Mighty

 Microgrids    
Communi'es  all  over  the  country  are  finding  ways  to  break  the  macro  barriers  to  
microgrids.  As  we  flip  from  a  top-­‐down  to  bo?om-­‐up  grid  management  structure,  
major  policy  barriers  must  be  liBed  in  order  to  expand  energy  democracy  to  
customers  and  producers.  
 
Ma$  Grimley  and  John  Farrell  
March  2016  
Executive  Summary  
The electric grid is no longer a 20th-century, one-way system. A constellation of
distributed energy technologies is paving the way for “microgrids,” a combination of
smart electric devices, power generation, and storage resources, connected to one or
many loads, that can connect and disconnect from the grid at-will.

Microgrids:
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 and that connects and disconnects from such grid to
enable it to operate in both grid-connected or island mode.

Expanding  Uses  
For years, microgrids were most common at hospitals and military bases — places that
require more reliability than the aging grid offers. Today, microgrids are increasingly
used for more:
• To integrate very high portions of renewable energy, such as Kodiak Island (Alaska)
or Stafford Hill (Vermont).
• To manage energy costs or “arbitrage” to buy energy from the grid at low prices and
self-generate when prices are high, such as the University of California San Diego.
• To provide resilient and safe public spaces during times of natural disaster, including
many new microgrids planned in the wake of Hurricane Sandy.

Opportunity  to  Grow  

The economic case for microgrids grows as the cost of distributed generation and
energy storage continue to fall. Some companies already offer turnkey “nanogrids” that
serve a single building. Larger, community microgrids are also being built, testing out
the technology, and the business and legal models.

A few states such as New York and California are changing the rules and offering
funding to accelerate development of microgrids.

Why  Microgrids  Face  Macro-­‐Problems  

Unfortunately, policy and political pressures may inhibit growth of nanogrids and larger
microgrids. Nanogrids face many of the same barriers as distributed solar, including
utility attempts to reduce the financial benefits, shifts to fixed charges, or slashing net
metering compensation.

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Microgrids, particularly those that connect multiple buildings (and cross public rights-of-
way like streets) face larger problems. Five particularly large barriers loom large:

1. Microgrids are undefined in most state laws,

leaving legal uncertainty about whether they
will be classified and regulated as utilities.
2. Microgrids may run afoul of state laws
prohibiting sales of electricity by non-utility
entities.
3. Microgrids may have particularly challenging
interconnection issues that are not addressed
by single generator interconnection rules.
4. Microgrid controllers, the “central brain,” have
typically been individualized, inhibiting easy
replication and increasing cost.
5. Microgrids may have few revenue streams if
there aren’t markets for services such as
voltage control and frequency regulation.
Additionally, depending on microgrid ownership
(the utility, a public entity, a private company),
it’s unclear how the benefits should be shared.

Microgrids are just one more way that the grid is becoming democratized and
miniaturized. To some extent they are unstoppable, the continuation of economic and
technology trends favoring local, decentralized power generation.

But microgrids are also a unique challenge, a “back to the future” moment that runs
afoul of decades of policy centralizing ownership and control of the electricity system.
State policies are at best ambiguous and at worst hostile toward microgrid development.
Whether microgrids will be mighty depends on whether the rules will change in time to
allow it.

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Acknowledgements

Thanks  to  David  Morris,  Peter  Asmus,  and  the  Microgrid  Resources  Coali'on  for  their  thoughIul  
review  and  help.  Thanks  to  Rebecca  Toews  and  Nick  Stumo-­‐Langer  for  making  sure  more  than  5  
people  read  it.  All  errors  are  our  own  responsibility.  

Ma?  (mgrimley@ilsr.org)  and  John  ( jfarrell@ilsr.org)


Recent  ILSR  Publications  

Independent  Business  Report  
By  Stacy  Mitchell  and  Olivia  LaVecchia,  
February  2016  

SandyNet  Goes  Gig:  A  Model  for  Anytown  USA  

By  Chris  Mitchell,  November  2015  

Building  Local  Equity:  ILSR's  Impact  in  2015  

By  Jen  Foy  and  Stacy  Mitchell,    
November  2015  

Hawai'i  at  the  Energy  Crossroads    

By  Ma$  Grimley  and  John  Farrell,  July  2015   Since  1974,  the  InsNtute  for  Local  Self-­‐  
Reliance  (ILSR)  has  worked  with  ciNzen  
Comcast’s  Big  Gig  Rip-­‐Off   groups,  governments  and  private  
By  Hannah  Trostle  and  Chris  Mitchell,     businesses  to  extract  the  maximum  value  
July  2015   from  local  resources.  

