microgrid definition

What Is a Microgrid? Definition, Applications, and Benefits

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A microgrid is a small-scale power network that connects individual customers to a central source of electricity. With a group of interconnected distributed energy sources like solar panels, wind turbines, or fuel-burning generators, a microgrid is able to do the following:

  • Electricity
  • Batteries of a significant size and electric cars are used to store the power.
  • Gear and software designed to monitor and disseminate it, as well as
  • Consumers at the end of the supply chain, such as houses, businesses, or office buildings.
microgrid definition

In the event of a disruption in the main power supply, a microgrid may either function independently ("behind the meter") or be linked to the larger grid ("in front of the meter"), but it will still be able to maintain the flow of energy.

The Growth of Microgrids

There is nothing novel about microgrids. Establishing microgrids is a common way for places like hospitals, military bases, prisons, fire stations, and grocery store chains to make themselves less vulnerable to power outages.

It is anticipated that the proportion of microgrids that rely on fossil fuels will fall from 80 percent in 2020 to a lower number as an increasing number of businesses put an emphasis on renewable energy.

The diesel-fueled backup power system of the Kaiser Permanente medical complex in Richmond, California, was replaced in 2020 by a microgrid that is supplied by renewable energy. The goal of the facility is to become carbon neutral. In a similar vein, the Idaho National Laboratory, which is part of the United States Department of Energy, initiated a program called Net-Zero Microgrid in October 2021. This program's goal was to integrate clean, renewable energy sources into microgrids that were already in existence as well as those that were being developed.

Growing Power

As of September 2020, there were 1,639 microgrids working in the United States. Together, they provided more than 11 gigawatts of power to their clients.

The dramatic reduction in cost seen by wind, solar, and battery technologies over the course of the last decade has been a major factor in driving the expansion of microgrids. Those microgrids that are "in front of the meter" are subject to the same regulatory framework and public utility commission oversight as any other energy supplier that is connected to the grid. This is in contrast to "behind the meter" microgrids, which include those that are located on campuses and are subject to fewer government regulations. A large number of states haven't finished writing their rules for "in front of the meter" microgrids yet, but they are still working on them.

The Federal Energy Regulatory Commission (FERC) issued new regulations in 2020 that require utility companies to allow microgrids to provide energy to the grid in the same manner as larger power plants. This was done in an effort to improve the integration of microgrids into the energy system in the United States. The goal of Order 2222 from the Federal Energy Regulatory Commission is to "reduce prices for customers via improved competition, more grid flexibility and resilience, and more innovation within the electric power business."

The Costs and Benefits of Microgrids

It is possible for the costs of larger-scale microgrids for campuses, companies, or whole towns to climb into the millions of dollars, with the mean cost falling somewhere between $2.1 and $4 million. On the other hand, the cost of a minor job may be as little as a few hundred dollars.

The requirements of the end users will determine whether or not the advantages are more valuable than the expenditures. Microgrids, in the eyes of some people, are analogous to insurance plans; if they are fortunate, they will never need to make use of them. However, for others, they can offer necessary services that allow them to remain connected to the outside world. There are several significant advantages.

Electrifying the Developing World

There are 770 million individuals on the globe who do not have access to electricity. 3.5 billion people do not have access to dependable energy, which creates impediments to economic development in the form of education, the internet, and other types of online economic growth. Most of these people live in rural areas, which makes it hard for developing countries to build a lot of electricity infrastructure because it's so expensive.

The endeavor to expand the availability of dependable electricity in poor countries is seeing a rising portion of its funding directed toward investing in solar-powered microgrids. Microgrids will be able to help countries with low and moderate incomes skip the step of using fossil fuels and go straight from not having power or having power that goes out to having clean, renewable power.

Lower Costs

Microgrids, as opposed to traditional power plants, are situated in closer proximity to the end users that they serve. As a result, they add more electricity to the grid without increasing the cost (or the amount of time) that would have been required to build transmission lines to customers, thereby lowering the cost of electricity for all customers of the grid. Batteries in microgrids can also be used to store electricity during times when the price of electricity is low and then sell that electricity to the grid during times when the price of electricity is high. This helps to keep the cost of grid electricity down while also providing a source of revenue for the microgrid.

