Correction

CORE CONCEPTSCorrection for “Core Concept: Microgrids offer flexible energygeneration, for a price,” by Gayathri Vaidyanathan, which wasfirst published April 24, 2018; 10.1073/pnas.1804507115 (ProcNatl Acad Sci USA 115:4298–4300).The editors note that on page 4298, right column, last para-

graph, line 6, “995 kilowatts” should have appeared as “995 kilowatthours”; on page 4300, right column, third paragraph, line 11,“20 billion kilowatts” should have appeared as “20 billion kilowatthours”; and in the next paragraph, line 4, “52,000 kilowatts” shouldhave appeared as “52,000 kilowatt hours.” The online versionhas been corrected.

Published under the PNAS license.

Published online May 21, 2018.

www.pnas.org/cgi/doi/10.1073/pnas.1807693115

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CORE CONCEPTS

Microgrids offer flexible energy generation,for a priceGayathri Vaidyanathan, Science Writer

In the 1990s, University of Wisconsin researcher RobertLasseter was working in an academic no-man’s land.Lasseter was investigating small devices of less than100 kilowatts called microturbines that were used inbuildings as backup power generators. Some buildingshad several of these devices, and Lasseter and his stu-dents wanted them to operate synchronously as oneintegrated power-generation source.

It was a big ask. The devices weren’t designed tocooperate with each other. Link too many of them,and dangerous voltage and frequency fluctuationscould crash the setup. After several years of research,the scientists designed hardware, called controllers,that could regulate the voltage and frequencies suchthat multiple generators and loads could be addedseamlessly to form a simple power grid. They set upa proof-of-concept in Columbus, OH.

In 2002, Lasseter gave a talk at the Institute ofElectrical and Electronics Engineers Power EngineeringSociety wintermeeting titled, simply, “Microgrids,” andlaid out his vision. Microgrids should be able to operateindependently, or in “islanded”mode, from the centralgrid, he said. The system should be modular so that

new generation sources and loads can be added tothe system without additional configuration. And inmany cases, microgrids could be linked to the centralgrid, drawing or supplying power as needed from or tothe larger system (1).

It was a brave new vision for electricity generation.For the past 150 years, electricity has been generatedin large, centralized power plants and has travelledone-way through thousands of miles of high-voltagetransmission lines into people’s homes. North Ameri-can consumers consider electricity delivered at60 hertz and 110 volts to their sockets as more of aright than privilege. But doing so effectively requiresimpressive engineering to ensure that supply almostinstantaneously matches demand and that voltageand frequency are precisely managed, notes TomJahns, a researcher at the Wisconsin Energy Instituteat the University of Wisconsin–Madison.

Microgrids turn this system on its head, because thepoint of power generation becomes decentralized.These mini-utility grids contain all the basics of thegrid, from power generation sources and transmissionlines to controllers, energy-storage devices, and loads,but on a much smaller scale. They’re increasingly pow-ered by renewable energy. Electricity is stored in de-vices such as batteries and distributed to local loads.Microgrids, already in the pilot stage at several locales,could provide resilience for places such as Puerto Rico,which went almost completely dark after Hurricane Ma-ria, and could one daymake economic sense—if, that is,engineers can overcome technical hurdles and compa-nies and policymakers can overcome regulatory ones.

Empowering ConsumersIn Sonoma, CA, Stone Energy Farm, an organic farmand vineyard, runs on a complex microgrid that gen-erates 461 kilowatts of energy from a mix of solarphotovoltaics, a gas turbine, and fuel cells. The gen-erated power is stored in batteries with a total capacityof 995 kilowatt hours. Setting up the microgrid was farfrom simple, says Jorge Elizondo, lead engineer atHeila Technologies, which helped build Stone Energy.Microgrids have not yet fully achieved Lasseter’s visionof modularity, and most systems in the developedworld require months of custom engineering, althoughHeila’s mix of artificial intelligence and game theory has

A not-for-profit called Mlinda has installed about a dozen solar-poweredmicrogrids, such as this one in Sahitoli in Jharkhand, India. Image courtesyof Mlinda.

Published under the PNAS license.

4298–4300 | PNAS | April 24, 2018 | vol. 115 | no. 17 www.pnas.org/cgi/doi/10.1073/pnas.1804507115

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allowed for some degree of standardization. “You havea new device, in a typical microgrid, you have to rewritea lot of rules to account for it,” Elizondo says.

Initially, it was challenging to incorporate supply fromthousands, potentially millions, of low-voltage microgridsources into the high-voltage central grid. Each powergenerator in a microgrid—solar photovoltaics, for ex-ample—would have its own controllers for maintainingvoltage and frequency oscillations and supply–demanduncertainties. The control devices would have to co-operate with each other.