Public  RooOop  RevoluQon     InsQtute  for  Local  Self-­‐Reliance  

By  John  Farrell  and  Ma$  Grimley,   Minneapolis  -­‐  Portland  -­‐  Washington,  DC  
June  2015   www.ilsr.org  

Beyond  UQlity  2.0  to  Energy  Democracy   This  work  is  licensed  under  a  CreaNve  
By  John  Farrell,  December  2014   Commons  A$ribuNon-­‐NonCommercial-­‐
ShareAlike  4.0  InternaNonal  License  by  the  
Walmart’s  Dirty  Energy  Secret   InsNtute  for  Local  Self-­‐Reliance.  Permission  is  
By  Stacy  Mitchell  and  Walter  Wuthmann,   granted  under  a  CreaNve  Commons  license  to  
November  2014   replicate  and  distribute  this  report  freely  for  
noncommercial  purposes.    
CorrecQng  Community  Fiber  Fallacies  
By  Christopher  Mitchell,  October  2014  

Walton  Family  Undermining  RooOop  Solar  

By  Stacy  Mitchell,  October  2014    
Cover  photo:  Stafford  Hill  Solar  Farm,    
credit:  Eric  Hudiburg:  Solarelectricpower.org


Page 3 of 37 Institute for Local Self-Reliance

Table of Contents
Executive  Summary   1  
Expanding Uses
Opportunity to Grow
Why Microgrids Face Macro-Problems
Table  of  Contents   4  
Introduction   5  
DeKinition  and  Context   6  
Where  They  Are  Today   7  
Why  Microgrids?   8  
Mighty  Microgrids   10  
Spreading Community Microgrids for Resilience in New England
Microgrids Serving Single Users and Campuses
Utilities  Test  the  Waters   15  
Oncor, Oncor!
Borrego Springs: An Evolving Look at Community
Stafford Hill: Nothing But Solar
Islands and Remote Locales with High Renewable Energy
Wheels to the Road in San Diego an Electrified Economy
Growing Grassroots Microgrids in California
Why  the  Microgrid  Market  Will  Explode   23  
Why  Microgrids  Face  Macro-­‐Problems   25  
The  (Easy  or  Hard)  Way  Forward   29  
References   32

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Introduction
The  electric  grid  pulses  with  the  power  from  thousands  of  large  power  plants,  pushing  electrons  
in  every  direcNon.  It’s  considered  one  of  the  greatest  engineering  achievements  of  the  20th  
century.  Every  year  in  the  United  States,  homeowners  and  businesses  spend  more  than  $360  
billion  on  electricity.1  That’s  more  than  two  percent  of  the  naNonal  gross  domesNc  product,  
flowing  out  of  towns  and  ciNes  to  reimburse  owners  of  huge  power  plants,  far-­‐stretching  power  
lines,  and  a  century-­‐old  style  of  energy  producNon.2    

The  very  scale  of  the  electricity  system  introduces  inefficiencies.  Most  power  plants  waste  two-­‐
thirds  of  their  fuel’s  energy  as  heat.3  Transmission  and  distribuNon  power  lines  lose  another  two  
to  13  percent  of  the  energy.  Meanwhile,  monthly  outages  have  increased  six-­‐fold  over  the  past  
decade.4  According  to  a  Lawrence  Berkeley  NaNonal  Laboratory  study,  “increased  [transmission  
and  distribuNon  spending  on  the  grid]  in  the  previous  year  was  not  correlated…  with  
improvements  in  reliability  in  the  following  year.” 5    According  to  the  same  study,  extreme  
weather  condiNons  –  most  likely  exacerbated  by  climate  change  and  carbon  polluNon  –  are  
correlated  with  an  increase  in  outages.    

The  electric  grid  is  no  longer  a  20th  century,  one-­‐way  system.  Customers  can  increasingly  make  
choices  to  have  greater  control  over  reliability,  resiliency,  and  more  renewable  energy.  
Encouraged  by  rapidly  decreasing  costs,  people  have  put  solar  on  their  homes,  sending  energy  
back  to  the  grid.  Smart  devices  such  as  ba$eries  and  thermostats  can  work  with  the  uNlity  to  
absorb  or  lower  energy  use.  Electric  car  ba$eries  can  store  plenNful  solar  and  wind  energy.  With  
larger  buildings  or  campuses,  combined  heat  and  power  systems  transform  inefficient  power  
only  systems  into  highly  efficient  heaNng  and  power  resources.    

