Micro grids are rapidly emerging as center stage of the Energy Transition, driven by a convergence of retail and EV markets. Cutting-edge technology — including sophisticated EMS controls and Automation software — is critical to ensuring that micro grids are able to scale and proliferate.
It’s a testament to just how rapid the pace of disruption has been for the U.S. power grid. This time last year — even with FERC Order 2222 waiting in the wings — the notion that distributed energy assets would drive a convergence of disparate energy markets was an unknown trend to many.
Today, that convergence is already materializing in real-time, driven by the emergence of viable micro grids around the United States. Micro grids are actively bringing together retail and EV markets. Micro grids have long been touted as a “democratization” of the historically monolithic U.S. power grid. Indeed, the catalyst for convergence has in fact been an authentically democratic one: it has been driven by the needs of the market rather than the result of centralized planning. As micro grids emerge around big box retailers, healthcare facilities and apartment buildings, the need to simultaneously integrate such assets alongside EVs at the same node is changing business models across the power industry.
The industry is responding in real time. In January, California-based Stem and French utility Engie announced an e-mobility partnership driven by the need to combine EV and storage solutions in a single bundle. Last week, San Diego-based V2G solutions provider, Nuvve, announced a partnership with Swell Energy to provide VPP solutions across EV and residential markets. These market leaders have had good reason for such strategic moves. As the power grid is effectively remade wholesale, the correct market design needs to encompass the convergence of traditionally disparate markets, if such large-scale infrastructure investments are to legitimately last decades. Going forward, new malls, apartment complexes and office parks will require such an architecture as a matter of fact. Siting BESS, solar panels and EV chargers at the same node — the central driving vision of the Acelerex software platform — will soon become a norm.
Current project planning is already incorporating this vision as a given. As these plans are implemented, the necessary solutions for managing such sites will become much more complex. Resiliency is central to any micro grid solution. Such sites are already taking the natural next step into incorporating redundancy solutions, integrating backup generators into their overall demand management strategies. Such strategies will inevitably need to incorporate both BTM services as well as wholesale market participation, the driving vision behind FERC 2222.
The technology required to manage such complexity will be a major step-change from existing levels. The sheer level of data which will need to be collected and analyzed for real-time decision-making will require continuous AI and ML. These will feed into a stacked services optimizer. The monetization of these assets will also layer on an additional complexity, as both financial and physical hedges will be utilized to manage price risks. Ultimately, what will be required to make this all work together smoothly — and the true enabler of the converged microgrid of the 21st century — will be access to a sophisticated real time site controller and EMS applications.
The sweeping macro trend behind this convergence on the micro grid is, of course, the drive for cleaner energy and the large-scale decarbonization ambitions across both the public and private sector. Until now, the first movers in pushing forward this convergence have been consumer-centric entities in the retail and residential segments. Ultimately, as the “democratization” of the U.S. power grid becomes widespread, the primary actors will be the utilities themselves. Given the brisk pace of change in the U.S. power grid, that moment might be closer than many currently believe.