Navigant Research Blog

Stone Edge Farm Pioneers Open Source Controls for California Microgrids

— July 10, 2018

The importance of microgrid controls is paramount to the success of any microgrid project. It is the most important aspect of any microgrid’s performance, but is also the technology component stack that is the least understood.

The Stone Edge Farm microgrid in Sonoma, California has emerged as the poster child of microgrid innovation in the US. With eight different kinds of batteries incorporated into a single microgrid that produces hydrogen for use in vehicles, one could argue that it represents the bleeding edge in microgrid technology innovation.

Innovate for the Future: Open Source

Perhaps its most radical idea—cooked up by Craig Wooster, the project engineer for the project—is the release of an open source controller developed at the farm out of necessity. “I was pretty disappointed with the controllers we’ve tested at our microgrid, both by performance and the cost,” he said. Wooster instructed his interns to attack the problem of controls—and they have apparently delivered.

The watershed event was the wildfires that swept through Sonoma County last October. Wooster elected to run the microgrid in island mode for 10 days based on a controls system developed at the farm dubbed the Helia IQ optimizer, a distributed controller that did not require any instructions from a higher level master controller. Navigant Research believes that this distributed approach is where the industry is going, especially when responding to immediate threats to grid stability.

“Our plan all along has been to create a place where innovation can take place. And that’s what we’ve done,” Wooster added. During the fires, there was no internet (or Ethernet) to enable communications between devices, so a distributed, autonomous approach was the only way to go. The resulting controls product has been labeled as Breeze and will be available for microgrid hosts and vendors this September. Wooster thinks this open source controls approach will help accelerate growth in commercial and industrial (C&I) microgrids, which Navigant Research is projecting will be the fastest growing microgrid market segment over the next decade.

Build Lego Blocks

“The high cost of controls is often a major barrier for C&I customers to adopt microgrids,” observed Wooster. “With this distributed, open source approach, one can build up a microgrid like Lego blocks, and incrementally grow a microgrid in step with the internal growth of the company,” he added. While he observed larger controls vendors such as Siemens may view this open source approach as competition, Wooster believes these companies can dedicate their expertise where they best add value: in the higher level provision of grid services. This is a value proposition that will clearly grow over time. (DC Systems currently provides higher level tertiary controls at the farm today, a firm that just hired Ken Munson, formerly of Sunverge, as CEO.)

It was Stone Edge Farm’s inability to provide such grid services with excess energy generated at the farm that convinced Wooster to instead focus on hydrogen production for clean air vehicles. He was able to avoid wading through the red tape attached to trying to sell grid services to Pacific Gas and Electric or the California Independent System Operator. Wooster’s engineering company is now working on designs for six more microgrids in Sonoma County, all of which incorporate renewables-to-hydrogen as a key enabling storage medium for microgrids and a clean transportation fuel. The success of Stone Edge Farm has helped sire the creation of Repower Capital, an investment group that can plow $60 billion into clean energy systems such as microgrids. And this entity’s largest investor is none other than Siemens Financial.


VERGE Highlights: Lessons Learned from US Navy Microgrids in Hawaii

— June 21, 2018

Hawaii has a deep relationship with the federal Department of Defense (DOD). The bombing of Pearl Harbor in World War II by the Japanese cemented that connection in the minds of Americans.

In last year’s Military Microgrids report, Navigant Research found that military microgrids are likely to reach nearly $1 billion in annual implementation spending by 2026. If what has happened to two of Hawaii’s high profile microgrids is any indication, however, these investments may offer little in the way of actual resiliency.

At the recent VERGE conference in Honolulu, I learned that institutional, cultural, and technological challenges have plagued two microgrids deployed by the US Navy on Oahu. The good news is that lessons learned from two microgrids—part of the SPIDERS program contracts awarded to Burns and McDonnell—are now being applied to a new Pacific Energy Assurance and Resiliency Laboratory (PEARL) microgrid at Pearl Harbor for the Air Force.

Dan Lougen of the Naval Facilities Engineering Command Pacific offered a sobering view on the two SPIDERS microgrids on Hawaii, at a workshop I helped lead. The primary challenge, he said, was teaching 52-year old men new tricks with the advanced technologies that make up today’s modern microgrids.