This  constellaNon  of  distributed  energy  technologies  is  now  enabling  the  microgrid,  one  of  many  
new  local  soluNons  to  generaNng  energy.  Ironically  enough,  the  industry  is  going  back  to  the  
future,  back  to  the  Nme  of  the  fledgling  electric  uNlity  companies  that  emerged  aier  Thomas  
Edison  opened  his  small  Pearl  Street,  New  York  City  power  staNon  in  1882.  Edison  envisioned  
that  the  electric  uNlity  industry  would  involve  small  firms  generaNng  power  for  individual  
businesses  through  such  networks.  By  1886,  Edison’s  firm  had  installed  58  micro-­‐grids.6  But  
soon,  the  emergence  of  alternaNng  current  enabled  long  distance  transmission  of  electricity,  
which  helped  shii  the  focus  to  the  larger  uNlity  monopolies  that  dominated  power  markets  for  
the  next  century.

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DeKinition  and  Context  
The  microgrid  is  the  latest  in  a  long  line  of  technological  innovaNon  on  the  power  grid.  
According  to  the  U.S.  Department  of  Energy,  a  microgrid  is  “a  group  of  interconnected  loads  and  
distributed  energy  resources  within  clearly  defined  electrical  boundaries  that  acts  as  a  single  
controllable  enNty  with  respect  to  the  grid  and  that  connects  and  disconnects  from  such  grid  to  
enable  it  to  operate  in  both  grid-­‐connected  or  island  mode.”    

In  other  words,  a  microgrid  is  a  number  of  generaNon  and  storage  resources  that  can  connect  
and  disconnect  from  the  grid  at-­‐will.  

Microgrids  today  can  serve  single  buildings.  These  are  nanogrids,  oien  featuring  a  single  backup  
generator,  perhaps  with  energy  storage,  to  support  minimal  building  operaNons  when  the  larger  
grid  goes  down.  These  nanogrids  are  small,  usually  under  100  kilowa$s  (kW).    
 

Chart credit: California Public Utilities Commission

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Campus  microgrids  join  together  several  buildings  owned  by  one  enNty,  such  as  a  college  or  
business.  These  structures  oien  incorporate  combined  heat  and  power  generators  to  supply  
the  majority  of  their  electricity  and  heaNng  needs.  Remote  microgrids,  such  as  those  in  rural  
Alaska  or  on  islands,  do  not  have  the  benefit  of  using  the  larger  grid  for  backup,  and  as  such,  
provide  all  the  energy  they  need.  While  these  remote  systems  do  meet  the  DOE  microgrid  
definiNon,  they  have  been  pioneering  greater  resiliency  through  renewable  energy  well  in  
advance  of  the  lower  48.  It  is  esNmated  between  100  and  200  remote  microgrids  are  fully  
funcNonal  today,  providing  power  in  the  absence  of  tradiNonal  grid  infrastructure. 7    

More  advanced  microgrids,  as  featured  in  the  prior  image,  connect  mulNple  unaffiliated  end-­‐
users  with  mulNple  types  of  generaNon,  storage,  and  smart  devices.  These  can  be  known  as  
community  or  uNlity  distribuNon  microgrids.8  

Where  They  Are  Today  

Microgrids  are  currently  uncommon,  with  1.3  gigawa$s  of  capacity  online  in  2015,  about  0.1%  
of  total  U.S.  installed  electric  generaNng  capacity.9  80  percent  of  operaNonal  microgrids  exist  in  
just  seven  states,  mostly  those  that  acNvely  designed  laws  to  accommodate  their  expansion.  
Some  analysts  predict  their  number  to  double  or  triple  in  the  next  five  to  ten  years.  Many  
regulatory,  financial,  technical  and  cultural  barriers  exist  against  their  easy  deployment.    

ExisNng  microgrids  generally  serve  two  purposes:    

1. To  save  money  where  energy  is  expensive,  such  as  a  remote  locaNon  or  an  area  
with  high  electricity  prices;  or  
2. To  provide  certainty  of  power  supply  at  military,  university,  school,  or  hospital  
(MUSH)  faciliNes  or  commercial  complexes  such  as  data  centers  that  can’t  risk  
losing  power.    