Grid Services

The majority of people who use power will find that the assurance that microgrids provide comes at a high cost. Because of FERC Order 2222, owners of microgrids now have the ability to offer "grid services" to public utility companies, which will enable them to recuperate part of the costs associated with creating the microgrid. Massive batteries like theirs may be put to use to assist in stabilizing the grid by ensuring that electrons flow at the appropriate frequency and voltage. They can do this faster and with more flexibility than the large power plants that are typically responsible for providing these kinds of services.

Utility Microgrids

Microgrids are becoming so popular that even utility corporations are investing in them. Since 2014, microgrid pioneer Green Mountain Power, which is also the biggest utility in Vermont, has been developing solar-powered microgrids in order to provide essential infrastructure with emergency power in the event of a power outage. The systems will cover their costs via the savings they deliver to customers as well as through the services they provide to the New England grid. In February of 2021, Green Mountain Power made the most current announcement on one of its microgrid projects.

microgrid definition

Grid Security

New forms of cyberwarfare have grid operators and policymakers increasingly worried about the possibility of assaults on their country's electrical infrastructure. An electrical network that is more decentralized and structured on microgrids offers increased security. This makes it more difficult for cybercriminals to disable a complete electricity network by cutting off just a few sources of power. Most of the time, it is harder to destroy a guerilla force that is spread out than it is to destroy a target that is in one place.

Climate Resilience

In addition, a decentralized grid is more resilient against the effects of natural calamities. Microgrids have been more popular in rural areas around the world, including the outback of Australia, where bushfires have been responsible for the loss of 20% of the country's forests. Since the year 2000, there has been a 67% rise in the number of significant power outages that have been caused by weather-related events in the United States, which has led to an increasing interest in microgrids. And in 2017, after Hurricane Maria wiped out electricity over the whole island of Puerto Rico, the Puerto Rico Energy Commission made it a requirement that the island's system be rebuilt using microgrids as part of the process.

In the event of a natural disaster that forces a larger electrical grid to shut down completely, a microgrid could be used to "blackstart" the larger system.

Quicker Adoption of Clean Energy

Due to the fact that the development of large projects takes much longer than the development of smaller ones, microgrids have the potential to speed up the shift to clean energy. Because microgrids have smaller footprints and have fewer negative effects on the environment, they are subject to fewer restrictions and face less resistance from the community, which speeds up the construction process. Communities and small businesses can build their own networks and use energy sources that are good for the environment without having to wait for large-scale solar or wind farms to start up.


When you go camping or there is a power outage, creating your own microgrid may be as easy as getting a flexible solar panel that can charge a small battery. This will allow you to have a small quantity of energy available to you. One further example of a single-customer microgrid is a rooftop solar system that also has a battery backup. A microgrid that can power a whole town or group of buildings, on the other hand, is a bigger project that needs more money, the support of the local community, and permission from the right people.


What is a microgrid?

A microgrid is a set of linked loads and dispersed energy resources that behave as a single controlled entity in relation to a larger grid. Microgrids are becoming more common. It can connect to and disconnect from the grid, so it can work either as an island or as a part of the grid.

microgrid definition

What kinds of things may a microgrid be used for?

Applications of microgrids provide customers at the local level more control and assist them in becoming energy independent. There is a wide range of possible configurations and sizes for a microgrid. It is capable of supplying electricity to a single building or to a wide area, such as a whole city or college campus. The most fundamental categories are customer-owned, utility-owned, and remote distribution.

What are the advantages of using a microgrid?

Microgrids have the potential to facilitate the deployment of additional sources of energy with zero emissions; the utilization of waste heat; the reduction of energy lost through transmission lines; assistance with the management of power supply and demand; and the improvement of grid resilience to extreme weather.

What exactly is a microgrid, and why is it important?

A microgrid is a self-sufficient energy system that serves a specific geographic footprint, such as a college campus, hospital complex, business center, or neighborhood. Examples of these types of footprints include college campuses, hospital complexes, and business centers. The electricity that is generated by microgrids comes from one or more sources of distributed energy, such as solar panels, wind turbines, combined heat and power units, or generators.

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