18
Microgrid in Smart Grid Market Size, Key Issues, Regulations and Outlook to 2020 GDSG0027MAR / Published March 2013

Microgrid in Smart Grid · Microgrid in Smart Grid Market Size, Key Issues, Regulations and Outlook to 2020 GDSG0027MAR / Published March 2013

  • Upload
    others

  • View
    0

  • Download
    0

Embed Size (px)

Citation preview

Page 1: Microgrid in Smart Grid · Microgrid in Smart Grid Market Size, Key Issues, Regulations and Outlook to 2020 GDSG0027MAR / Published March 2013

Microgrid in Smart Grid Market Size, Key Issues, Regulations and Outlook to 2020 GDSG0027MAR / Published March 2013

Page 2: Microgrid in Smart Grid · Microgrid in Smart Grid Market Size, Key Issues, Regulations and Outlook to 2020 GDSG0027MAR / Published March 2013

Microgrid in Smart Grid - Market Size, Key Issues, Regulations and Outlook to 2020

GDSG0027MAR / Published MAR 2013 Page 2

© GlobalData. This report is a licensed product and is not to be copied, reproduced, shared or resold in any form

North America Dominates the Microgrid Market in 2011

The global market for microgrid is currently driven by North America, which accounts for XX% of the global revenue in 2011. The North American microgrid market has observed considerable growth during the past few years and has been primarily driven by the need to reduce the strain on the power grid in the US, increased emphasis on reducing Greenhouse Gas (GHG) emissions, and improving supply security and reliability by integrating a larger number of distributed generation sources. During the forecast period until 2020, the Europe and Asia-Pacific markets are also expected to develop rapidly.

Microgrid Market, Global, Regional Segmentation (%), 2011

North America

Europe

Asia-Pacific

Rest of the World

Source: GlobalData; Primary interviews with global microgrid market industry experts

Developing Countries Will Emerge as the Largest Market for Microgrid Technologies

The global market for microgrid technologies will be driven by developing countries such as India, China and South Africa during 2012-2020. In 2011, the US contributed around XX% of the revenue to the global microgrid market. There have been number of grid-connected microgrid projects that have been deployed in the US, with the intention of reducing the strain on the national grid, and this is expected to continue in the future as well. However, the global market is expected be driven by the developing markets in Eastern and Southern European countries, China, India, Japan, Australia, South Africa and Brazil. The need to provide electricity to the population residing in remote locations is expected to drive the market in Europe and Asia-Pacific.

Emphasis on Security of Power Supplies to Drive the Market

The growing number of installations of renewable energy resources that operate at low voltage levels and the increasing efforts of governments to improve the security and reliability of their electricity supplies are the major factors driving the current microgrid market. Complete dependence on the existing power grid is creating significant stress on existing infrastructure and can increase the risks of consumer vulnerability to unreliable power supplies. Additionally, many countries such as Australia and the US need to significantly upgrade their transmission systems to meet their growing electricity demand, which could prove to be very expensive if done through traditional centralized methods. A microgrid system has the ability to operate as an island system that provides reliable power to its immediate consumers, and can also support the wider grid when required. This offers a lot of stability to the entire electricity infrastructure and also reduces the demand load on the transmission and distribution system, so microgrids could prove to be an economical alternative to countries looking to update their electricity infrastructure. Additionally, there are many regions around the world that have regions which are isolated from the country’s central, national electricity grid, and it is very expensive to connect such areas to the existing grid. So, as a cheaper alternative, these areas could be electrified by equipping them with remote microgrids.

Page 3: Microgrid in Smart Grid · Microgrid in Smart Grid Market Size, Key Issues, Regulations and Outlook to 2020 GDSG0027MAR / Published March 2013

Microgrid in Smart Grid - Market Size, Key Issues, Regulations and Outlook to 2020

GDSG0027MAR / Published MAR 2013 Page 3

© GlobalData. This report is a licensed product and is not to be copied, reproduced, shared or resold in any form

1 Table of Contents 1 Table of Contents ............................................................................................................................ 3

1.1 List of Tables ............................................................................................................................. 5 1.2 List of Figures............................................................................................................................ 6

2 Introduction ..................................................................................................................................... 7 2.1 Microgrid Overview .................................................................................................................... 7 2.2 Role of Microgrid in Smart Grid .................................................................................................. 8 2.3 GlobalData Report Guidance ..................................................................................................... 9

3 Global Market for Microgrid ............................................................................................................ 10 3.1 Microgrid Market, Global, Annual Revenues, 2011-2020 ........................................................... 11 3.2 Microgrid Market, Global, Regional Segmentation of Market, 2011 ............................................ 13 3.3 Microgrid Market, Global, Key Drivers, 2012-2020 .................................................................... 14

3.3.1 Increasing the Power Security of Supply .......................................................................... 14 3.3.2 Emphasis on Minimizing Greenhouse Gas Emissions ...................................................... 14 3.3.3 High Cost of Transmission and Distribution Infrastructure................................................. 15 3.3.4 Emphasis on Improving Electrification ............................................................................. 15 3.3.5 Minimize Transmission and Distribution Losses ............................................................... 15

3.4 Microgrid Market, Global, Key Barriers, 2012-2020 ................................................................... 16 3.4.1 High Cost of Microgrid Technologies ............................................................................... 16 3.4.2 Instability Emerging from Intermittency of Microgrids ........................................................ 16 3.4.3 Insufficient Regulatory Support for Microgrid Deployments ............................................... 16

3.5 Microgrid Market, Global, Key Standards, 2011 ........................................................................ 17 3.5.1 IEEE Standards .............................................................................................................. 17 3.5.2 China’s Standards .......................................................................................................... 18

