Urban Microgrids: overview, challenges and opportunities

Urban Microgrids, a promising potential for a modernized electric infrastructure?

ENEA Consulting published the results of a study on urban microgrids conducted in partnership with the Group ADP, the Group Caisse des Dépôts, ENEDIS, Omexom, Total and the Tuck Fundation. This study offers a vision of the definition of an urban microgrid, the value brought by a microgrid in different contexts based on real case studies, and the upcoming challenges that microgrid stakeholders will face (regulation, business models, technology).

The electric production and distribution system, as the backbone of an increasingly urbanized and energy dependent society, is urged to shift towards a more resilient, efficient and environment-friendly infrastructure. Decentralisation of electricity production into densely populated areas is a promising opportunity to achieve this transition.

A microgrid enhances local production through clustering electricity producers and consumers within a delimited electricity network; it has the ability to disconnect from the main grid for a limited period of time, offering an energy security service to its customers during grid outages for example. However:

  • The islanding capability is an inherent feature of the microgrid concept that leads to a significant premium on electricity cost, especially in a system highly reliant on intermittent electricity production. In this case, a smart grid, with local energy production and no islanding capability, can be customized to meet relevant sustainability and cost savings goals at lower costs
  • For industrials, urban Microgrids can be economically profitable in presence of high share of reliable energy production and thermal energy demand
  • Microgrids face strong regulatory challenges that should be overcome for further development

Whether islanding is or is not implemented into the system, end-user demand for a greener, more local, cheaper and more reliable energy, as well as additional services to the grid, are strong drivers for local production and consumption. In some specific cases, relevant business models can turn into viable commercial projects provided that the constraints enforced by regional regulatory frameworks are adapted.

Written by

Safae El Fadili

Safae El Fadili