Batteries allow excess energy from renewable sources to be stored and used later so customers can use it to generate extra revenue. Fuel cells, for instance, convert fuel into electricity through an electro-chemical process that is clean, quiet and easy to use on-site. These technologies can be used as part of a microgrid strategy. Keep in mind that utility regulation varies from one state to the next, so the return on the power you generate depends on the grid operator.Ĭonstellation has invested in more than $1 billion in distributed energy assets since 2010 and offers a variety of integrated energy solutions that support microgrids, including battery storage, fuel cells, cogeneration (which provides power from excess heat) and backup generation. You’ll also see the biggest benefit if you can sell your excess power back to the grid through net metering, which is now offered in most states. Microgrids tend to have the best payoff in markets where electricity prices are high and the operator can offer a more cost-effective alternative to a large population that’s concentrated in one area. You should also consider the efficiency of your building and whether you need upgrades-such as better insulation or smart heating and cooling systems-to reduce the amount of energy you’ll actually use.Ĭonsider the population of your area and how many potential users you’ll have. That includes the price of fuel, equipment and construction. Like any other project, you need to weigh the costs and savings before you determine whether a microgrid is a good option for your company.įirst, be sure you’re taking all costs into consideration. Working with a renewable energy installer in your area can also help you to finance the project. For information on all state and federal incentives, visit the department’s Database of State Initiatives for Renewables & Efficiency. Department of Energy has recently added new incentives for renewable energy and local distribution in seven states. In many cases, they can take advantage of tax incentives for renewable energy or energy efficiency programs related to their microgrid. One the other side, some residents and small business owners have been building do-it-yourself microgrids for years. Taxpayers are footing the $18 million bill. Connecticut, for instance, is building nine microgrids to provide more reliable power to critical infrastructures, such as police stations, naval bases and hospitals. On one end of the spectrum, we have states spending millions of dollars to provide more reliable power to their communities on a large scale. The cost of investing in a microgrid again depends on the size, scope and purpose of the project. What Will it Cost to Invest in Microgrids? Once they begin to sell to a third party, they’re subject to FERC oversight. That puts them under the state’s jurisdiction rather than federal oversight. While electric utilities are required to buy energy from qualifying facilities at competitive rates, microgrids that meet the requirements for exemption may sell all their power directly to a local utility or on-site customer. Microgrids can be exempt from most federal and state regulations if they meet certain standards from the Federal Energy Regulatory Commission.Įxempt microgrids, known as FERC-jurisdictional qualifying facilities, are able to opt out of certain regulations that govern rate setting, construction and operation. Regulation depends on several factors, including the size and purpose of the microgrid. This blog will go beyond the questions about why you should install a microgrid and address the more practical matters of implementation. You may be wondering whether microgrids are a viable option for your business and what practical steps you need to take to if you’re interested in installing a microgrid. We can even reap the rewards of contributing more energy than we use.īut in many ways, the laws are still catching up to the technology. U nlike a one-way connection of a power plant that produces energy and sends it, microgrids are two-way connections that allow us to contribute something back. However, new technology has made them more advanced and better able to store energy from a variety of sources. Microgrids, or shared networks of locally distributed energy generation that can operate independent of the traditional grid, have been around for decades. There’s a lot of talk about microgrids lately, and they’re being touted as the answer to our global energy crisis.
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