in 2012, for year-over-year growth of 19%.

Economic Impact

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