Utilities and global standards for microgrids

It’s worth looking at consultant Christine Hertzog’s “5 smart grid and smart city predictions for 2020″ over at Greenbiz.com. They include the prediction that certain key states like California will meet or exceed their renewable portfolio standards as well as some themes surrounding utilities’ weakening relationship with their customers.

Along the same lines of what she calls the “intermediation” of third parties into the traditional customer-utility relationship, she notes that new standards will be globally adopted for how to integrate microgrids onto the larger grid. She writes:

Specifically, there is global adoption of standards that define how to integrate or grid-tie microgrids and other standalone generation and energy storage assets for bi-directional electricity flows to utility distribution grids.

In the U.S., momentum from the commercial business sector, which fuel building as microgrid and building self-sufficiency concepts into projects, motivates utilities and regulatory agencies into proactive stances on standards development initiatives —  particularly around cybersecurity and the interoperability of privately owned microgrid management systems and standalone generation and energy storage assets with utility distribution management systems.

It’s an interesting thought because on the one hand utilities have no choice but to figure out standards for allowing microgrids to easily connect to the grid and will probably be forced to do so by regulators. But on another level, utilities have a big incentive to make it more difficult to build microgrids and to make it harder to use the grid as backup power. This trend is cutting into their revenue and customer base.

I truly believe that third parties will enter the market offering everything from microgrids to energy storage options for commercial customers. The question is how well utilities will learn to play with these new technologies and entrants.

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Adam Lesser

Analyst Gigaom Research

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