The  vast  majority  of  microgrids  are  campus  systems,  including  military  bases,  serving  a  single  
electric  customer.  A  smaller  fracNon  of  today’s  microgrids  serve  mulNple,  unaffiliated  end-­‐users  
in  a  community  microgrid.  While  emerging  state  programs  specifically  support  this  new  
“community  resilience”  market,  very  few  of  these  systems  are  currently  running.    

Today’s  microgrids  rely  heavily  on  natural  gas  and  diesel  burners  oien  in  the  form  of  a  
combined  heat  and  power  plants  (burning  fossil  fuels)  that  recycle  heat  for  nearby  faciliNes.  
While  renewables  and  storage  will  contribute  heavily  in  the  future,  only  six  percent  of  energy  in  
microgrids  currently  comes  from  renewables,  according  to  GreenTech  Media  Research.10    

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Chart credit: GreenTech Media Research

Why  Microgrids?  
Many  communiNes  today  are  asking  for  a  microgrid.  But  not  everybody  knows  what  it  is,  let  
alone  why  they  should  have  it.  

The  microgrid  is  one  of  many  local  tools  for  ciNes  and  uNliNes  to  build  a  locally-­‐reliant  energy  
system.  Its  potenNal  is  apparent,  serving  several  interests  of  electric  customers  that  uNliNes  may  
not:  

• Unlock  Distributed,  Clean  Energy.  With  the  rapidly  declining  costs  of  solar  energy  and  
storage,11  the  microgrid  presents  a  way  to  spur,  organize,  and  aggregate  distributed  
energy  resources.  Microgrids  can  even  help  pave  the  way  to  100  percent  renewable  
energy.  ExisNng  island  microgrids  in  Hawai’i  and  Kodiak  Island  prove  that  100  percent  
renewable  energy  is  within  reach,  while  solar-­‐and-­‐storage  microgrids  are  spreading  
rapidly  as  a  commercial  service.  

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• Promote  Resilience.  The  ability  to  operate  independently,  or  island,  forNfies  microgrids  
against  greater  grid  outages.  In  the  wake  of  Hurricane  Sandy,  many  Northeastern  states  
and  uNliNes  have  promoted  microgrids  as  a  less-­‐costly  soluNon  than  power  line  and  
generaNon  upgrades,  as  microgrids  stayed  online  during  wider  grid  outages.  They  also  
provide  vital  services  to  the  “macrogrid,”  such  as  lowering  their  energy  use  during  
Nmes  of  high  energy  demand  or  providing  quick  bursts  of  energy  from  ba$eries.  
• Be  Cost-­‐effecQve.  Microgrids  can  operate  more  efficiently  than  the  larger  grid  by  stacking  
energy  services.  Stafford  Hill,  a  microgrid  in  Vermont,  deploys  solar  and  storage  to  
provide  power  to  the  grid,  storage  in  case  of  emergency,  and  grid  services  (such  as  
voltage  regulaNon)  based  on  its  power  producNon,  all  together  producing  a  net  
economic  benefit  to  the  uNlity  and  its  ratepayers.  Combined  heat-­‐and-­‐power  systems  
in  campus  microgrids  such  as  the  University  of  AusNn-­‐Texas  decrease  cost  and  carbon  
emissions.    
• Strengthen  Local  Economies.  When  an  electric  bill  is  paid,  the  money  typically  leaves  the  
community  to  distant  shareholders  and  large  corporaNons.  But  with  a  local  microgrid  
that  employs  resources  owned  by  community  members,  dollars  stay  in  town  and  
customers  may  even  have  the  ability  to  buy  and  sell  power  and  services  with  one  
another.  The  microgrid’s  network  enables  households  to  coordinate  energy  saving  
measures,  sending  energy  bills  downward  even  more.  Resiliency  in  the  form  of  less  
outages  helps  avoid  economic  losses  from  electricity  –  up  to  $75  billion  dollars  in  lost  
economic  output  per  year  in  the  U.S.  Businesses  that  depend  on  power  quality  may  be  
drawn  to  regions  with  high  power  quality  from  microgrids.12  
• Transform  the  Grid  and  UQliQes.  The  electric  grid  is  changing.  In  the  words  of  one  
engineer,  it’s  becoming  a  smart  grid,  full  of  distributed  energy  users  that  transact  with  
each  other.13  Depending  on  regulaNons,  it  could  become  an  environment  where  
everyone  could  produce  energy,  not  just  uNliNes.  The  grid  could  be  a  neutral  
marketplace  in  which  a  microgrid  presents  the  opportunity  for  a  community  to  
opNmize  all  features  of  the  new  smart  grid  —  everything  from  smart  thermostats  and  
storage  to  solar  and  electric  vehicles  —  in  one  locaNon  for  the  direct  local  benefit  of  
the  people  involved.  