3.6 Microgrid, Global, Key Applications, 2012................................................................................. 19 3.6.1 Military Microgrids ........................................................................................................... 19 3.6.2 Institution and Campus Microgrid .................................................................................... 19 3.6.3 Community and Utility Microgrid ...................................................................................... 19 3.6.4 Island and Remote Microgrids ......................................................................................... 19

4 Microgrid Market, North America, 2011-2020 .................................................................................. 20 4.1 Microgrid Market, North America, Annual Revenue, 2011-2020................................................. 20 4.2 Microgrid Market, the US, 2011-2020 ....................................................................................... 22

4.2.1 Microgrid Market, the US, Annual Revenue, 2011-2020 ................................................... 23 4.2.2 Microgrid Market, the US, Regulatory Scenario, 2012 ...................................................... 24 4.2.3 Microgrid Market, the US, Key Projects, 2012 .................................................................. 25

4.3 Microgrid Market, Canada, 2011-2020...................................................................................... 26 4.3.1 Microgrid Market, Canada, Annual Revenue, 2011-2020 .................................................. 26 4.3.2 Microgrid Market, Canada, Key Regulations, 2012 ........................................................... 27 4.3.3 Microgrid Market, Canada, Key Projects, 2012 ................................................................ 28

5 Microgrid Market, Europe, 2011-2020 ............................................................................................. 29 5.1 Microgrid Market, Europe, Annual Revenue, 2011-2020 ........................................................... 30 5.2 Microgrid Market, Germany, 2011-2020 ................................................................................... 32

5.2.1 Microgrid Market, Germany, Annual Revenue, 2011-2020 ................................................ 32 5.2.2 Microgrid Market, Germany, Regulatory Scenario, 2012 ................................................... 34 5.2.3 Microgrid Market, Germany, Key Projects, 2012 .............................................................. 34

5.3 Microgrid Market, the UK, 2011-2020 ....................................................................................... 35 5.3.1 Microgrid Market, the UK, Annual Revenue, 2011-2020 ................................................... 35 5.3.2 Microgrid Market, the UK, Regulatory Scenario, 2012 ...................................................... 37 5.3.3 Microgrid Market, the UK, Key Projects, 2012 .................................................................. 38

5.4 Microgrid Market, Netherlands, 2011-2020 ............................................................................... 39 5.4.1 Microgrid Market, Netherlands, Annual Revenue, 2011-2020 ........................................... 40 5.4.2 Microgrid Market, Netherlands, Regulatory Scenario, 2012 .............................................. 41 5.4.3 Microgrid Market, Netherlands, Key Projects, 2012 .......................................................... 42

6 Microgrid Market, Asia-Pacifc, 2011-2020 ....................................................................................... 43 6.1 Microgrid Market, Asia-Pacific, Annual Revenue, 2011-2020..................................................... 43 6.2 Microgrid Market, China, 2011-2020......................................................................................... 45

6.2.1 Microgrid Market, China, Annual Revenue, 2011-2020 ..................................................... 45 6.2.2 Microgrid Market, China, Regulatory Scenario, 2012 ........................................................ 47 6.2.3 Microgrid Market, China, Key Projects, 2012 ................................................................... 48

6.3 Microgrid Market, India, 2011-2020 .......................................................................................... 49

Page 4: Microgrid in Smart Grid · Microgrid in Smart Grid Market Size, Key Issues, Regulations and Outlook to 2020 GDSG0027MAR / Published March 2013

Microgrid in Smart Grid - Market Size, Key Issues, Regulations and Outlook to 2020

GDSG0027MAR / Published MAR 2013 Page 4

© GlobalData. This report is a licensed product and is not to be copied, reproduced, shared or resold in any form

6.3.1 Microgrid Market, India, Annual Revenue, 2011-2020 ...................................................... 49 6.3.2 Microgrid Market, India, Regulatory Scenario, 2012 ......................................................... 51 6.3.3 Microgrid Market, India, Key Projects, 2012 ..................................................................... 52

6.4 Microgrid Market in Other Key Asia-Pacific Countries ............................................................... 53 6.4.1 Japan ............................................................................................................................. 53 6.4.2 Australia ......................................................................................................................... 53 6.4.3 Republic of Korea ........................................................................................................... 54

7 Microgrid Market, Rest of the World, 2011-2020 ............................................................................. 55 8 Microgrid Implementation Cost Analysis ......................................................................................... 57

8.1 Microgrid, Cost-Benefit Analysis, 2011 ..................................................................................... 58 9 Microgrid Technology ..................................................................................................................... 60

9.1.1 Microgrid Technologies ................................................................................................... 60 10 Vendor Landscape Analysis of Microgrid Players ............................................................................ 62

10.1 Key Profiles ............................................................................................................................. 62 10.1.1 Honeywell ...................................................................................................................... 62 10.1.2 General Electric Company .............................................................................................. 62 10.1.3 Lockheed Martin ............................................................................................................. 62 10.1.4 Schneider Electric ........................................................................................................... 63 10.1.5 Siemens ......................................................................................................................... 63 10.1.6 Outback Power ............................................................................................................... 63 10.1.7 General Microgrid ........................................................................................................... 63 10.1.8 ZBB Energy Corporation ................................................................................................. 64 10.1.9 ABB ............................................................................................................................... 64 10.1.10 Echelon Corporation ....................................................................................................... 65

10.2 Vendor Landscape Analysis ..................................................................................................... 65 10.2.1 Product Diversity ............................................................................................................ 66 10.2.2 Projects .......................................................................................................................... 66 10.2.3 Geographic Diversity....................................................................................................... 66 10.2.4 End-user Applications ..................................................................................................... 67