In fact, most microgrids these days have hierar-chies of controls. Primary controllers regulate voltageand frequencies of each generation device. Second-ary controllers allow communication between primarycontrollers and devices, letting the microgrid functionas a whole. Tertiary controllers enable the grid to re-spond to external signals, such as from electricitymarkets. Getting the multiple layers communicatingcan be expensive and challenging.

Complicating matters, conventional grids haveprotective devices that can detect abnormal, or faulty,currents and break the circuit to isolate a part of thesystem. Those devices do not work well in a microgrid,so new protection schemes have to be engineered.

Researchers and engineers have largely addressedthese issues and are now studying the best ways toorganize the future grid. Some big-data companiessuch as Cisco Systems, Inc. propose a highly central-ized control system in which large computers managethe entire grid from command centers that make de-cisions and communicate them to local microgrids viathe Internet. But much like the current grid, this ar-chitecture would be vulnerable to cyberattacks. Thereis a growing consensus that a distributed structure thatsplits decision making among various levels of controlwould be more robust, Jahns says. “Do you want thecontinuity of your electric power in your building to bedependent on how well the Internet is working on agiven day?” he asks.

Another issue lies in devising optimization modelsused by utilities that decide how to match needs in realtime and at low cost. These control algorithms wouldhave to accommodate the added complexity of thou-sands of low-voltage inputs in the future. “The chal-lenge of power systems is that demand and supplyessentially have to instantaneously match all the time,”says C. Lindsay Anderson, an assistant professor who isworking on these models at the Department of Bi-ological and Environmental Engineering at CornellUniversity. “It is a very precise problem.”

Cost Versus BenefitEven after the technical challenges are resolved, re-newable energy microgrids aren’t likely to be widelyadopted in the United States without mitigating reg-ulatory and economic roadblocks. The United Stateshas a Renewable Portfolio Standard requiring 10%renewable energy generation by 2020 and 25% by2025. Additionally, 30 states and the District of Co-lumbia have standards requiring that a minimumshare of electricity come from renewables. But state

regulations were written for traditional utilities and donot address the idiosyncrasies of distributed energyprojects. In some states or municipalities, selling elec-tricity to multiple customers, or crossing a public right-of-way, automatically classifies the company as a “publicutility”—hence triggering heavy regulations that privatedevelopers would rather not face.

Many states regulate the component technologiesof a microgrid individually rather than the system asan integrated benefit, says Dirk van Ouwerkerk, leadpartner for Anbaric Microgrid. Ideally, microgridsshould be made a distinct regulatory category and beallowed to participate in the wholesale and retail elec-tricity markets, he says. And the costs of interconnect-ing to a grid, which can be astronomical, should beborne equally by themicrogrid company and the utility,he adds. “We are among the few [private companies]that are trying to developmicrogrids and it’s very hard,”says van Ouwerkerk, whose company started de-veloping microgrids in 2014. “These regulatory hur-dles are formidable, and nowhere is there a solutionin sight.”

Some utilities, in their informal conversations withlocal regulators, resist decentralized power genera-tion by private companies which, they believe, couldeat into their profits or, even worse, destabilize thecentral grid. These may need a nudge from regulators.“You can have the best technology in the world, but itisn’t worth anything if the regulatory or market con-ditions are such that it can’t digest that kind of tech-nology,” Jahns says.

But a few progressive utilities are setting up theirown microgrids as experiments in cleaner power. Oneis St. Louis-based Ameren Corp., which has built autility-scale microgrid pilot in Champaign, IL, suppliedby solar, wind, natural gas, and batteries. The micro-grid is connected to the conventional grid but can alsofunction in islanded mode, supplying 1 megawatt tocustomers who are willing to pay a premium for supplyduring outages.

In the village of Sahitoli, microgrids help power irrigation for planting crops.Image courtesy of Mlinda.

Vaidyanathan PNAS | April 24, 2018 | vol. 115 | no. 17 | 4299

Experts say that it is still unclear whether it makeseconomic sense for an electricity consumer—say aNew Jersey resident who lost power during HurricaneSandy in 2014—to take part in and pay a premium fora system that provides electric power redundancy.That resident has to believe that the present value ofinvesting in the system would outweigh his or her fi-nancial loss from losing power for about a week ifanother hurricane were to hit, says Stephen Doig,managing director at the Rocky Mountain Institute. “Ithink the challenge here is there’s a lot of incumbenttech and incumbent players,” he says. “And until youcan demonstrate unequivocally that the economicsare better, it’ll be tough for people to shift.”

