Renewable Energy Resilience

Nanogrids, Microgrids and Virtual Power Plants

Expert on new energy business models such as nanogrids, microgrids and virtual power plants, covering cutting edge energy and environmental issues for over 25 years.

Stone Edge Farms: Open Source Controls for California Microgrids

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 a technology component stack that is the least understood, often clouded in mystery.

The Stone Edge Farm microgrid in Sonoma, California has emerged as the poster child of microgrid innovation in the U.S. With eight kinds of different batteries all 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.

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. He instructed his interns to attack the problem of controls – and they have apparently delivered.

The watershed event was the wild fires 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,” he 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 control 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 now predicting will be the fastest growing microgrid market segment over the next decade.

“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, he believes these companies can dedicate their expertise where they best add value: in the higher level provision of grid services, a value proposition which will clearly grow over time. (DC Systems currently providers higher level tertiary controls at the farm today, a firm that just hired Ken Munson, formerly of Sunverge, as CEO.)

Ironically enough, it was the inability of Stone Edge Farm 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, rather than wade through the red tape attached to trying to sell grid services to either Pacific Gas & Electric or the California Independent System Operator. Wooster’s engineering company is now working on designs for 6 more microgrids in Sonoma County, all which incorporate renewables-to-hydrogen as a key enabling storage medium for both microgrids and as a clean transportation fuel. The success of Stone Edge Farm has helped sire the creation of Repower Capital, an investment group which is capable of plowing $60 billion into clean energy systems such as microgrids. Guess who is this entity’ largest investor? Siemens Financial.

Why Finland May Be Europe's Best Market for Microgrids

While Europe is often held up as a global leader in moving toward a low-carbon energy future, the tightly regulated European Union (EU) markets have several features which severely limit development of microgrids:


·         The focus has been on large-scale renewable energy development such as offshore wind, which requires massive investment in transmission infrastructure.

·         Deployment of distributed energy resources (DER) such as rooftop solar PV has primarily been based on feed-in tariffs (FIT), a business model precluding the key defining feature of a microgrid – the ability to seal off resources from the larger grid via islanding.

·         EU markets are tightly interwoven and methods to address the variability of renewables such as wind and solar lean toward cross-border trading, not localized microgrids.

As the forthcoming update to the Microgrid Deployment Tracker demonstrates, Europe represents approximately 9% of the global microgrid market. The vast majority of microgrids deployed in Europe are on actually islands in the Mediterranean, the Canary Islands off the coast of Spain or projects such as Bornholm or the Faroe Islands of Denmark.

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Navigant Interview with Susanna Kass, EVP Innovation and Sustainability for Baselayer on Modular, Software-defined Data Centers

No other industry may impact the future of the planet as much as data centers. They have become fundamental to the evolution of our digitized economy. Yet data centers today rely upon outdated and polluting power infrastructure to maintain up time. With outages costing more than $2 million a piece, data centers are looking for resiliency. Have they been looking at the right mix of technologies. Here is the perspective of Baselayer on the concept of a modular, soft-ware defined data center. For a perspective on the concept of "microgrids-as-a-service" being offered up by Schneider Electric, register for a Navigant Research webinar taking place at 11 am Pacific next Tuesday, October 28th at this website: 

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Integrating Transactive Energy into Virtual Power Plants - How So?

The concepts of virtual power plants (VPPs) and transactive energy (TE) are similar in that they place prosumers—formerly passive consumers that now also produce energy—front and center in an emerging market for grid services delivered by distributed energy resources (DER).

Navigant Research believes that the future of energy rests on the foundation of cleaner, distributed, and intelligent networks of power. The VPP model presents a compelling vision of the future, as does TE. When combined, new revenue streams for diverse energy market stakeholders are inevitable. The biggest question is: What portion of the VPP/TE vortex of possibilities will find its way into prosumer pockets?

Much more work needs to be done to flesh out these prospective advances, but in a new report entitled VPP Transactive Revenue Streams, I identify six grid services that I predict could become enhanced by integrating TE within the VPP framework. Much more work needs to be doneto put money into stakeholder pockets, so I’ve also briefly identified the regulatory challenges that need to be addressed to make these revenue streams real:

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Postcard from Hawaii to the Nation's Capital

The mood at the second annual VERGE conference in Honolulu, Hawaii last week was upbeat about the future of clean energy, despite pushback on the U.S. mainland. Apparently, those committed to a clean energy agenda, including the private sector, are more motivated than ever to push forward with aggressive programs to bring on-line renewables resources to not only to combat climate change, but to create jobs.

Conference attendees clearly supported the supposition that clean energy is here to stay, no matter what might be unfolding in Washington, D.C.The proposed dismantling of the federal Environmental Protection Agency’s Clean Power Plan and recent withdrawal of the U.S. from the Paris Accord on climate change only seemed to serve as motivation to push forward even harder.

Hawaii is the first (and so far) only state in the U.S. to commit to a 100% renewable energy future. Gov. David Ige of Hawaii didn’t seem to blink in the face of counter currents flowing from the Trump administration. A confessed energy geek, he seemed to take particulardelight in the fact that Hawaii has emerged as a key testing ground for bolstering commitments to infrastructure needed to integrate variable renewables for not only power, but transportation services. Since each island of Hawaii is its own separate electric grid control area, and retail costs are high due to such a reliance upon imported sources of fossil fuel, Hawaii is in a unique spot. The economics here clearly favor renewable energy.