11 Appendix ....................................................................................................................................... 68 11.1 Definitions ............................................................................................................................... 68

11.1.1 Microgrid ........................................................................................................................ 68 11.1.2 Smart Grid ...................................................................................................................... 68 11.1.3 Renewable Energy Resources ........................................................................................ 68 11.1.4 Distributed Generation .................................................................................................... 68 11.1.5 Power............................................................................................................................. 68 11.1.6 Electricity Generation ...................................................................................................... 68 11.1.7 Transmission network ..................................................................................................... 68 11.1.8 Transmission and distribution loss ................................................................................... 68

11.2 Abbreviations .......................................................................................................................... 69 11.3 Bibliography ............................................................................................................................ 71 11.4 Methodology ........................................................................................................................... 73

11.4.1 Coverage ....................................................................................................................... 73 11.4.2 Secondary Research ...................................................................................................... 73 11.4.3 Primary Research ........................................................................................................... 73 11.4.4 Definitions, Market Estimates and Assumptions ............................................................... 74

11.5 Contact Us .............................................................................................................................. 74 11.6 Disclaimer ............................................................................................................................... 74

Page 5: Microgrid in Smart Grid · Microgrid in Smart Grid Market Size, Key Issues, Regulations and Outlook to 2020 GDSG0027MAR / Published March 2013

Microgrid in Smart Grid - Market Size, Key Issues, Regulations and Outlook to 2020

GDSG0027MAR / Published MAR 2013 Page 5

© GlobalData. This report is a licensed product and is not to be copied, reproduced, shared or resold in any form

1.1 List of Tables Table 1: Microgrid Market, Global, Annual Revenue, $bn, 2011-2020 ................................................ 12 Table 2: Microgrid Market, Global, Regional Segmentation (%), 2011 ................................................ 13 Table 3: Microgrid, Global, Targets for Greenhouse Gas Emission Reduction, 2020 ........................... 14 Table 4: Microgrid, Global, Key Standards for Microgrid Technologies ............................................... 17 Table 5: Microgrid, Global, Developing Standards for Microgrid technologies ..................................... 17 Table 6: Microgrid Market, China, Standards for Microgrid Deployment, 2011 .................................... 18 Table 7: Microgrid Market, North America, Annual Revenue, $bn, 2011-2020 .................................... 21 Table 8: Microgrid Market, the US, Percentage Contribution by End-use (%), 2011 ............................ 22 Table 9: Microgrid Market, the US, Annual Revenue, $bn, 2011-2020 ................................................ 23 Table 10: Microgrid Market, Canada, Annual Revenue, $m, 2011-2020 ............................................... 27 Table 11: Microgrid Market, Europe, Microgrid Projects, 2010-2011 ..................................................... 29 Table 12: Microgrid Market, Europe, Annual Revenue, $bn, 2011-2020 ............................................... 31 Table 13: Microgrid Market, Germany, Annual Revenue, $m, 2011-2020 ............................................. 33 Table 14: Microgrid Market, the UK, Annual Revenue, $m, 2011-2020 ................................................. 36 Table 15: Microgrid Market, Netherlands, Percentage Contribution by End-use (%), 2011 .................... 39 Table 16: Microgrid Market, Netherlands, Annual Revenue, $m, 2011-2020 ......................................... 40 Table 17: Microgrid market, Asia-Pacific, Annual Revenue, $bn, 2011-2020 ........................................ 44 Table 18: Microgrid Market, China, Annual Revenue, $m, 2011-2020 .................................................. 46 Table 19: Microgrid, China, Target for Distributed Generation Technologies, 2011 ............................... 47 Table 20: Microgrid Market, China, Project Overview, 2011 ................................................................. 48 Table 21: Microgrid Market, India, Annual Revenue, $m, 2011-2020 .................................................... 50 Table 22: Microgrid Market, Rest of the World, $m, 2011-2020 ............................................................ 56 Table 23: Microgrid, Major Cost Components of Microgrid Project, 2011 .............................................. 57 Table 24: Microgrid Market, Cost Benefits to Stakeholders in Microgrid, 2011 ...................................... 59 Table 25: List of Abbreviations............................................................................................................ 69

Page 6: Microgrid in Smart Grid · Microgrid in Smart Grid Market Size, Key Issues, Regulations and Outlook to 2020 GDSG0027MAR / Published March 2013

Microgrid in Smart Grid - Market Size, Key Issues, Regulations and Outlook to 2020

GDSG0027MAR / Published MAR 2013 Page 6

© GlobalData. This report is a licensed product and is not to be copied, reproduced, shared or resold in any form

1.2 List of Figures Figure 1: Microgrid Market, Global, Annual Revenue, $bn, 2011-2020 ................................................ 11 Figure 2: Microgrid Market, Global, Regional Segmentation (%), 2011 ................................................ 13 Figure 3: Microgrid Market, North America, Annual Revenue, $bn, 2011-2020 .................................... 20 Figure 4: Microgrid Market, the US, Percentage Contribution by End-use (%), 2011 ............................ 22 Figure 5: Microgrid Market, the US, Annual Revenue, $bn, 2011-2020 ................................................ 23 Figure 6: Microgrid Market, Canada, Annual Revenue, $m, 2011-2020 ............................................... 26 Figure 7: Microgrid Market, Europe, Annual Revenue, $bn, 2011-2020 ............................................... 30 Figure 8: Microgrid Market, Germany, Annual Revenue, $m, 2011-2020 ............................................. 32 Figure 9: Microgrid Market, the UK, Annual Revenue, $m, 2011-2020 ................................................. 35 Figure 10: Microgrid Market, Netherlands, Percentage Contribution by End-use (%), 2011 .................... 39 Figure 11: Microgrid Market, Netherlands, Annual Revenue, $m, 2011-2020 ......................................... 40 Figure 12: Microgrid Market, Asia-Pacific, Annual Revenue, $bn, 2011-2020 ........................................ 43 Figure 13: Microgrid Market, China, Annual Revenue, $m, 2011-2020 .................................................. 45 Figure 14: Microgrid Market, India, Annual Revenue, $m, 2011-2020 .................................................... 49 Figure 15: Microgrid Market, Rest of the World, $m, 2011-2020 ............................................................ 55 Figure 16: Microgrid Market, Global, Vendor Landscape Analysis, 2012................................................ 65

