During the session, John Kelly, deputy director of the Initiative, described smart microgrids as a way to maximize smart grid benefits for consumers and businesses. "Microgrids represent a new way of thinking about electricity service," Kelly said. "They offer the opportunity for utilities to partner with communities in designing and planning their power system, for maximum benefit to all. Their localized nature drives innovation and creates opportunities for new business partnerships and more active participation by consumers."
Tom Bialek, chief engineer of technology innovation development at San Diego Gas & Electric; Len Pettis, chief of plant, energy & utilities at The California State University; Rob Thornton, president of International District Energy Association; and Guy Warner, chairman and CEO of Pareto Energy LTD, shared examples of successful microgrids on university campuses, in cities and in rural areas. The panel joined Kelly in a discussion that examined the costs and benefits of smart microgrids, as well as the obstacles that impede their rapid deployment. Points of discussion included the following:
* Smart microgrids let communities, universities and other entities participate in managing their power loads. Intelligent controls built into localized smart microgrids help these locales respond more proactively during periods of high demand and save energy by conserving electricity at times of lessened need. Additionally, local smart microgrids allow communities to augment the bulk power supply through solar cells, wind turbines, small generators and other means, often offsetting the need for new centralized power plants.
* Smart microgrids accelerate improvements and meet consumer needs. The localized nature of smart microgrids means that systems are built to the exact specifications defined by their constituents’ power requirements. The resulting transparency accountability helps to ensure that improvements are made promptly and efficiently.
* Smart microgrids are more reliable and responsive — and help save money. Reliability improvements are achieved through redundancy, smart switches, automation and local power generation, allowing smart microgrids to operate independently of the larger grid if necessary. In return, one system backs up the other, helping to prevent blackouts and other failures. As outages cost consumers and businesses at least $150 billion annually, the savings can be significant. Many microgrids maximize efficiency through combined heat and power and feature improvements that allow consumers to more carefully regulate their energy consumption and spending such as dynamic pricing and in-home control devices.
* Smart microgrids benefit utilities. These systems allow utilities to balance generation and load and attract private investment. Distributed generation provides backup power to help manage peak demand, improve reliability and reduce costs tied to loss of service, allowing utilities to use those resources elsewhere. Microgrids also open the door for utilities to offer auxiliary services such as renewable energy, demand-response, infrastructure for electric vehicles and more.
* Despite the benefits, barriers exist to broad adoption of microgrids. Regulations prohibit many utilities and communities from microgrid development. Policies and regulations are needed that incentivize collaboration among businesses, utilities and communities and encourages investments in local distribution systems, where lie most of the opportunity for improving the reliability, efficiency and affordability of our energy system.
The Galvin Electricity Initiative was launched by former Motorola CEO Robert W. Galvin to transform our electric power system into one that is fundamentally more reliable, efficient, secure and clean, and meets the needs of 21(st) century consumers. In 2010, the Initiative is accelerating its multistate campaign to spark a migration toward a consumer-driven electric power system. The campaign goal is to promote grid modernization through Perfect Power smart microgrids that place top priority on serving consumers and businesses with reliable, high-quality, clean power.