Microgrids  offer  an  intriguing  technological  and  electricity  market  future.  The  next  secNon  
provides  examples  of  microgrids  and  how  they  are  evolving.  

Page 9 of 37 Institute for Local Self-Reliance

A  Possible  Future  Distribution  Architecture

Chart credit: National Energy Technology Laboratory

Mighty  Microgrids  
Spreading  Community  Microgrids  for  Resilience  in  New  England  
When  Hurricane  Sandy  hit  New  England,  it  cut  power  to  8.5  million  people,  and  lei  more  than  
one  million  without  power  for  a  week  as  electric  uNliNes  struggled  to  clean  up  the  wreckage.14  
Making  ma$ers  worse,  up  to  60  percent  of  backup  diesel  generators  failed  for  medical  centers,  
first  responders,  and  other  criNcal  faciliNes.15    

With  a  15  megawa$  (MW)  combined  heat  and  power  generator  as  well  as  5.3  MW  of  solar,  
Princeton  University’s  microgrid  kept  its  campus  live  for  three  days  while  power  was  cut  during  
Hurricane  Sandy.16    South  Oaks  Hospital,  a  245-­‐bed  healthcare  facility  on  Long  Island,  remained  
disconnected  from  the  grid  for  fiieen  days  aier  Sandy  with  the  help  of  its  1.25  MW  combined  
heat  and  power  generator  and  47  kilowa$s  (kW)  of  solar.  The  hospital  accepted  paNents  from  
other  sites  that  lost  power  during  the  storm.  

Page 10 of 37 Institute for Local Self-Reliance

With  climate  change  likely  to  worsen  or  make  storms  like  Sandy  more  frequent,  Northeastern  
states  provided  $400  million  to  fund  the  development  of  community  microgrids  and  resilient  
infrastructure.  Because  of  these  programs,  more  than  40  municipaliNes  in  the  Northeast  will  
have  microgrid  projects  completed  in  the  next  year.    

In  2012,  ConnecNcut  became  the  first  state  to  create  a  microgrid  funding  program,  with  $48  
million.  Unlike  other  programs,  which  mostly  fund  feasibility  studies,  the  ConnecNcut  Microgrid  
Program  funds  the  cost  of  design,  interconnecNon,  and  engineering  services.17  The  state  
legislature  also  allowed  municipal  microgrids  to  cross  public  rights-­‐of-­‐way,  a  right  usually  
reserved  and  protected  by  the  incumbent  electric  uNlity.18  

The  first  two  funding  rounds  in  ConnecNcut  supported  11  projects.  Most  projects  in  the  first  
round  relied  heavily  on  diesel  generators.  To  avoid  the  polluNon  that  comes  from  using  diesel,  
the  state  changed  the  rules  in  the  second  round  to  limit  diesel  generaNon  and  incenNvize  
renewable  energy  and  storage.19  According  to  Peter  Asmus,  principal  research  analyst  with  
Navigant  Research,  the  program  has  been  complicated  by  stringent  requirements  for  long-­‐term  
islanding  and  lack  of  metrics  for  resiliency.  Furthermore,  uNliNes  in  ConnecNcut  are  sNll  
concerned  about  where  their  ownership  of  the  grid  ends,  and  the  microgrid  begins.  

Milford,  Conn.,  won  nearly  $3  million  for  its  second  round  proposal.  The  microgrid  joins  
together  criNcal  faciliNes  such  as  government  centers,  an  apartment  building,  a  middle  school,  
and  a  senior  center. 20  Power  generaNon  comes  mainly  from  combined  heat-­‐and-­‐power,  with  
more  than  40  percent  of  its  capacity  coming  from  solar  and  storage.  