Page 7: Microgrid in Smart Grid · Microgrid in Smart Grid Market Size, Key Issues, Regulations and Outlook to 2020 GDSG0027MAR / Published March 2013

Microgrid in Smart Grid - Market Size, Key Issues, Regulations and Outlook to 2020

GDSG0027MAR / Published MAR 2013 Page 7

© GlobalData. This report is a licensed product and is not to be copied, reproduced, shared or resold in any form

2 Introduction The present power delivery sources and networks used in power systems have been in place from the turn of last century, since the emergence of poly-phase alternating current systems. The increased demand of electricity has occurred due to the growing Gross Domestic Product (GDP), which has led to increased industrial development, along with commercial buildings and other infrastructural requirements in the development of economies. In order to produce cleaner power and also increase the security, reliability and availability of power in recent years, various small-scale generation options such as distributed generation along with adoption of cleaner energy forms such as renewable energy and Combined Heat and Power (CHP) have been adopted. These developments in the present power systems show an increasing change in the way electricity is generated and distributed across the network. As a result, the presently dominant centralized system will eventually be supported significantly by microgrid systems. Small-scale power generators are interconnected, forming a combination of distribution networks known as microgrids. These networks could supply power to the central grid in the case of shortages, giving stability, reliability and security to the entire power system. This system enables greater flexibility and the optimization of power delivery sources, providing added value to the entire power delivery system.

The US Department of Energy (DOE) defines a microgrid as: “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.”

2.1 Microgrid Overview The microgrid is an integrated network of power delivery systems consisting of a power generating system, storage systems, power electronics and load. It can also be viewed as a small and an independent electricity grid. The power generating systems usually consist of sources such as photovoltaic, CHP, wind, biomass, biofuel and fuel cells. The storage systems can be flywheels, energy capacitors, and batteries and controllable loads.

Microgrids help to improve power quality, reliability, reduce carbon dioxide (CO2) emissions, diversify energy resources, encourage local power generation, and provide economic benefits to consumers and grid operators. Microgrids can function in two modes by changing their grid connection status, and these are as follows:

On-grid/grid-connected mode - In this mode, the microgrid is connected to the local distribution area network. The grid is capable of acting as an independent system but it is also connected to the central grid. The interconnection can later be used to import and export electricity, based on the tariff rates and local standards for interconnection or other ancillary services.

Off-grid/island mode - In this mode, the microgrid is an independent system that is not connected to the main grid. This microgrid uses local resources to manage the flow power, voltage and frequency and, if required, for shedding load, while remaining isolated from the distributed network or the main grid.

Page 8: Microgrid in Smart Grid · Microgrid in Smart Grid Market Size, Key Issues, Regulations and Outlook to 2020 GDSG0027MAR / Published March 2013

Microgrid in Smart Grid - Market Size, Key Issues, Regulations and Outlook to 2020

GDSG0027MAR / Published MAR 2013 Page 9

© GlobalData. This report is a licensed product and is not to be copied, reproduced, shared or resold in any form

2.3 GlobalData Report Guidance This report discusses the global and regional microgrid markets. It also provides the markets for key countries such as the US, Canada, the UK, Germany, China and India. It explains the dynamics of the microgrid industry and identifies key market drivers and policies, and provides cost-benefit analyses for microgrid. The layout of the report is as follows:

The report begins with an executive summary, which details the key findings of the report.

Chapter three provides an analysis of the global market for microgrids, including a market revenue forecast through to 2020, analysis of key drivers and restraints, and key applications and standards for the technology.

Chapter four provides an analysis of the North American microgrid market, which includes revenue forecast through to 2020. The chapter also covers the key regulations and key projects for the US and Canada. Additionally, the segmentation of 2011 revenue by end consumer is covered for the US market.

Chapter five provides an analysis of the European microgrid market, which includes revenue forecast through to 2020. The chapter also covers the key regulations and key projects for the UK and Germany.

Chapter six provides analysis of the Asia-Pacific microgrid market and includes a revenue forecast through 2020. The chapter also covers the key regulations and key projects for China and India.

Chapter seven provides revenue forecasts until 2020 for the ROW microgrid market.

Chapter eight provides the cost and benefits analysis of the microgrid system for its stakeholders.

Chapter nine provides an analysis of microgrid technology and identifies key technology trends in the global market.

Please note: the scope of the market analysis data provided in the report for global, regional and key countries is limited to generation systems, energy storage systems, power electronics, systems and software for microgrid management.

For the purpose of the report, North America consists of only the US and Canada. Mexico and Greenland are considered part of the ROW market.