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The Value of Diversity on Corporate Boards - A New Take

I’ve been preaching the value of diversity for quite some time in my specialized field of energy. When it comes to developing a portfolio of energy resources to supply a region, country, state or city, it is never a good idea to put all of your eggs in one basket.

For example, natural gas prices today in the United States are low. One might be tempted to shift one’s supply to natural gas in a major way – and many utilities are doing just that. It is also a resource that is cleaner than coal, and is a more flexible resource. This latter point is an important consideration as we add more variable solar and wind to the energy equation, since natural gas power plants can help fill in the gaps when the shine doesn’t shine or the wind doesn’t blow.

But California ratepayers such as I will see higher bills in 2017 since gas prices have gone up on the West Coast. The best policy in order to hedge one’s bets is to always diversify, albeit intelligently, with a mix of resources so that over the long-term one is not overexposed to risk, but can also take advantage of the see-saw nature of energy markets.

Energy is just one example, but in a business world now driven by new data streams, creative trading strategies on equities and corresponding complexity in understanding future market opportunities, diversity can take on new meanings.

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Winter Season Reveals Value of Next Generation Demand Response

Just a little over a year ago, the underground Aliso Canyon natural gas storage facility began leaking. While the primary concern was how methane emissions might jeopardize public safety, this event also created a crisis in energy supply in southern California. As it turns out, it became the largest methane leak in U.S. history. By some estimates, the leak had the equivalent impact on climate change as burning 1 billion gallons of gasoline. The value of the leaked natural gas has been estimated at more than $21 billion.

The leak from a gas field that supplied fuel for a fleet of fossil fuel plants that served as one of the backbones of the regional power supply also created an ideal market opportunity. The only way to fill in the gaps was through distributed energy resources (DER) that could be mobilized in short order.  Among the innovative solutions are virtual power plants enabled by energy storage.

California moved swiftly. The CPUC made a bold decision calling for a wide range of distributed energy resources (DER) in late May. Fortunately, Southern California Edison (SCE) and industry providers were positioned to move fast, since contracts were already in place for over 260 MW of energy storage, five times the amount SCE had been required to purchase. 

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Why VPP Software Vendors Are Vital to the Success of the Emerging Energy Cloud

The term “virtual power plant” means different things to different people. The concept is really just creative way to imagine the variety of grid services that can be harvested from a plethora of distributed energy resources (DER) that are rapidly populating power grids worldwide.

I would argue that the VPP is the epitome of changes that are transforming relationships between utilities and customers, as well as a host of other market participants that are building real solutions to the pressing energy and environmental challenges facing the world today. Navigant has coined the term the Energy Cloud to describe the evolution of our collective energy future. VPPs are just one aspect of this shift toward smarter, cleaner and smaller power sources being aggregated into real-time solutions that benefit each individual asset owner, while also contributing to the sustainability of existing infrastructure.

Now that hardware assets such as solar PV panels, batteries and other DER are becoming commoditized due to increased market penetrations and creative business models, the key to unlocking greater value from both new and existing DER is software, the fundamental technology driver underlying the VPP market. 

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Has Hitachi Zeroed In On the Most Viable Microgrid Business Model Today?

I had the pleasure of participating in an afternoon long workshop at the VERGE conference in Santa Clara last week. The workshop covered a lot of ground, including offering two different perspectives on microgrids from two leading players: Spirae, a controls and software innovator; and Hitachi, the only company in the world that has declared it has a 100-year plan for“social innovation businesses,” a broad category of solutions that includes microgrids in North America and Asia.

While the workshop covered a lot of ground, perhaps the most noteworthy portion of the program was a presentation by Urs Gisiger, director of project finance for Hitachi Energy Solutions. He directly addressed questions that seem to be a hot topic of conversation at nearly every event that addressed the hype and promise surrounding microgrids and a distributed energy future: How do we finance such projects at a time of great market uncertainty? In other words, what is the best microgrid business model

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Orchestrating Power Networks via Virtual Power Plants

The evolution of energy markets is accelerating in the direction of a greater reliance upon distributed energy resources (DER), whether those resources generate, consume or store electricity.  The new frameworks necessary to manage this increasing two-way complexity are quickly evolving. Nevertheless, strategies are being deployed today all over the globe. 

One such strategy is a virtual power plant (VPP), the concept that intelligent aggregation of DER can provide the same essential services as a traditional 24/7 centralized power plant. The definition of a VPP is fuzzy. In short, it is based on idea that the value of DER must not only provide value to the prosumer – but must be enabled (through technology and regulation) in order  to migrate value upstream to utilities and even transmission grid operators. In other words, they need to rely upon a network orchestrator, a concept that is articulated in a new white paper entitled Navigating the Energy Transformation, The Energy Cloud 2.0 – Building a Competitive Advantage.

Navigant Research published its first VPP report in 2010. Since that time what was once seen as a futuristic scenario fed by a number of experimental pilot projects in Germany, Denmark and the rest of Europe is emerging into a real market that draws upon analogies with companies such as Uber. The network orchestrator driving value for the VPP may not own all of the assets; value is created by organizing these assets in a way that creates real-time physical benefits to the power grid (or in the case of Uber, to people seeking near-immediate transportation services). 

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©2016 Peter Asmus. Photo credit: David Clites. Website by: