Microgrids are small-scale versions of the large, centralised electricity system. They can generate, distribute and control power in a localised environment. The concept itself is nothing new. Think of remote outback communities that have been dependent on diesel generators for their power supply. Or even the earliest electricity networks, which were basically microgrids before they were joined into regional and national grids.
Modern day microgrids have been evolving with technology. Now, while they still remain grid-connected, they are also able to form a self-contained network with its own energy supply, close to the area of consumption. Many diesel generator systems now supplement their electricity supply with energy from solar, wind, or even from energy storage systems.
"Where the smarts lie is in having a system that can maximise energy to the consumer by utilising renewable sources, and minimise diesel usage," Roland Vitelli, head of the power grids division at ABB Australia says.
ABB has been a global pioneer of microgrid technology, with more than 25 years of experience in the segment. As an original equipment supplier, it manufactures most of the parts that make up microgrids, but more importantly it has developed the technology and digital solutions that brings the system together.
"The key to making all the individual discrete components work together efficiently is a sophisticated control system, which can continually monitor the grid," Roland says. "The aim is to seamlessly provide consumers the energy from multiple sources that are quite volatile in their generation, but without consumers feeling the fluctuations in energy supply."
Microgrid technology has increasingly found use in the utility and mining sector, as well as with commercial and industrial type applications. For instance, ABB recently installed a hybrid photovoltaic solar and diesel system for a mining customer, which enabled the supply of energy from both sources. The new system resulted in reducing the miner’s diesel requirements by millions of litres a year.
The company now also installs microgrid systems that work together with energy storage devices. This allows, for example, generators to run at peak efficiency loads all the time, and if there is a problem, batteries kick in for the time required to fire up standby generators.
Economics is increasingly the major driver for microgrid usage. The application is particularly relevant to Australia, which has an abundance of remote or bushfire-prone communities in places like Western Australia, Queensland and Northern Territory, which are difficult to service through the traditional grid.
Running a new power distribution line to these communities, is expensive. The application of a microgrid integrated with energy storage would help defer that capital expenditure to a large extent.
"Consumers today are far more astute to their cost of energy and want to take more control of their energy supply and demand," Roland says. "Rather than continually being impacted by rising costs of electricity, they prefer having their own microgrid system, while retaining a thin-grid connection to the network."
Payback period for some types of microgrids has fallen to as low as three to five years. This, however, varies from application to application.
ABB expanded its presence in the segment in 2011 by acquiring Darwin-based automation firm Powercorp. The acquisition strengthened ABB’s portfolio of control technologies that allow integration of renewable energy sources. The company now maintains its Global Centre for Excellence for microgrid technology in Darwin, and it also runs an R&D team there, which works on developing the next generation of microgrids.
At the moment, a lot of Australian users are still reliant on funding or grants for the system to stack up financially. But as people have a better grasp of the concept, and the technology matures, consumers will develop more understanding of the additional, indirect benefits of microgrids rather than the direct savings of sticking with conventional solutions.
In the near future, ABB sees a multitude of applications being developed for potential users that include large infrastructure companies, land developers, large retail customers, shopping centres, and airports.
"It all comes down to the commercial viability versus traditional supply from the network," Roland concludes. "The application and opportunity is far and wide."
Article as published in the Australian Financial Review newspaper.