Page 9: Microgrid in Smart Grid · Microgrid in Smart Grid Market Size, Key Issues, Regulations and Outlook to 2020 GDSG0027MAR / Published March 2013

Microgrid in Smart Grid - Market Size, Key Issues, Regulations and Outlook to 2020

GDSG0027MAR / Published MAR 2013 Page 11

© GlobalData. This report is a licensed product and is not to be copied, reproduced, shared or resold in any form

3.1 Microgrid Market, Global, Annual Revenues, 2011-2020 The growth of the global microgrid market in is affected by a number of factors. Key factors include the drive by governments to improve power quality and reliability in their grid, national targets for minimizing GHG, the drive to improve the integration of Distributed Energy Resources (DER) and provide power to areas that are not connected to the centralized power grid are driving the market globally. However, the high technology cost, lack of proper regulations or standards for the deployment of microgrid technologies are restricting the growth of the market. The global microgrid market is currently driven by North America, and the US accounts for a dominating share of XX% of the global microgrid revenue in 2011. The country has constructed a number of microgrid projects in order to reduce the strain on the national grid, and this is expected to drive the US market in the future as well. However, in the coming years until 2020, the global market will be driven by developing countries in Europe, China and India in Asia-Pacific and the ROW region. The market in these regions will be driven by widespread deployments of remote or island microgrid locations. The global market revenue for microgrid was around $XX billion in 2011 and it is expected to grow at a Compound Annual Growth Rate (CAGR) of XX% during 2012-2020, as shown in the figure below.

Figure 1: Microgrid Market, Global, Annual Revenue, $bn, 2011-2020

2011 2012 2013 2014 2015 2016 2017 2018 2019 2020

Annu

al R

even

ue ($

bn)

Source: GlobalData; Primary interviews with global microgrid market industry experts

Page 10: Microgrid in Smart Grid · Microgrid in Smart Grid Market Size, Key Issues, Regulations and Outlook to 2020 GDSG0027MAR / Published March 2013

Microgrid in Smart Grid - Market Size, Key Issues, Regulations and Outlook to 2020

GDSG0027MAR / Published MAR 2013 Page 12

© GlobalData. This report is a licensed product and is not to be copied, reproduced, shared or resold in any form

Table 1: Microgrid Market, Global, Annual Revenue, $bn, 2011-2020 Year Annual Revenue ($bn)

2011

2012

2013

2014

2015

2016

2017

2018

2019

2020

Source: GlobalData; Primary interview with global microgrid market industry experts

Page 11: Microgrid in Smart Grid · Microgrid in Smart Grid Market Size, Key Issues, Regulations and Outlook to 2020 GDSG0027MAR / Published March 2013

Microgrid in Smart Grid - Market Size, Key Issues, Regulations and Outlook to 2020

GDSG0027MAR / Published MAR 2013 Page 22

© GlobalData. This report is a licensed product and is not to be copied, reproduced, shared or resold in any form

4.2 Microgrid Market, the US, 2011-2020 The US market has been an incubator for many new technologies over the years, and has similarly been testing and deploying microgrid technology since the early 2000s. The government in the US started implementing and testing microgrid technologies due to the following reasons:

To minimize dependence on fossil fuels

To improve energy security and reliability

To increase economic efficiency of power consumption through peak-shaving and participating in demand response programs and other programs that make energy trading possible

To gain environmental benefits by reducing carbon emissions from the power sector

In addition to these factors, the high strain on the current national electricity grid is the key factor for the US adopting microgrid projects. However, the military places more importance on energy security in its use of microgrids, whereas university campuses such as in Boston place more importance on the economic benefits of microgrid projects. In the US, grid-connected microgrid projects are preferred to islanded microgrids, as they help to reduce the strain on the central power grid.

The US is a major contributor to the global microgrid market and is expected to drive its growth during 2012-2017. In 2011, the US constituted around XX% of the global microgrid market revenue. Most of the microgrid projects deployed in the US are undertaken by the DOD and account for about XX% of the total projects deployed. In addition to military microgrids, the US also observed significant increase in the number of university campus microgrids during 2011. However, they contributed only XX% of the total number of microgrid projects deployed in the US in 2011. Microgrids were also deployed for residential and commercial applications in the US and these segments contributed around XX% each as of 2011.

Figure 4: Microgrid Market, the US, Percentage Contribution by End-use (%), 2011

Military

Campus

Residential/Community

Commercial

Source: GlobalData; Primary interviews with North America microgrid market industry experts

Table 8: Microgrid Market, the US, Percentage Contribution by End-use (%), 2011 Application Percentage Contribution by End-use (%)

Military

Campus

Residential/Community

Commercial

Source: GlobalData. Primary interviews with North America microgrid market industry experts

Page 12: Microgrid in Smart Grid · Microgrid in Smart Grid Market Size, Key Issues, Regulations and Outlook to 2020 GDSG0027MAR / Published March 2013

Microgrid in Smart Grid - Market Size, Key Issues, Regulations and Outlook to 2020

GDSG0027MAR / Published MAR 2013 Page 68

© GlobalData. This report is a licensed product and is not to be copied, reproduced, shared or resold in any form

11 Appendix

11.1 Definitions 11.1.1 Microgrid The microgrid consists of interconnected loads and distributed energy resources which together act as a single controllable entity. This entity has the capability to function as a separate grid system and it can connect or disconnect from the grid according to the requirement.

11.1.2 Smart Grid A smart grid is an electrical grid that uses information and communications technology to gather and act on information, such as information about the behaviors of suppliers and consumers, in an automated fashion to improve the efficiency, reliability, economics, and sustainability of the production and distribution of electricity.

11.1.3 Renewable Energy Resources Naturally replenishing energy resources are limited in the amount of energy that is available per unit of time. For example, biomass, geothermal, solar, and wind can all be termed renewable resources.

11.1.4 Distributed Generation Distributed generation is also call on-site generation that produces energy from small-scale energy sources

11.1.5 Power Power is the rate at which energy is produced or transferred. It is expressed in Watts, Kilowatts (KW) or Megawatts (MW)

11.1.6 Electricity Generation The process of producing electricity by transforming other forms of energy into electrical energy, measured in Gigawatt-hours (GWh).

