Microgrids: An Energy Evolution of the World’s Biggest Machine


by Dave Smith

The North American Electric Grid is getting smarter and becoming more resilient. The Grid is considered by many to be the biggest machine in the world, and among the greatest accomplishments of the 20th century.

The electric grid came to life when Thomas Edison flipped the switch at his Pearl Street power station in lower Manhattan in 1889. Over the ensuing decades and well into the 20th century, the grid grew based on a centralized model where larger and larger power plants fed power through increasingly expansive transmission and distribution lines. Significant economies of scale favored this model, and it made cheap, reliable electricity available throughout the US, which in turn helped power unprecedented U.S. economic growth and the emergence of modern society. But going forward, this centralized hub and spoke architecture is not without limitations and costly tradeoffs.

For example, permitting and building large power plants was relatively easy in the early- and mid-1900. Now, environmental, safety and “not in my back yard” (NIMBY) concerns have added considerable cost, time and risk to the process. The same can be said of building and permitting large power transmission lines. With growing frequency, extreme weather events expose the vulnerability of the centralized grid with its many single points of failure. And the grid is not getting any younger. Built out largely by the 1970s and 1980s, the North American grid is aging and susceptible to equipment failure.

Fortunately, an alternative decentralized model is emerging that offers improved resilience and reliability, as well as reduced capital cost and environmental impact. Specifically, “Distributed Energy Resources” (DER) are helping to drive power generation to the “Grid Edge”. These resources include solar photovoltaics (PV), wind power, and natural gas-powered fuel cells, microturbines, and engine-generators that produce both power and useable heat at the point of use. The latter can be 70% – 80% efficient, whereas traditional grid power loses more than 50% of its energy in wasted heat, pollution, and transmission and distribution losses by the time it reaches the end-use point. While renewable solar power has its limits, affordable battery storage holds the promise of significantly improved reliability and usefulness, 24 hours per day.

The advantages of DER at or close to the point of use are apparent, as extreme weather has flooded substations, downed power lines, taken power plants off-line and otherwise left millions of people without electricity for days or weeks at a time. In response, the Federal government, most notably the Department of Defense (DOD), has committed to deploy resilient “microgrids” on many of its mission-critical bases. Microgrids take DER one step further by interconnecting multiple resources, and adding local intelligence and control that enables operating in both grid-connected mode and when the grid goes down. Fueled by natural gas and often incorporating renewables and battery storage, microgrids can operate for weeks or months at a time.

The appeal of resilient microgrids is not limited to the DOD. The Northeast Region of the United States, impacted severely by Hurricane Sandy, has undertaken an extensive effort to promote microgrids and distributed energy resources. The State of New York is promoting community microgrids as part of the “NY Prize” program, and has funded 83 separate microgrid studies for communities throughout the state. Burns participated in six of those projects. New Jersey Transit’s rail operations into and out of New York City was crippled after Sandy. Burns is part of a team that was chosen to design what will be a first-of-its-kind microgrid, and will provide resilient power to ensure reliable transportation, even under the most extreme weather conditions.

This move to the Grid Edge also promises a new level of capital efficiency and infrastructure optimization. Again, New York is at the forefront. Con Edison, New York City’s electric utility, needed $1 billion to bring a new 137 kV sub-transmission feeder into their overloaded Brownsville substation in the heart of Brooklyn. But the Public Service Commission rejected that proposal and instead approved just $300 million to deploy a variety of DER solutions at or in close proximity to end-use points at the Grid Edge. The Brooklyn-Queens Demand Management (BQDM) initiative is projected to save ratepayers as much as $700 million. Burns is excited to have an active role in driving resilient and efficient infrastructure as part of two potential BQDM sites.

Microgrids do not signify the end of the centralized grid. Rather, we believe what will emerge is the ability to leverage the best of both models, resulting in a hybrid solution that is smarter, stronger, cleaner, and less costly.