There is a new way of thinking about smart grid design and construction referred to as a microgrid. A well designed microgrid produces enough energy to meet the power needs of the users within the microgrid. A microgrid can be a prison, army base, city, university, or other local requirement. A smart microgrid is the most efficient and economic way to manage and deliver electricity to a local user base. Economic and environmental benefits to smart grid users is maximized while minimizing energy loss through transmission over long distances. Other savings are achieved through smart use of power and more distributed generation.
Increased revenue: Being able to regulate energy use in a real-time model enables utilities to save energy by managing demand response, price response, voltage support, capacity support, and spinning reserve which can result in significant revenue increases. Next generation smart microgrids also support revenue streams from distributed power generation, plug-in electric vehicle loads and renewable energy carbon credits.
Reduce costs: Smart microgrids are more reliable and can help consumers and businesses in the US save at least $150 billion per year in costs lost to due to power outages. Local generation can minimize peak power costs and the microgrid allows consumers to procure power in real-time at significantly lower costs. Local power generation is more efficient and reduces transmission losses, particularly when power costs are at their highest.
Reduces carbon footprint: A local power generator can be renewable or natural gas fueled. Often microgrids can recapture waste heat from the natural gas for other uses such as heating buildings, cooling and even refrigeration (through absorption chilling), hot water and sterilization. Smart microgrids have the flexibility needed to use a range of energy sources such as wind and solar. These efficiencies all contribute to a reduced carbon footprint
Economic benefits: Microgrids can provide new job creation at the local level and new business opportunities for entrepreneurs. Increased local investment through microgrid financing and local spending on grid improvements and integration of other smart technologies all contribute to local economic growth.
Increased reliability: Local power generation and storage allow portions of the grid and critical facilities to operate independent of the larger grid when necessary and thus eliminate blackouts. New technologies can automatically fix and even anticipate power disturbances. Microgrids can also feed the larger power grid when power demand and cost are highest by supplying electricity from renewable sources.
Can adapt to future changes: One of the greatest benefits of smart microgrids is that they are much better positioned than the centralized grid to meet the known and unknown needs of the future. Rather than having to wait for power companies to build centralized power plants, microgrids can increase the overall electricity supply quickly and efficiently through relatively small local generators such as solar cells and wind turbines.
In conclusion, smart microgrid technology empowers consumers, stimulates future electricity innovations and activates entrepreneurial free-market funding.