11.1.7 Transmission network High voltage transmission lines that connect power plants to multiple substations near a populated area.

11.1.8 Transmission and distribution loss Electric energy lost due to the transmission and distribution of electricity.

Page 13: Microgrid in Smart Grid · Microgrid in Smart Grid Market Size, Key Issues, Regulations and Outlook to 2020 GDSG0027MAR / Published March 2013

Microgrid in Smart Grid - Market Size, Key Issues, Regulations and Outlook to 2020

GDSG0027MAR / Published MAR 2013 Page 69

© GlobalData. This report is a licensed product and is not to be copied, reproduced, shared or resold in any form

11.2 Abbreviations Table 25: List of Abbreviations Abbreviation Full Form

AEP American Electric Power

BCIT British Columbia Institute of Technology

CAGR Compound Annual Growth Rate

CAT Centre for Alternative Technology

CCC Committee on Climate Change

CEC California Electricity Commission

CEF Clean Energy Fund

CEH Creative Energy Homes

CERTS Consortium for Electric Reliability Technology Solutions

CHP Combined Heat and Power

CO2 Carbon Dioxide

DECC Department of Energy and Climate Change

DER Distributed Energy Resources

DER-CAM Distributed Energy Resources Customer Adoption Model

DESI Decentralised Energy Systems (I) Pvt. Ltd

DFKI German Research Centre for Artificial Intelligenc

DG Distributed Generation

DNO Distribution Network Operator

DOD US Department of Defense

DOE US Department of Energy

DR Distributed Resource

EEAP Energy Efficiency Action Plan

EEG Erneuerbare-Energien-Gesetz

EIA Energy Information Administration

EISA Energy Independence and Security Act

EPS Electric Power System

ESM Energy Surety Microgrid

EU European Union

FITS Feed-in-tariff

FP Framework Program

GB Guojia Biaozhun

GDP Gross Domestic Product

GE General Electric

GHG Greenhouse Gases

GW Gigawatts

GW Gigawatts

HAN Home Area Network

HARP Hydrogen Assisted Renewable Power System

HPS Husk Power Systems

ICE Innova2ve Clean Energy Fund

IEC International Electrotechnical Commission

IEEE Institute of Electrical and Electronics Engineers

Page 14: Microgrid in Smart Grid · Microgrid in Smart Grid Market Size, Key Issues, Regulations and Outlook to 2020 GDSG0027MAR / Published March 2013

Microgrid in Smart Grid - Market Size, Key Issues, Regulations and Outlook to 2020

GDSG0027MAR / Published MAR 2013 Page 70

© GlobalData. This report is a licensed product and is not to be copied, reproduced, shared or resold in any form

INAC Indian and Northern Affairs Canada

IPP Independent Power Producer

KERI Korea Electrotechnology Research Institute

KIT Karlsruhe Institute of Technology

kW Kilowatt

kWp kilowatts-peak

LAN Local Area Network

MEM Microgrid Energy Management

MGCs Microgrid customers

MNRE Ministry of New and Renewable Energy Government of India

MVA Megavolt Ampere

MW Megawatt

MWh Megawatt-hour

NaS Sodium sulfur

NEA National Energy Administration

NEDO New Energy and Industrial Technology Development Organization

NIST National Institute of Standards and Technology

NREAP National Renewable Energy Action Plan

O&M Operation and Maintenance

OE Office of Electricity Delivery and Energy Reliability

p/kWh pence per kilowatt hour

PHEV Plug-in Hybrid Vehicles

PIER Public Interest Energy Research Program

PV Photovoltaic

R&D Research and Development

RDSI Renewable and Distributed Systems Integration

RES-E Renewable Energy Supply -Electricity

RHI Renewable Heat Incentive

ROW Rest of the World

SCADA Supervisory Control and Data Acquisition

SDE Stimuleringsregeling Duurzame Energie

SGCC State Grid Corporation China

SNL Sandia National Laboratory

SPIDERS Smart Power Infrastructure Demonstration for Energy Reliability and Security

STDC Sustainable Development Tech. Canada

T&D Transmission and Distribution

USTDA U.S. Trade and Development Agency

VRB Vanadium Radox Batteries

WAN Wide Area Network

WD Western Economic Diversification Canada

Source: GlobalData

Page 15: Microgrid in Smart Grid · Microgrid in Smart Grid Market Size, Key Issues, Regulations and Outlook to 2020 GDSG0027MAR / Published March 2013

Microgrid in Smart Grid - Market Size, Key Issues, Regulations and Outlook to 2020

GDSG0027MAR / Published MAR 2013 Page 71

© GlobalData. This report is a licensed product and is not to be copied, reproduced, shared or resold in any form

11.3 Bibliography CAT (2009). Turned on! The UK’s First Micro Grid Goes Online. Centre for Alternate Technology.

Available from: http://blog.cat.org.uk/2009/09/02/turned-on-the-uk%E2%80%99s-first-island-micro-grid-goes-online/ [Accessed on November 28, 2012]

CSIRO (2012). Microgrid Grid Research In Australia. Commonwealth Scientific and Industrial Research Organisation. Available from: http://der.lbl.gov/sites/der.lbl.gov/files/jeju_cornforth.pdf

Dabell. J (2011). An Overview of Smart Grid Research at BCIT. British Columbia Institute of Technology. Available from: http://www.bcit.ca/files/appliedresearch/pdf/arc_group_for_advanced_information_technology_joey_dabell.pdf

