Cleantech Market Intelligence
Tracking Blackouts and Microgrids: Surprises in Both Categories
The East Coast’s power outages have made headlines in recent years. Hurricanes and other bouts of severe weather have spurred on a series of state programs to promote greater resilience of the power grid, steering public dollars to new microgrids that serve communities and critical public purpose assets.
The list of states along the Eastern Seaboard now promoting microgrids keeps growing, with Rhode Island and Washington, D.C. being among the latest to join states such as New York, which just announced that it is now offering $8 million for 8 of the 83 projects originally proposed under its much-ballyhooed New York Prize program. No doubt, New Yorkers feel that they are the center of the universe when it comes to microgrids, but folks living on the West Coast may have a different perspective.
For example, I was surprised to learn that one of the leading vendors in the microgrid space—Eaton—actually tracks U.S. blackouts nationally, regionally, and by state. Eaton’s Blackout Tracker admits that it might be not complete, but it is the best data available on the duration of blackouts and numbers of customers affected. Similar to Navigant Research’s Microgrid Deployment Tracker, the data is global in scale.
Perhaps the biggest surprise in Eaton’s 2015 summary report is that California had led the nation in terms of power outages since the report was first published in 2008. Between that year and 2014, California experienced 525 power outages; New York was in second place with 399. For 2015, the tracker shows that overall power outages nationwide declined compared to 2014, but the number was still significant at 3,571. The number of customers affected by power outages in the United States also dipped slightly between 2014 and 2015, from 14.2 million to 13.2 million.
As noted in the Eaton report, extreme weather is lengthening the duration of power outages. According to estimates by the Lawrence Berkeley National Laboratory, outages are generally lasting 5%-10% longer over time. A study by the National Renewable Energy Laboratory estimated that power outages cost the U.S. economy as much as $188 billion annually. One could argue these dollars would be better spent investing in microgrids rather than being lost as a drag on the economy.
North America in the Lead
Navigant Research has estimated that the cumulative value of assets deployed within microgrids in North America could exceed $50 billion between 2015 and 2024. The next update of the Microgrid Deployment Tracker to be published in 2Q 2016 shows North America leading the world in terms of total identifiable microgrid capacity (42%) and in operational identifiable microgrid capacity (56%).
The biggest surprise in this biennial tally of global microgrid projects? The leading part of the world for energy storage deployed within microgrids is Antarctica of all places, where 100% of all systems feature energy storage. (Of course, this is an extremely small market in an extremely rugged environment.) The largest growth in terms of project entries among grid-tied microgrid segments is expected to come from utility distribution microgrids, which now represent 15% of all microgrid development activity globally. This is a clear sign that utilities are seeking to reinvent themselves in an era of climate change adaptation, increased reliance upon distributed renewables, and the emergence of new utility business models.