BEYOND THE BUZZWORDS: MAKING THE SPECIFIC CASE FOR COMMUNITY RESILIENCE MICROGRIDS

Transcription

1 BEYOND THE BUZZWORDS: MAKING THE SPECIFIC CASE FOR COMMUNITY RESILIENCE MICROGRIDS PANEL 11: RESILIENT, SUSTAINABLE COMMUNITIES 2016 ACEEE SUMMER STUDY AUGUST 24, 2016 DEREK JONES ASSOCIATE DIRECTOR NAVIGANT 1

2 TABLE OF CONTENTS SECTION 1: SECTION 2: SECTION 3: SECTION 4: SECTION 5: SECTION 6: OVERVIEW MICROGRID CLASSIFICATION FRAMEWORK MARKET TRENDS CASE STUDY COMPARISON KEY FINDINGS ROADMAP CONSIDERATIONS 2

3 MEET THE AUTHORS DEREK JONES, ASSOCIATE DIRECTOR Microgrid and distributed energy resources (DER) planning, strategy, evaluation, and policy analysis JONATHAN STRAHL, MANAGING CONSULTANT Microgrid and DER cost-benefit evaluation and modeling (Grid+) and has interviewed over 30 microgrid companies and professionals MICHELLE BEBRIN, MANAGING CONSULTANT Microgrid and DER business strategy and investment evaluation EMILY PARIS, SENIOR CONSULTANT Microgrid and DER research in emerging international markets 3

4 OVERVIEW 4

5 MICROGRID LANDSCAPE EVOLVING TREND Proliferation of DER has driven stakeholder interest in islanding capability, though currently taking wait-and-see investment approach PRIMARY PAPER FINDINGS Microgrids are complex and lack a widely accepted definition North American microgrid market is small, rapidly growing, and highly fragmented Microgrid business models are not well-established, resulting in significant financial risk and opportunity AUTHORS VISION Stakeholders consider paper s proposals in microgrid decision-making 5

6 MICROGRID CLASSIFICATION FRAMEWORK 6

7 MICROGRID DEFINITION: MOST COMMON MOST COMMON (US DEPARTMENT OF ENERGY MICROGRID EXCHANGE GROUP) 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. 7

8 MICROGRID CLASSIFICATION FRAMEWORK SEGMENTATION CRITERIA Grid connection Navigant s Microgrid Classification Framework Scale End users Objective Load served (Source: Navigant) 8

9 MICROGRID CLASSIFICATION FRAMEWORK Segment 1. Remote Microgrids 2. Nanogrids 3. Campus and Commercial Microgrids Campus/Institutional Campus/Industrial Military Navigant s Microgrid Classifications Description Permanently islanded systems with distributed generation serving local load Small microgrids (<100 kw) serving single residential or commercial buildings Serve either multiple buildings or large single buildings (>100 kw) Serve end users such as universities and hospitals Serve a private companies facilities Support mission-critical loads 4. Utility and Community Microgrids Serve multiple end users Community Resilience Microgrids Provide critical community services during prolonged outages Utility Distribution Microgrids Serve portion of distribution system above the transformer level Community Commercial/Industrial Serve collection of residential end users Serve multiple commercial/industrial customers (Source: Navigant) 9

10 COMMUNITY RESILIENCE MICROGRID DEFINITION COMMUNITY RESILIENCE MICROGRID (NAVIGANT) A community resilience microgrid is designed to serve multiple customers located within a community a neighborhood, district, or local government jurisdiction and its prime purpose is to provide emergency power during periods of utility power grid outages. While potentially serving the needs of both public and private entities, these microgrids must be connected to a utility distribution network and be capable of some level of safe islanding and are dedicated primarily to public purposes such as emergency shelters, critical infrastructure, or vital community services (Asmus and Lawrence 2015). 10

11 11 MARKET TRENDS

12 COMMUNITY RESILIENCE MICROGRID FORECAST The growing interest in Community Resilience Microgrids is reflected in an 8.8% compound annual growth rate (CAGR) for North America through Community Resilience Microgrid Forecast, World Markets: (Source: Navigant Research) 12 12

13 COMMUNITY RESILIENCE MICROGRID TRENDS LOCAL ELECTRIC SERVICE RELIABILITY Critical community services during prolonged outages OUTAGE DURATION TRENDING UPWARD Proliferation of DER has driven stakeholder interest in islanding capability, though currently taking wait-and-see investment approach WEATHER IMPACTS THREATEN INFRASTRUCTURE Electric grid damages between $177 billion and $335 billion between 2003 and 2012 (US DOE 2013) STATE AND STANDARDS SUPPORT State programs: CA, CT, MD, MA, MN, NJ, and NY Specification standards: IEEE P and IEEE P