Developing-World SolutionsThe economics make a little more sense in the de-veloping world, particularly in Asia and Africa, wherethe central grid is either unavailable or unreliable.Microgrids in India, Indonesia, and Tanzania couldserve 212 million people, according to an analysis byAllotrope Partners.

In the villages of Jharkhand in northeast India, powerfrom the central grid is intermittent and the voltageunstable. Mlinda, a nongovernmental organization,recognized that a microgrid might help provide morereliable power. Beginning in 2016, it set up 25-kilowattsolar photovoltaic-plus-battery systems with a dieselgenerator backup in eight villages. The microgridssupply constant voltage 24 hours a day, says VijayBhaskar, country director for Mlinda.

But it wasn’t cheap. Setting it up required $75,000per village, a massive capital requirement in Indiancurrency. Mlinda sourced the money through grants,private equity, and debt. The microgrid power is threetimes as expensive as from the central grid. For thesystem to be commercially viable, it needs to operateat 85% capacity within 2 years, Bhaskar says. That canbe a challenge if the community has never had con-sistent energy access. They may not know what to dowith the electricity without an accompanying better-ment of livelihood and commerce, he says. “It’s notenough to just provide access to energy. It is impor-tant to address village development,” he says. “Thatcan happen only if you look at the livelihoods.”

To have microgrid success in the developingworld, Doig would like to see hardware standardizedso that modular components could be manufacturedin large-enough quantities and deployed quickly andcheaply (2). At present, a single company tends todevelop, build, own and operate the microgrid assetsin most nations. Having specialists responsible foreach of these functions would improve efficiency andallow more projects to become investment ready, says

Dan Schnitzer, cofounder of SparkMeter, a developerof microgrids in emerging markets whose main officeis located in Washington, DC.

Once deployed, the grid needs to operate at 70%capacity at all times to be economically viable. The bestway to achieve this target is by supplying commercialcustomers who require electricity during daytime whenresidential usage is low and solar generation is at itspeak. After dark, the more expensive backup genera-tion from batteries or diesel switches on. “If the onlypower that people draw is from 6 to 10 at night whenit’s dark, that’s not a good customer segment,” Doigsays. By following such guidelines and building on theachievements of multiple pilot projects, Doig expectsthat in the next decade microgrids will flourish acrosssub-Saharan Africa.

Schnitzer of SparkMeter says that nations needclear regulations on whether private companies areallowed to build, own, and operate microgrids andsupply electricity. Without clarity, there is a dangerthat utilities will expropriate projects, says Schnitzer.“In a lot of geographies, it’s been a wild west kind ofapproach where a lot of developers are building theirprojects at risk,” he says.

Puerto Rico RebuildsIn Puerto Rico—reeling for months after HurricaneMaria caused widespread outages, though most cus-tomers now reportedly have power—coal-fired powerplants supply almost all power. Energy entrepreneurssuch as Tesla, Inc. founder Elon Musk have suppliedsolar-plus-battery microgrids to the island, but these willnot be the sole solution, experts say. The Puerto RicoElectric Power Authority is now repairing the central gridusing the services of American utilities to bring thermalpower plants back online. In 2014, the Electric PowerAuthority supplied 3.5 million people with 20 billionkilowatt hours of power.

In comparison, the biggest solar-plus-battery micro-grid facility Tesla has demonstrated so far, on the islandof Kauai, has just 13megawatts of solar generation and52,000 kilowatt hours of battery storage capacity.Still, microgrids could be part of the solution in parts ofthe island the central grid does not reach, Doig says.Puerto Rico could even be a proof of principle for howdistributed energy generation and the central grid cancoexist in a large island in a manner that is cost efficientand resilient.

At the very least, microgrids likely would havehelped Puerto Ricans regain power and basic func-tions more quickly. “I don’t want to say that everythingwould be rosy if there were microgrids [in PuertoRico],” says Jahns, “but I will go as far as saying, I thinkit would be a whole lot better than what it is.”

1 Lasseter R, et al. (2002) Integration of distributed energy resources: The CERTS microgrid concept. Available at bnrg.eecs.berkeley.edu/∼randy/Courses/CS294.F09/MicroGrid.pdf. Accessed March 15, 2018.

2 Carlin K, et al. (2017) Energy within reach: Growing the minigrid market in sub-Saharan Africa. Available at www.rmi.org/energy_within_reach. Accessed March 15, 2018.

4300 | www.pnas.org/cgi/doi/10.1073/pnas.1804507115 Vaidyanathan