WHITEFISH, MT / ACCESSWIRE / November 24, 2014 / Most people remember the Northeast blackout of 2003 that
affected some 55 million people in the United States and Ontario, Canada. In that case, a software issue in an alarm
system in a control room of FirstEnergy Corp. (NYSE: FE) was cited as the
source of what could have been a localized blackout that cascaded for hundreds
of square miles. There has also been the
stark awareness of weakness in the power system through superstorms, such as
Hurricane Sandy that bombarded the East Coast last year, signaling that the problem
actually runs deeper and points to an aging national electricity grid system
that can leave the U.S. susceptible to power outages. Greater recognition of potential outages,
whether completely justified or not, of an overworked grid, cyberthreats,
brutal weather and even things like squirrels (yes, squirrels) are helping
spawn acceptance of new technologies and microgrids that give communities more
control of power while reducing stress on the existing grid. As the grid evolves into being less
centralized, conglomerates involved in utilities such as General Electric
(NYSE: GE) will certainly play a role, but a bigger upside may reside in
smaller companies with green technologies, including solar plays SolarCity
(NASDAQ: SCTY) and First Solar (NASDAQ: FSLR) and Combined Heat and Power firms
like Tecogen (NASDAQ: TGEN) in a multiple-win for more consistent power and
reduced emissions.
What Can Knock Out
The Grid?
Not to spread fear, but people need to be aware of a gamut
of arguments as to why changes need to be made in the existing grid
structure. In March, the Wall
Street Journal reported that the U.S. could face a nationwide blackout if
only nine of 55,000 electric-transmission substations failed on an extremely
hot summer day, citing research by the Federal Energy Regulatory Commission
(FERC), although federal officials were careful to warn that the analysis could
overstate the vulnerability of the national grid.
The website UtilityDive
last month cited former FERC Chairman Jon Wellinghoff as saying the microgrids
and grid diversity are essential to U.S. energy security and protecting against
the loss of a single component, albeit via a planned attack or accident,
spreading into a larger blackout. Given
the conflict in the Middle East, some pundits have warned that the grid could
be a target or terrorists, namely the radical group Islamic State of Iraq and
Syria (ISIS). "Inadequate grid security,
a porous U.S.-Mexico border, and fragile transmission systems make the electric
grid a target for ISIS," said Peter Pry, one of the nation’s leading experts on
the grid, in a Washington
Examiner article in September.
In April, Nicholas K. Akins, Chairman, President and CEO of
American Electric Power (NYSE: AEP), testified
before the Senate Energy and Natural Resources Committee that the reliability
of the grid was tested, and narrowly passed, in January as the arctic weather
of the polar vortex pushed winter peak load to a record level. "This country did not just dodge a bullet –
we dodged a cannon ball," Akins stated. To be clear, Mr. Akins was making a case on overall policy to ensure
grid reliability, not a granular case for microgrids or alternative energy, but
his comments add color as to how the existing grid is testing its limits.
The UtilityDive article also notes how rodents can wreak
havoc on the grid, citing a squirrel causing an outage in Rhode Island. Sound isolated and freakish? It’s not, as published in a New
York Times article penned by Jon Mooallem in which Mooallem said squirrels
were responsible for at least 50 power outages in 24 states from Memorial Day
to August that affected tens of thousands customers. Other reports show animals to spark (pun
intended) many more outages.
Microgrids: Helping Alleviate Perceived and Real Threats
Now, the grid threats should be taken completely in context,
as stopping a teething wild animal from chewing through a power source is
obviously a unique challenge and while cyberattacks on the grid could be
disastrous, they are exceptionally difficult and would require extensive
resources well above and beyond your typical Internet hack to pull off. Weather and overall stress on an aged grid
system are viable concerns everyday, though. Microgrids and on-site power systems can serve
as options to avert some of these general worries.
In short, microgrids are smaller versions of a city or
national grid that have technologies to generate (and sometimes store) their
own electricity. They don’t necessarily
have to be completely disconnected from
the national grid, instead blending power as required. Staying connected means that microgrids can
draw from the bigger grid when economically reasonable and in times where local
generating assets aren’t sufficient for demand or, conversely, feed power back
to the gird. Overall, they can reduce stress on the
traditional grid by a drawdown in usage, while increasing reliable, consistent
power within the microgrid network.
Declining solar costs have created new opportunities in the
energy space as consumer interest rises, helping prove the efficiency and
potential of solar power systems being stitched to the grid, although
regulatory hurdles are still tall to cross on that matter. To understand growing installations, consider
that SolarCity, the largest rooftop solar installer in the U.S., could boast 168,339 customers at the end
of the third quarter this year, compared to 92,998 at the start of 2014 as it
aims for a goal of one million customers by 2018. While not exactly in the same vein as microgrids
at this moment for distributed energy, SolarCity’s figures demonstrate the
growing acceptance and economic viability of solar power systems today as
compared to even a year ago. More
specific to microgrids, SolarCity has a growing number of energy storage
installations featuring Tesla (NASDAQ:TSLA) batteries, digital controls,
real-time communications and inverters that can convert battery DC power to AC
power for the grid that could serve many needs.