14 MICROGRID ECOSYSTEM MODEL Model is the basis for analysis of technical, commercial, and financial aspects of microgrid costs and benefits to stakeholders in the ecosystem Commercial Ecosystem Model (Source: Navigant) 14

15 EVALUATING NANOGRIDS AS DER BOSCH DIRECT CURRENT BUILDING-SCALE MICROGRID PLATFORM (DCBMP) Site: Honda Motors Parts Distribution Center, Chino, CA System: Navigant evaluating the business case - DC system: 300 kw solar PV kw storage DC LED lamps - Small PV system and fewer AC inverters reduces LCOE 20-25% - Reduce grid impacts by 80% due to (1) DC load use of PV and (2) Load arbitrage between storage, DC loads, and DC bus Market forecast: 9 GW in CA investor-owned utility (IOU) service territories through DCBMP Cumulative Forecast (GW) (Source: Bosch) (Source: Navigant) 15

16 CASE STUDY COMPARISON 16

17 CASE STUDY COMPARISON: TECHNICAL TECHNICAL COMPARISON What are the key technical considerations for the interconnection? Princeton Borrego Springs Co-op City Oncor SOSF 17 Technical Insights Design the microgrid s distribution system with operational foresight. Project has underground distribution with two utility lines serving each substation. PV and combined heat and power (CHP) intentionally connected to different substations, preventing PV from influencing CHP dispatch. Microgrids can be used to facilitate grid integration of DER. Intentionally sought to reduce feeder peak load by incorporating customer- and utilityowned distributed generation (DG), demand response (DR), and distribution automation (DA) under one utility-managed control scheme. Microgrids act as laboratory for piloting smart grid technologies. Co-op City has sufficient scale, independence, self-governance, and community motivation to become an urban laboratory for integrated smart grid technology into affordable housing initiatives. Integration of advanced microgrid controls and existing grid devices will create challenges. While built from the ground up, Oncor realizes that integrating legacy equipment with advanced control technologies will pose great technical challenges.

18 CASE STUDY COMPARISON: ISLANDING ISLANDING COMPARISON What challenges exist in ensuring reliability and resiliency during an outage? Princeton Borrego Springs Oncor SOSF Islanding Insights Consider disconnecting intermittent DER during island mode. During Sandy, Princeton intentionally tripped their solar PV farm to prevent it from risking the operation of the CHP plant. Identify and prioritize critical loads load shedding is often essential for islanding. Focus on DR and shedding non-critical critical loads decreased project costs, improved resilience, and allowed SDG&E to serve more customers for longer duration during islanding. Islanding should be tested under multiple realistic conditions. Safety features would lock the control system if operation sequences were out of order; faced failed diesel generator startups due to emission setting requirements and energy storage startups due offbeat signals. 18

19 KEY FINDINGS 19

20 KEY FINDINGS MICROGRIDS ARE COMPLEX, LACK WIDELY ACCEPTED DEFINITION To address this issue, Navigant developed a set of definitions and frameworks, such as the Ecosystem Model, that market players can use to establish a common language and begin to understand this multifaceted DER NA MICROGRID MARKET SMALL, GROWING, AND FRAGMENTED Imperative for Community Resilience segment stakeholders to learn from prior projects to replicate and scale designs and business models MICROGRID BUSINESS MODELS NOT WELL-ESTABLISHED Lack of clear, identifiable business models that will be profitable First movers to find winning models create a competitive advantage 20

21 ROADMAP CONSIDERATIONS 21

22 ROADMAP CONSIDERATIONS Two future state scenarios for stakeholders to consider and evaluate while plotting their path forward through microgrid planning, financing, construction, and operations: 1. DIRECT COMMUNITY RESILIENCE MICROGRID MARKET EXPANSION Market would build upon past successes, developing slowly at first and then accelerating as the market becomes more adept at addressing the needs of each of these segments 2. NANOGRIDS AS A STEPPING STONE Nanogrids could serve as an interim technology as the market becomes more familiar with the complexities and best applications for Community Resilience microgrids 22

23 ROADMAP CONSIDERATIONS It is still too early to assign any level of certainty to whether the market will grow through Scenario 1 or 2 or any other for microgrids These circumstances make this paper all the more timely: Stakeholders mulling a proactive or wait-and-see strategic approach to this industry stand to greatly benefit from past microgrid lessons, market forecasts, strategy and business model development tools, and implementation lessons discussed in this paper. 23

24 THANK YOU DEREK JONES Associate Director JON STRAHL Managing Consultant MICHELLE BEBRIN Managing Consultant navigant.com