The problem with centralized power grids is that they can be crippled at just one point of failure, leaving consumers vulnerable to outages. According to Mark Feasel of Schneider Electric, the cost of such outages for the U.S economy overall is $150 billion a year. An irritating inconvenience for domestic consumers, prolonged outages are expensive, damaging and potentially fatal to businesses of all scales. Insurance may not necessarily cover business that are forced to close due to power outages, just as it may not reimburse damage to property or stock. Given that the question of outages is likely to be when rather than if, it is no surprise that many businesses are looking to augment their power needs with backup systems. While for some that may simply be something like a backup generator, many more are utilising microgrids.
Put simply, a microgrid contains localised energy generation, distribution and in some cases, storage. Microgrids are generally used in discrete locations to provide all of the power needs of that site, but they also work in tandem with a centralized grid, augmenting or providing backup power to that supply.
The main benefits of microgrids are threefold; they are local, independent and intelligent. When energy is produced locally, the grid itself becomes more efficient. Delivering electricity form centralized grids leads to losses of between 8 and 15 percent. This locality also means that the site isn’t susceptible to power outages that affect the central grid. In such an event, the microgrid can take control of the delivery of power before there is any loss, eliminating blackouts and brownouts. The way it does this is by use of intelligent switching. A microgrid can monitor all aspects of the power system, and thereby intelligently switch between the local grid and the wider grid, depending on various factors. It can, for example, monitor price fluctuations and only draw from the main grid when prices are low, switching to local supply when they rise.
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