O&M Costs Lead to Dormant Microgrids

Ross Roley, a contractor with Battelle supporting US Pacific Command’s energy innovation office and operational manager of the SPIDERS program, pointed out in an interview that each of the three SPIDERS microgrids were fully functional when completed, but operations and maintenance (O&M) challenges resulted in all three microgrids lying dormant. For SPIDERS 1 at Joint Base Pearl Harbor Hickam, a password expired and the owner/operators decided not to seek a new one, resulting “in a $4 million asset just sitting there,” said Roley. SPIDERS 2 at Fort Carson, Colorado sat idle for several years waiting for ownership policy to be sorted out. SPIDERS 3 at Camp Smith in Hawaii has run into state environmental compliance issues and is also not currently operational. “I found out O&M is more difficult than construction. The DOD will now need to spend significant dollars to bring Camp Smith back online, but if it had been maintained from the outset, the microgrid could have generated $1 million annually for peak shaving and other grid services,” he said.

Stan Osserman, director of the Hawaii Center for Advanced Transportation Technologies, observed that the SPIDERS projects taught many important lessons. “DoD’s ‘joint’ projects span all military branches, but which service is responsible to pay for ongoing operations wasn’t clear. We also found we needed to allow the prime contractor to have more control over the subcontractors, and we’re addressing both issues in PEARL,” he said.

What Will Keep PEARL and SPIDERS Up and Running?

Then there were technology lessons learned. SPIDERS was touted as being a program to develop a model for wider commercial deployment of microgrids, but all loads were transferred to old school backup diesel generators in the event of an outage. The new PEARL microgrid is designed to run on 100% renewable energy with the help of energy storage mediums including hydrogen, flywheels, ultracapacitors, and batteries. Rather than diesel generators being the primary resource when the power goes out, the PEARL microgrid delegates backup generators as a last resort.

Perhaps the most inspirational message regarding microgrids and the military at VERGE was a presentation by Nathan Johnson, an assistant professor at Arizona State University. He described retraining programs for military veterans to find new jobs in the microgrid industry, including off-grid remote systems for energy access initiatives in the developing world. Perhaps the veterans who make it through Johnson’s microgrid boot camp could return to military service, and help keep these existing SPIDERS microgrids up and running?


New Trends Point to Virtues of Fuel Cells and Direct Current for Modular Microgrids

— June 12, 2018

The beauty of a microgrid is that it can come in so many sizes. It can also incorporate many different types of distributed energy resources (DER)—from different forms of generation to creative load management and even energy storage—to bridge any gaps in supply or demand.

DER Growing Ever More Popular for Microgrids

Navigant Research has projected that both solar PV and energy storage will emerge as the two most popular DER options over the next decade. Yet, that doesn’t mean other technologies—such as fuel cells—won’t play a growing role in the microgrid universe. Perhaps the company most keen on this market opportunity is Bloom Energy, which ranks in the Top 10 vendors in terms of projects deployed in the forthcoming update to the Microgrid Deployment Tracker. The company has deployed its fuel cells in more than 60 microgrid projects, representing roughly an equal amount of megawatts. But those numbers will increase dramatically in the future.

Earlier this year, Navigant Research estimated growth in all major DER technologies going into microgrids, including fuel cells. Though relatively modest in scale, the microgrid fuel cell market is anticipated to reach nearly $2 billion in annual sales over the next decade.

Annual Fuel Cell Microgrid Capacity and Implementation Spending by Region, World Markets: 2017-2026

(Source: Navigant Research)

Optimizing Fuel Cells

Historically, fuel cells were deployed by market leaders such as Bloom Energy within single resource microgrids for clients such as data centers. These are clients that are extremely conservative in nature and are comfortable with the steady stream of electricity flowing from non-variable onsite generation. Since fuel cells can be fickle when it comes to small deviations in frequency, integrating them into microgrids featuring a plethora of variable renewable energy resources has been problematic. The emergence of lower cost energy storage solutions is beginning to change this basic assumption.

What about Direct Current?

