As the world races towards a greener future, businesses, communities and individuals alike are increasingly turning to renewable energy sources. Yet, what is particularly interesting is that many businesses are taking the proactive decision to research, select and implement their preferred solution themselves – often involving on-site solar generation and a local microgrid to distribute the power.
Leading the way are the big box retailers, whose extensive rooftops present vast potential for solar energy generation. So much so, that a report by Environment America Research & Policy Center suggested that in the US alone they have the potential to generate 84 TWh of solar electricity each year. This is enough to power almost eight million homes.
Retail giant Walmart has become a leading exponent of the microgrid trend. It is said by Environment America to have more than 72mn m2 of rooftop space throughout its estate that could be used for solar energy systems. Much of it is already in use. It currently has over 600 on and off-site renewables projects in operation or under development and has further committed to add 10 GW of clean energy capacity by the end of 2030. These are impressive numbers.
It is not just retailers that are seeing the benefits of running their own bespoke microgrids. Another key sector is data centres. They are, after all, big energy consumers that are thought to devour around 2% of the world’s electricity. The emergence of artificial intelligence (AI) technologies is only increasing their need for ever more computing power and storage.
As energy requirements continue to grow, the adoption of locally managed microgrids could provide them with the ability to minimise the impact of regional power disruptions. Microgrids can also help data centre operators take more control of their power supply.
Data centres are, after all, big energy consumers that are thought to devour around 2% of the world.
Why microgrids are good for business
This is not surprising. As well as the potential to lower costs, a microgrid empowers a business to not only control when it takes energy off the grid but also ensure it can push excess energy back to the grid when it provides the best returns.
Technology advancement is proving to be an important catalyst too. The latest AI-backed software platforms can analyse a huge amount of data in record time. This helps businesses better forecast demand, scheduling and position reporting effectively. Modern distributed energy resource management systems can also help ensure a microgrid works optimally by ensuring the energy is correctly balanced throughout the grid.
Improvements to battery technology have also played a part. Modern lithium-ion batteries have far better energy density than in the past, allowing for longer-lasting batteries in smaller, lighter packages. Additionally, many new battery technologies are quickly changing the game. Lithium-sulphur, sodium-ion, ion-air and zinc base batteries are all currently being researched and developed in order to compete with more traditional lithium-ion batteries in terms of cost, sustainability, and efficiency.
We have recently seen the theory of the microgrid go a step further, with businesses or communities banding together to create a virtual power plant (VPP) that integrates multiple distributed energy resources into a single, unified power plant. To work effectively though, VPPs need to be coordinated using advanced software platforms so that energy production, storage and consumption is optimised in real-time.
VPPs, such as those offered by Tesla, have similar benefits as microgrids – grid reliability, integration of renewables, cost-effectiveness and energy efficiencies – but these are often multiplied due to economies of scale. As such, I see no reason for their adoption to slow down.
A renewables-based energy future
Earlier this month, the UK’s National Energy System Operator (NESO), talked about the need for renewable energy capacity to expand significantly to support the UK’s goal to transition to clean power by 2030. There is no doubt that microgrids will be crucial to supporting the energy grid and moving the nation towards a more decentralised, renewable-based energy future. Costs of microgrid set-ups are coming down all the time. This eliminates one historic barrier and opens up the process to smaller and smaller companies.
Yet setting up a microgrid remains a complicated process. Batteries can still be expensive. Plus, the available space to house the solar array is necessary. Weather, location and other variables – not least increasingly stringent regulations – can also hamper progress.
However, the benefits generally outweigh the risks. Becoming one’s own energy supplier can be an attractive prospect for a business and is something I’d expect to see more and more in the future. Putting solar panels on the likes of superstores and data centres is good for businesses, good for electricity customers, good for the grid and good for the environment.
The views and opinions expressed in this article are strictly those of the author only and are not necessarily given or endorsed by or on behalf of the Energy Institute.
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