Capacity of Planned or Operating Microgrids Now Totals More Than 2.5 Gigawatts Worldwide
May 10, 2012
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Essentially, microgrids represent an emerging smart grid platform that incorporates a
variety of hardware and software product offerings. According to a new update report from Pike Research, North America is the world's most promising market for grid-tied
projects, with over 50 new projects coming to light since 4Q 2011 (primarily in the
United States). These projects boosted overall planned capacity in North America to 1,550
MW in 2Q 2012, up 51% from 1,026 MW as reported last by Pike in 4Q 2011.
The firm also finds that the
remote microgrid segment is the best long-term bet. As evidence of this,
the region boasting the largest growth during the last quarter (356%) as did the
catch-all category "Rest of World," which are, generally speaking, less developed countries
without robust grid infrastructure, and therefore in need of the aggregation and optimization
capabilities of microgrids. Planned capacity rose from 76 MW to 391 MW in the Rest of
World category, an increase of 416%. Many of these projects are in the very early
planning stages. Pike also learned of several other organizations working with
the United Nations to use microgrids as a platform to help alleviate "energy poverty"
throughout the developing world, but they were not yet ready to share any project details.
In terms of application segments, the largest jump in identified projects was in the
institutional/campus segment, the global market leader on microgrids. 18 new microgrids were identified in this segment, or an additional 140 MW of new planned
capacity. However, when it comes to percentage growth in total capacity additions, it was
the commercial/industrial (C/I) segment that displayed the largest increase. This segment
rose from 71 MW in 4Q 2011 to 322 MW in 2Q 2012, a 356% increase. Note, though, that
this dramatic increase was largely due to a single 200 MW project in the United States that
may not be fully developed until 2018. Nevertheless, several other microgrids of equal and
even larger scale (and rumored to be in the early stages of planning in the Asia Pacific
region) were not included in this tally, highlighting how the C/I segment appears poised for
major growth over the next 6 years.
The military segment is often touted as leading the way for this smart grid application.
Ironically enough, it now represents the smallest amount of total capacity among all
segments. While 14 new military microgrids were identified, few of these new entries
included data on the capacity size of these systems. It is safe to say that the 228 MW of
identified military microgrid capacity in 2Q 2012 greatly undervalues the size of the market,
since many of these projects are clouded in secrecy. Moreover, many of these projects
start out extremely small and then will grow dramatically over time. In fact, the military
segment remains the most consistent, with virtually every military base in the United States
planning on ultimately deploying some form of a microgrid.
The most growth in terms of total new planned capacity, however, was in the remote
systems segment, with 12 new microgrid entries (some representing multiple projects), or
309 MW of new planned capacity. With those additions, the remote systems segment
grew from 356 MW in 4Q 2011 to 665 MW in 2Q 2012, an increase of 87%.
The community/utility microgrid segment now equals the remote microgrid segment with in
terms of total planned capacity (665 MW), but shows the lowest quarter-to-quarter capacity
All told, 87 new microgrids were identified that are either planned, proposed or in current
operation, and which that totaled over 2,575 MW in planned or operating capacity in 2Q 2012. This
compares to 1,695 MW of planned and operating capacity identified in 4Q 2011, a 54% capacity increase.
In the past, it was safe to say that the majority of microgrid projects were pilot projects and/or research-related experiments. This perception
is slowly fading away. The year 2011 signaled a shift, as some of the first large-scale
commercial microgrid projects reached significant milestones. With the adoption of the
IEEE islanding standards P1547.4 in July 2011, the shift from pilot validation projects to
fully commercial projects accelerated, as evidenced by the large jump in planned,
proposed and operating grid-tied microgrids in North America.
Globally, the rising costs of
diesel fuel - and corresponding drop in solar photovoltaic (PV) prices - have signaled the
promise of a flurry of new commercial activity regarding remote microgrids throughout the
developing world. Depending upon one's definition of what is and what is not a microgrid,
remote systems could lead the global microgrid market in terms of revenue by 2018.
Source: Microgrid Deployment Tracker 2Q12 by Pike Research. Excerpts reprinted with permission. The Tracker is a database updated biennially
and covers five microgrid market application segments and four principal world regions.
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