One solid step in the direction of more advanced microgrids is Bloom Energy’s integration of a direct current (DC) bus to create a more modular structure to integrate energy storage devices into its fleet of microgrids. Working with PowerSecure, which was featured in Navigant Research’s recent ranking of microgrid controls vendors, Bloom Energy is rolling out its new DC bus platform for a fleet of microgrids to be deployed at Home Depot stores. Another big win for Bloom Energy was the integration of its new DC bus offering into the new Apple campus in Silicon Valley, whereby 4 MW of fuel cells were integrated into a 5 MWh system with its new platform. The microgrid also features 16 MW of solar PV.

Among the other vendors extolling the virtues of a DC bus are EnSync and Tecogen. The latter has perhaps the first plug-and-play microgrid offering (and also ranks in the Top 10 of vendors regarding numbers of microgrids deployed). Look for a Navigant Research report, Direct Current Distribution Networks, later this year to dig much deeper into the value proposition surrounding DC and the emergence of a modular microgrid movement.


Does the Telecom Market Point to the Best Way to Grow the Microgrid Market?

— June 7, 2018

Thomas Chadwick is the 52-year-old CEO of GI Energy, a Chicago-based company of roughly 30 people. GI Energy is working to implement lessons learned from the entry of telecoms into the staid electric utility industry by creating new microgrid development business models. A recent big microgrid project win in San Francisco and a majority stake investment by a Shell Energy affiliate have put the small company on the map.

Chadwick’s most radical idea? The auctioning of specific service territories to microgrid developers within a regulated market environment. He believes this approach would scale up the microgrid industry at a rate similar to what happened with mobile phones. “The pace of adoption of mobile phone technology is something microgrid developers can only dream about today,” he said in a recent phone interview. Chadwick observed that the curve of acceptance of mobile phones over a 20-year period beginning in 1985 led to near universal market adoption. “Even a goat herder today in Tanzania also has a mobile phone,” he noted.

Spurring Investment via Auctioning Licenses

“What we had in the 1980s were sleepy incumbent utilities that had not changed much in at least 50 years,” said Chadwick, referring to then dominant landline phone utility providers. “What I see today is spookily similar in electricity markets.” The auctioning of licenses for different mobile phone frequencies directed capital markets to invest in the upgrading of telecommunications infrastructure. As a result, he detailed, money flowed to building new networks, manufacturing more advanced equipment, advanced software, and the operators themselves.

What enabled this regulated model to work, as opposed to the more competitive approach extolled by many microgrid participants, was that in exchange for exclusive franchises, market participants agreed to a new regulatory environment. Sound familiar? This was the basic tradeoff brokered by Samuel Insull more than 100 years ago in Chicago that gave rise to the utility monopolies microgrids are helping to dismantle today.

Yet, there is a key difference today: a centralized monopoly versus a distributed model, the Energy Cloud. “It’s all about the consumers and how to make new technology attractive to them,” Chadwick continued. While consumers paid a little above the going rate for fixed-line service in the beginning, ultimately the marginal cost differential for mobile phones dropped to zero. The idea of auctioning off portions of the existing utility service territories may scare electric utilities. Nonetheless, Chadwick notes that under the telecom model, these incumbents were also allowed to bid for frequencies.

Winning in San Francisco

While the chances of Chadwick’s proposal moving forward are questionable in the near term, his company is not standing still. GI Energy’s most impressive accomplishment to date might be its winning bid for a real estate redevelopment project sponsored by FivePoint Holdings at the Hunters Point shipyard in San Francisco. GI Energy offered a unique blend of solar PV, energy storage, wastewater treatment facilities, and utility-scale geothermal to win the eco-district project.

Though there is no natural gas in the mix on this project, GI Energy believes one of its key competitive advantages is the ability to provide long-term and transparent pricing on natural gas. Multinational oil & gas company Shell views natural gas as a bridging fuel to a renewable energy future. Shell Energy is also active in California’s community choice aggregation movement, which is waking up to microgrids.

This Hunters Point project, which will include approximately 10,500 new residences, represents a new trend in the commercial and industrial microgrid market: a focus on new real estate developments. I discussed this topic at the Realcomm conference in Las Vegas.


Blog Articles

Most Recent

By Date


Building Innovations, Clean Transportation, Digital Utility Strategies, Electric Vehicles, Energy Technologies, Finance & Investing, Policy & Regulation, Renewable Energy, Transportation Efficiencies, Utility Transformations

By Author