DECC (2012). Energy Security Strategy Department of Energy and Climate Change. Available from: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/65643/7101-energy-security-strategy.pdf

DECC (2012). Energy Security Strategy. Department of Energy and Climate Change. Available from: http://www.decc.gov.uk/assets/decc/11/meeting-energy-demand/energy-security/7101-energy-security-strategy.pdf

Department for Communities and Local Government (2013). Improving the energy efficiency of buildings and using planning to protect the environment. Department for Communities and Local Government, UK Government. Available from: https://www.gov.uk/government/policies/improving-the-energy-efficiency-of-buildings-and-using-planning-to-protect-the-environment [Accessed on Feburary 19, 2013]

DESI Power (2012). Decentralised Energy Systems (I) Pvt. Ltd. DESI Power. Available from: http://www.desipower.com/MANTRA/Intro/Intro.htm [Accessed on November 21, 2012]

DOE (2011). DOE Microgrid Workshop Report. DOE Office of Electricity Delivery and Energy Reliability Smart Grid R&D Program. Available from: http://energy.gov/sites/prod/files/Microgrid%20Workshop%20Report%20August%202011.pdf

EC (2011). Smart Houses Interacting with Smart Grids to achieve next-generation energy efficiency and sustainability. European Commission. Available from: http://www.smarthouse-smartgrid.eu/fileadmin/templateSHSG/docs/SHSG_D5.5_PublicReport.pdf

Echelon (2012). Echelon Enables Micro Grids In India and South Africa. Echelon. Available from: http://www.echelon.com/company/news-room/2012/microgrids-india-south-africa.htm [Accessed on November 20, 2012]

EST (2012). Feed-In Tariffs scheme (FITs). Energy Saving Trust. Available from: http://www.energysavingtrust.org.uk/Generating-energy/Getting-money-back/Feed-In-Tariffs-scheme-FITs. [Accessed on 28, 2012]

FBO (2012). India - Rural Micro-Grid Solar Power Project. Federal Business Opportunities. Available from: https://www.fbo.gov/index?s=opportunity&mode=form&id=c1f26b69075b2e887dbe9a55ef4786a7&tab=core&_cview=0 [Accessed on November 20, 2012]

Hatziargyriou et al (2007). Microgrids: An Overview of Ongoing Research, Development, and Demonstration Projects. Ernest Orlando Lawrence Berkeley National Laboratory. Available from: http://emp.lbl.gov/sites/all/files/JOURNAL%20lbnl%20-%2062937.pdf

HPS (2012). Husk Power Systems. Husk Power Systems Available from http://www.huskpowersystems.com/presentation.php?pageT=Media - Presentation&page_id=82 [Accessed on November 13, 2012]

ISF (2011). THINK SMALL The Australian Decentralised Energy Roadmap Institute for a Sustainable Future. Available from: http://igrid.net.au/sites/igrid.net.au/files/images/Australian%20%20Decentralised%20Energy%20Roadmap_December%202011_0.pdf

Page 16: Microgrid in Smart Grid · Microgrid in Smart Grid Market Size, Key Issues, Regulations and Outlook to 2020 GDSG0027MAR / Published March 2013

Microgrid in Smart Grid - Market Size, Key Issues, Regulations and Outlook to 2020

GDSG0027MAR / Published MAR 2013 Page 72

© GlobalData. This report is a licensed product and is not to be copied, reproduced, shared or resold in any form

Jungjohann. A and Rickerson. W (2011). No Nukes, No Problem? Germany's Race for a Renewable Future. Renewable Energy World Available from: http://webcache.googleusercontent.com/search?q=cache:Wfz1elRRp1AJ:www.renewableenergyworld.com/rea/news/article/2011/05/no-nukes-no-problem-germanys-race-for-a-renewable-future+Germany+2000+to+2010+renewable+electricity+5%25+to+17%25&cd=2&hl=en&ct=clnk&gl=in [Accessed on December 3, 2012]

Kirchner. H (2011). Peer Energy Cloud: “When Washing Machines Talk To Power Stations”. Metering International. Issue 2. Available from: http://www.seeburger.com/fileadmin/com/pdf/Press_Clips_2011/Last_world_v2_pg87.pdf

Kroposki. B and Vartanian. C (2011). DOE Microgrid Planning Meeting - Microgrid Standards and Protocols. National Renewable Energy Laboratory. Available from: http://e2rg.com/microgrid/standards_breakout2.pdf [Accessed on December 10, 2012]

Lammers. H, (2012). Microgrids: So Much More than Backup Energy. National Renewable Energy Laboratory. Available from: http://www.nrel.gov/news/features/feature_detail.cfm/feature_id=1980 [Accessed on November 10, 2012]

Lighter. E (2008). Smart Grid and DER Integration Activities Supported by the US Department of Energy. 3rd International Conference on Integration of Renewable and Distributed Energy Resources. Available from: http://www.conference-on-integration.com/pres/54_Lightner.pdf

Liu. H. M, (2011). The Development of Microgrid in China. Hohai University. Available from: http://www.ieee-isgt-2011.eu/wordpress/wp-content/uploads/2011/12/Microgrids-in-China_hmliu-ISGT-Panel-1c.pdf [Accessed on December 3, 2012]

Marnay et.all (2012). International Microgrid Assessment: Governance, INcentives, and Experience (IMAGINE). Ernest Orlando Lawrence Berkeley National Laboratory. Available from: http://eaei.lbl.gov/sites/all/files/LBL_5914E_IMAGINE_microgrids.June_.2012_1.pdf

MGP (2012). Mera Gao Power extends its network to Five Villages. Mera Gao Power. Available from: http://meragaopower.com/news/ [Accessed on November 13, 2012]

