Second article in our series about microgrids
The United States’ traditional electric grid is an engineering marvel with nearly 160,000 miles of transmission lines, millions of miles of distribution lines, and over 73,000 power plants.
It delivers power throughout all of America, and it allows us to use air conditioners in the summer and heaters in the winter. One hundred years ago, electricity was a luxury, today, it is an affordable staple and absolute necessity to power our 21stcentury economy.
But the traditional, centralized electric grid is ripe for change. Large power plants can cost up to a billion dollars to build and are often located miles from population centers. As a result, transmission lines, which cost a million dollars or more per mile, must be extraneously long in order to connect the plant with the rest of the grid. These current realities should be considered necessary evils to maintain America’s electrification, and they cost ratepayers, who are sometimes captive customers, millions every year.
Moreover, as the previous post explained, both regulation and deregulation has stifled innovation and has failed ratepayers. The status quo is either endure an esoteric, regulated model that allows utilities to manipulate the market and gouge their customers or live with a deregulated market with volatile rates.
All the while, new business platforms like Uber and Airbnb have permanently altered traditional business models that a decade ago seemed unchangeable. Economists are calling the market where these new entities operate the sharing economy, and while it may seem impossible, its next breakout platform could be the energy sector because of microgrid technology.
Microgrids are small electric grids that consist of generation sources, distribution lines, and control mechanisms that switch gears and regulate voltage. According to the Department of Energy, “A microgrid is a group of interconnected loads and distributed energy resources within clearly defined electrical boundaries that acts as a single controllable entity with respect to the grid. A microgrid can connect and disconnect from the grid to enable it to operate in both grid-connected or island-mode.”
Within the service area of a microgrid, electric generation is disseminated and owned by individuals and businesses. One household may install solar panels and batteries while another might utilize a diesel or natural gas generator. Regardless, because individuals own the generating sources, thereby decentralizing generation, massive power plants and long transmission lines are rendered obsolete and no longer needed.
Distribution lines would still be required within the “defined electrical boundary” in order to connect the participants, but without the need for large power plants and long transmission lines, infrastructure costs would drop.
From powering prisons to college campuses to neighborhoods, microgrids enable communities to be independent from central electric utilities. They’re powered by a variety of sources (generators, batteries, solar panels, etc.) and are self-sufficient systems that can act in parallel with the central grid or function autonomously.
It’s Uber for Energy, or the power sectors’ neighbor-to-neighbor economy. If you’re tired of the electricity cartel and its enablers at the Public Utilities Commission who keep customers captive, maybe it’s time to think about how you, your neighbor, and community can gain independence from Colorado’s regulated monopolies by creating your own microgrid.