Microgrids – What Are They and How Do They Work?

More and more people are becoming concerned with the resiliency and reliance of power. When there is an outage, planned or unplanned, and the grid goes dark; what can we do? The solution to this problem is microgrids, in partnership with renewable energy such as solar energy.

What is a Microgrid?

A microgrid is a local energy grid with control capability, which means it can disconnect from the traditional grid and operate autonomously.1 According to the U.S. Department of Energy Microgrid Exchange Group, the following criteria defines a microgrid:

A microgrid is 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. A microgrid can connect and disconnect from the grid to enable it to operate in both grid-connected or island-mode.2

To meet the electricity demands of its users, a microgrid must have a generation source. Given that microgrids are an older concept, the electricity supplied to microgrids has historically been from “behind the meter” fossil fuel generators – gas-powered generators, for example. However, with the falling cost of solar, not to mention the environmental benefits of switching from fossil fuel generation to solar power, many of the microgrids being designed today supply electricity with a combination of solar plus battery storage.3

Advantages of Microgrids

There are more than several benefits of microgrids:4

  • Provide efficient, low-cost, clean energy
  • Improve the operation and stability of the regional electric grid
  • Critical infrastructure that increases reliability and resilience
  • Reduce grid congestion and peak loads
  • Enable highly-efficient CHP, reducing fuel use, line losses, and carbon footprint
  • Integrate CHP, renewables, thermal and electric storage, and advanced system and building controls
  • Make RTO markets more competitive
  • Offer grid services including: energy, capacity, and ancillary services
  • Support places of refuge in regional crises and first responders
  • Use local energy resources and jobs
  • Diversified risk rather than concentrated risk
  • Using electric and thermal storage capabilities, a microgrid can provide local management of variable renewable generation, particularly on-site solar
  • When properly designed, a regional power grid that combines both large central plants and distributed microgrids can be built with less total capital cost, less installed generation, higher capacity factor on all assets, and higher reliability.

How Microgrids are Being Utilized

The grid connects homes, businesses and other buildings to central power sources, which allow us to use appliances, heating/cooling systems and electronics. But this interconnectedness means that when part of the grid needs to be repaired, everyone is affected.

This is where a microgrid can help. A microgrid generally operates while connected to the grid, but importantly, it can break off and operate on its own using local energy generation in times of crisis like storms or power outages, or for other reasons.

A microgrid can be powered by distributed generators, batteries, and/or renewable resources like solar panels. Depending on how it’s fueled and how its requirements are managed, a microgrid might run indefinitely.

A microgrid not only provides backup for the grid in case of emergencies, but can also be used to cut costs, or connect to a local resource that is too small or unreliable for traditional grid use. A microgrid allows communities to be more energy independent and, in some cases, more environmentally friendly.1

Microgrids are capable of becoming electrically isolated from the grid in the event of an outage. When the grid goes down due to anything from a severe weather event to a knocked over telephone pole, you need to be disconnected from the grid–or “islanded”–in order to continue to produce and use electricity. As such, one key feature of a microgrid is its ability to continue operating even when the larger grid goes out.3

In cases such as the fires raging in California recently, microgrids would prove to be beneficial. Many of the power outages in California are planned outages, so that powerlines are not knocked down and sparking more fires. For many people, a microgrid would be a solution to their power problem by being able to produce their own power via solar panels and storing this energy for use in emergencies. These households could disconnect from the main grid and be self-sufficient until the main grid is back online.

Who to Contact

If you have an energy storage or alternative energy project you are looking to pair with a microgrid, give us a click on the Contact Us button at the top of this page.


1Department of Energy. (June 17, 2014). How Microgrids Work. Retrieved from energy.gov: https://energy.gov/articles/how-microgrids-work

2Berkeley Lab. (2019). About Microgrids. Retrieved from building-microgrid.lbl.gov: https://building-microgrid.lbl.gov/about-microgrids

3Fields, Spencer. (January 17, 2019). What are microgrids and how do they work? Retrieved from news.energysage.com: https://news.energysage.com/what-are-microgrids/

4Microgrid Resources Coalition. (2019). Microgrid Features. Retrieved from districtenergy.org: https://www.districtenergy.org/microgrids/about-microgrids97/features


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