Wood Mackenzie estimates that the US microgrid market is set to see a 47% increase in solar and storage capacity in 2022 compared to 2017 levels.
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The US microgrid market is set to reach 10 GW in the third quarter of 2022, with more than 7 GW in operation and the rest in the planning or construction stages, according to the latest analysis by Wood Mackenzie’s Grid Edge Service.
Microgrids are clusters of distributed energy resources, such as solar modules on a home, connected to a battery system, that can be disconnected from the grid and operated independently during power outages.
“Despite the global Covid-19 pandemic and related macroeconomic challenges, which has caused a two-year recession in the United States, the microgrid market continues to grow at a rapid pace and 2022 is on track to be a record year in installed installations and pipelines Yes, says Elham Akhavan, principal research analyst at Wood Mackenzie.
Akhavan said microgrids are being set up across various customer segments, with commercial and industrial leading the way. Microgrids are being adopted in sectors such as department stores and manufacturing, “indicating a growing demand for uninterrupted service,” he said, adding that the government sector comes in second, followed by residential sectors and educational sectors.
Military microgrid installations are likely to increase as a result of the US military’s goal of installing a microgrid at every facility by 2035. across all Army establishments by 2040.
According to Wood Mackenzie data, the US microgrid market sees a 47% increase in solar and storage capacity in 2022 compared to 2017 levels. Additionally, data shows that more than 175 solar and microgrid projects with solar plus storage are in active development and were scheduled to come online in late 2022.
“There has been a significant shift in the type of technology being deployed, particularly an increase in demand for solar and storage among microgrid customers, driven by corporate ESG goals,” Akhavan said. He noted a rise in “multi-distributed energy resource (DER) microgrids”, which can include a fossil fuel generator that serves as a standby power generator in cases where solar power and batteries alone can handle long-term outages. Can’t reduce it.
The microgrid-as-a-service (MaaS) business model is expected to see continued growth in many non-utility customer segments, and according to Wood Mackenzie data, the share of MaaS deals grew 25% between 2019 and Q3 2022, while the last The percentage of microgrids owned by users fell 31% between 2019 and Q3 2022.
“While third-party financing is not a new model in general, MaaS is evolving beyond PPA contracts, which often involve the acquisition of a single DER, to an economical way to finance the construction, operation and maintenance of multiple DERs. The solution is tailored to the customer’s energy goals,” Akhavan said.
Data from Wood Mackenzie shows that there are 28 states with utility microgrids, with about 35 MW of projects expected to come online by 2022. This brings the total microgrid capacity to over 1.1 GW.
“While utility companies typically seek fee-based microgrids, some are partnering with developers to offer microgrids to their customers under MAS agreements,” Akhavan said. For example, Enchanted Rock announced a utility partnership program in early 2022 that enables utilities to provide “resilience” as an “end-to-end” service to their customers. Enchanted Rock deploys commercial-scale microgrids that use natural gas and renewable natural gas (RNG) to reduce carbon emissions and pollutants found in traditional diesel generators.
Akhavan estimates that if the market continues on its current path, we will see annual microgrid capacity installations increase by more than 20%. This field has experienced growth in the Northeast, where several competitive grant programs support resilience projects for critical facilities.
“The West Coast, led by California, is growing tremendously with a strong pipeline of projects coming online in 2024. It is closely followed by the South West market, which has expanded more than three times since 2019. Texas is the leader, with two major developers in the region, PowerSecure and Enchanted Rock, having installed full capacity so far in 2022,” Akhavan said.
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