How this plays out in the future is yet to be determined, but microgrid
applications as well as feedback to the grid to reduce electricity travel
distances and improve reliability appear in the mix.
One of the keys to bringing microgrids and "personal
electricity" (which could actually be considered the smallest form of a
microgrid) to prominence is the economics to consumers, which SolarCity is
overcoming by launching MyPower, a
financing plan that allows homeowners to lease its systems with little or no
money up front, part of a new business model dubbed
Microgrid-as-a-Service.
Solar companies cannot be shy about shouldering upfront
costs to develop a footprint and microgrid systems, especially if they want to
penetrate foreign markets where some 1.3 billion people (largely Africa and
India) don’t have access to electricity. First Solar (NASDAQ: FSLR) and SunEdison (NYSE: SUNE) are looking to electrify
the Indian markets with microgrids. First
Solar, one of the largest solar panel suppliers in India, is
reported by Clean Technica to be launching a pilot project to help set up
microgrid solar power projects in the country. This followed SunEdison announcing
a new project that will install 241 kilowatts (kW) of solar photovoltaic microgrids
with battery storage in 54 remote Indian villages, bringing cost effective
electricity access to 7,800 off-grid individuals.
Combined Heat and Power, or CHP, systems also can sit at the
center of microgrid systems, with different technologies and fuel sources used
to generate electricity. Peter Asmus of
market research firm Navigant Research, believes
that "CHP will be the leading distributed generation choice for microgrids in
terms of capacity over the next five to seven years," according to
Thomasnet.com. Navigant forecasts
that microgrid market revenue will jump from under $10 billion in 2013 to more
than $40 billion by 2020, partially because microgrids "require greater
investment than previously recognized." Asmus doesn’t stand alone for CHP potential; Alex Kragie, the former
Deputy Chief of Staff at the Connecticut Department of Energy and Environmental
Protection, said
he thinks “CHP is one of the most appealing generation solutions when it comes
to microgrids, for the simple reason that it reuses waste heat, making it one
of the most efficient generation technologies."
CHP is founded on the premise of creating two forms of
energy from one source. The range of
sources can be vast, including biogas and oils, but the most common is natural
gas. The gas is used to power an engine
to create electricity with nearly every bit of the heat generated by the engine
captured and recycled for another energy need, often hot water, space heat of
even for chiller systems. This
tried-and-true means of creating two types of energy is far more efficient than
conventional methods used by utilities (i.e. coal, nuclear), while
significantly reducing emissions. Applications are starting to be employed, including Connecticut awarding
$18
million in funding for microgrid projects, some of which incorporate CHP
systems. Governor Dannel Malloy has
recommended an addition $30 million in funding over the next two years for the
state’s microgrid program as it works to “modernize and harden our infrastructure
to withstand severe weather” and “protect residents and vital public services
even when the power goes out,” according to Malloy.
Those wondering what a small CHP system looks like can take
notice of the Tecogen InVerde 100 CHP unit shown in the aforementioned UtilityDive
article. Tecogen has taken the idea
of CHP energy production with emission reduction to new levels with its InVerde
Ultra 100, being the first and only natural gas engine-driven CHP system able
to operate under the extremely low levels of regulated pollutants allowed by
the distributed generation regulations for Southern California enacted in 2008,
based on the California Air Resources Board (CARB) standard published the
previous year. The InVerde Ultra 100 is rated at 100 kW continuous electrical
output, while simultaneously producing 6.7 therms per hour of hot water (230
degrees Fahrenheit). The systems are
scalable, able to be installed in a building block format to meet demand. When all the recoverable heat is used, the
overall efficiency of the module reaches 90 percent.
Typically these units are tied into the grid to maximize
efficiency, meaning that calibrations are set to using 100% of the thermal
energy (essentially eliminating an expense by using the free heat byproduct of
creating electricity) with any remaining electricity demand pulled from the
grid. In the case of a grid outage, the
systems have fail-safe technology that detects the grid blackout, immediately
increasing electricity output until the grid reconnects, at which time the
system powers back to normal mode.
Sign up to follow Tecogen Inc. (TGEN) here: http://www.tdmfinancial.com/emailassets/tgen/tgen_landing.php
The Natural
Progression
The national electricity grid has its problems, but it is
overall an engineering and operational wonder that has been remarkably stable
for the last century; there’s no real criticism that can come on the historic
front outside of a blip here and there. However, technology has a way of natural progression and as it so
happens is coming at a time of need to provide even more reliable power to a
growing world with an unquenchable thirst for electricity. A paradigm change of this magnitude doesn’t
happen overnight and it won’t happen with the grid either, with still only a
miniscule fraction of nation’s power coming from outside the utility grid. Don’t expect solar or CHP to take big chunks
of market share from utilities in the near future, although small pieces are
valuable enough to stakeholders. Broadly
speaking, a slow shifting of the industrial order looks to be taking its course
with microgrids and alternative energy sources serving a valuable benefit
globally to better ensure a constant supply of electricity, reduce our
pollutive footprint and bring power to people that go without now.
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Source: TDM Financial