MNRE (2011). Jawaharlal Nehru National Solar Mission (Scheme on Off-grid and Decentralized Solar Applications). Ministry of New and Renewable Energy. Available from: http://mnre.gov.in/file-manager/UserFiles/jnnsm_formats_st.pdf

Morris et.all (2011). A Framework for the Evaluation of the Cost and Benefits of Microgrids. Ernest Orlando Lawrence Berkeley National Laboratory. Available from: http://eetd.lbl.gov/ea/ems/reports/lbnl-5025e.pdf

NRCC (2012). ARCHIVED - Fuel cells bring clean power to remote B.C. community. National Research Council Canada. Available from: http://www.nrc-cnrc.gc.ca/eng/dimensions/issue4/bella_coola.html [Accessed on December 2, 2012]

Overbeeke.F.V et all (2010). Field Tests on Actual Microgrids. Microgrids.eu. Available from: http://www.microgrids.eu/documents/S._Cobben_Bronsbergen_Holiday_Park.pdf

Papafragkou et all, 2011.The Impact of the GB Feed-in-Tariff and Renewable Heat Incentive to the Economies of Various Microgeneration Technologies at the Street Level. University of Southampton. Available from: http://eprints.soton.ac.uk/336280/1/ecp57vol10_043.pdf

Cohen. D - Tanugi (2010). Putting it into Perspective: China’s Carbon Intensity Target. Natural Resources Defense Council, White Paper.

US DOE (2012). Smart Grid Research & Development Multi-Year Program Plan (MYPP). U.S. Department of Energy Office of Electricity Delivery & Energy Reliability. Available from: http://energy.gov/sites/prod/files/SG_MYPP_2012%20Update.pdf

Wong. S (2011). Microgrid Research Activities in Canada. Natural Resource Canada. Available from: http://der.lbl.gov/sites/der.lbl.gov/files/jeju_wong.pdf

Wrinch. M (2010). Smart Micro Grid Project Update: Hartley Bay, BC, Canada. 2010 Internatonal Symposium on Microgrids. Available from: http://der.lbl.gov/sites/der.lbl.gov/files/vancouver_wrinch.pdf

Page 17: Microgrid in Smart Grid · Microgrid in Smart Grid Market Size, Key Issues, Regulations and Outlook to 2020 GDSG0027MAR / Published March 2013

Microgrid in Smart Grid - Market Size, Key Issues, Regulations and Outlook to 2020

GDSG0027MAR / Published MAR 2013 Page 73

© GlobalData. This report is a licensed product and is not to be copied, reproduced, shared or resold in any form

11.4 Methodology GlobalData’s dedicated research and analysis teams consist of experienced professionals with a pedigree in marketing and market research, consulting backgrounds in the energy industry, and advanced levels of statistical expertise.

GlobalData adheres to the codes of practice of the Market Research Society (www.mrs.org.uk) and the Strategic and Competitive Intelligence Professionals (www.scip.org) .

All GlobalData’s databases are continuously updated and revised. The following methodology has been followed for the collection and analysis of data presented in this report.

11.4.1 Coverage This report gives detailed information on the global microgrid market and markets for Asia-Pacific, Europe, North America and the rest of the world. The report also provides in-depth coverage of the markets for the US, Canada, Germany, the UK, China and India. The report provides:

Analysis on the microgrid market, including key technologies such as distributed generation systems, energy storage systems, power electronics and microgrid energy management systems and software

Data on the market value for microgrid deployment, globally for the above mentioned regions and the six countries

Brief descriptions of the key microgrid market players

Power regulations and key projects affecting the microgrid market

11.4.2 Secondary Research The research process begins with exhaustive secondary research within GlobalData's own databases and external sources.

Market values and volumes, pricing estimates and market growth rates are arrived at by taking the following into consideration:

Statistics and historic trends provided by government bodies, industry associations and equipment vendors

Utility expansion plans

Government and private sector investments

Government regulations and policies

GlobalData’s proprietary databases like the Capacity and Generation Database.

Other insights built through secondary research and analysis of company websites, annual reports, investor presentations, industry and trade journals, and association data.

11.4.3 Primary Research A number of primary interviews are conducted with personnel across the value chain to verify and fine-tune the market numbers obtained from secondary research and get first-hand information on industry trends.

Participants are drawn from a diverse set of backgrounds including equipment manufacturers, industry associations, government bodies, and utilities. Participants include, but are not limited to, business development and sales managers, C-level executives, industry consultants and purchasing managers.

Page 18: Microgrid in Smart Grid · Microgrid in Smart Grid Market Size, Key Issues, Regulations and Outlook to 2020 GDSG0027MAR / Published March 2013

Microgrid in Smart Grid - Market Size, Key Issues, Regulations and Outlook to 2020

GDSG0027MAR / Published MAR 2013 Page 74

© GlobalData. This report is a licensed product and is not to be copied, reproduced, shared or resold in any form

11.4.4 Definitions, Market Estimates and Assumptions

The average market size for microgrid has been calculated based on secondary and primary research. Various policies and legislation and projects have been used to arrive at the total market revenues and share of the various regions.

It has been assumed that the overall cost of the energy storage technology will reduce during the forecast period, due to increased R&D effort and higher deployment of the technology around the world.

Various qualitative and quantitative insights have been considered for estimating the market size. The forecast data and model has been validated through various industry experts.

11.6 Disclaimer All Rights Reserved.

No part of this publication may be reproduced, stored in a retrieval system or transmitted in any form by any means, electronic, mechanical, photocopying, recording or otherwise, without the prior permission of the publisher, GlobalData.

This report is a licensed product and should not to be reproduced without prior permission.