New  York,  already  a  leader  in  microgrid  development,21  offered  the  naNon’s  first  microgrid  prize,  
with  $40  million  to  fund  feasibility  studies  
for  municipal  microgrids.  Overwhelmed  
by  proposals,  the  state  awarded  funds  for  
83  feasibility  studies,  58  more  than  
originally  intended.22  As  shown  on  the  
right,  these  projects  across  the  state  
present  an  array  of  local,  renewable  
energy  projects.  One  project  in  Long  
Island  from  the  Clean  CoaliNon  seeks  to  
achieve  nearly  50  percent  of  its  local  
energy  needs  through  15  megawa$s  of  
local  solar  producNon,  also  deferring  a  
proposed  $300  million  transmission  
project  of  the  local  uNlity  by  providing  25  
megawa$-­‐hours  of  energy  storage.23    
Map credit: New York State Energy Research and Development

Page 11 of 37 Institute for Local Self-Reliance

The  microgrid,  while  providing  a  plavorm  to  integrate  
high  levels  of  solar  and  storage,  will  provide  backup  
power  to  a  water  pumping  and  filtraNon  facility  as  well  as  
a  firehouse.24  Westchester  County  boasts  the  largest  
number  of  microgrids  supported  by  NY  Prize  money:  14  
different  projects  by  a  variety  of  vendors.  It  is  a$empNng  
to  use  the  “community  choice  aggregaNon”  model  —  
providing  local  control  over  electricity  purchases  for  all  
customers  —  as  a  vehicle  to  coordinate  microgrids  
developed  by  mulNple  parNes  on  a  regional  basis,  a  one-­‐
of-­‐a-­‐kind  approach.25    

Like  the  example  above,  other  projects    also  bring  in  

several  third-­‐party  technology  vendors,  uNliNes,  and  
adjacent  towns  or  government  agencies  on  a  proposal.26  
More  than  half  uNlize  solar.  Nearly  half  uNlize  a  form  of  
storage.  One  focuses  on  low-­‐income  ciNzens  in  Brooklyn,  
another  on  a  food  distribuNon  center  that  supplies  60  
percent  of  New  York  City’s  produce,  meat,  and  fish.  These  
projects  will  move  into  construcNon  within  the  next  few  
years.    

In  Maryland,  BalNmore  Gas  &  Electric  is  now  proposing  to  

build  and  own  two  microgrid  projects  following  state  task  
force  recommendaNons,  although  both  will  rely  solely  on  
natural  gas  generators.  Meanwhile,  the  first  commercial  
solar-­‐and-­‐storage  microgrid  was  built  in  2013  at  Konterra  
Realty  headquarters  in  Laurel,  Md.27  By  selling  frequency  
regulaNon  and  demand  response  service  into  the  
electricity  market,  it  generates  revenue  while  also  serving  
as  a  power  backup.  The  microgrid  also  supplies  two  
electric  car-­‐charging  ports.    

Page 12 of 37 Institute for Local Self-Reliance

Microgrids  Serving  Single  Users  and  Campuses  

Chart credit: University of Texas, Austin

Microgrids  are  most  commonly  used  today  to  supply  reliability  that  is  unmatched  by  the  larger  
grid.  The  most  common  customers  include  faciliNes  owned  by  the  military,  universiNes,  schools,  
and  hospitals  (MUSH,  for  short).    

Most  of  these  microgrids  simply  supply  backup  power.28  Some  microgrids  go  beyond  to  provide  
be$er  energy  services  internally  and  to  the  larger  grid.  One  of  the  United  State’s  largest  
microgrids  is  located  at  the  University  of  Texas,  AusNn.  A  137  MW  combined  heat  and  power  
generator  burns  natural  gas,  providing  the  campus  with  100  percent  of  its  electricity.  It  also  
provides  heaNng  and  cooling  services  by  transferring  the  waste  heat  through  a  district  energy  
system  consisNng  of  a  series  of  underground  pipes  that  carry  steam  and  chilled  waters  to  all  
corners  of  the  campus.29    

The  80+  year-­‐old  CHP  system  captures  88  percent  of  the  energy  that  goes  into  the  generator,  
compared  to  old  coal  plants  that  are  30  to  40  percent  efficient.  The  campus  microgrid  is  also  
more  than  30  Nmes  more  reliable  than  the  naNon’s  electric  grid.30  As  shown  above,  thanks  to  
massive  investments  in  energy  efficiency,  the  UT-­‐AusNn  microgrid  kept  greenhouse  gas  
emissions  and  fuel  use  level  even  while  the  campus  and  its  energy  usage  grew  by  20  percent.  
The  university  has  saved  more  than  $4  million  a  year  with  its  microgrid,  compared  to  buying  
energy  from  the  grid  alone.    

Page 13 of 37 Institute for Local Self-Reliance

Arguably  one  of  the  most  sophisNcated  single-­‐user  
microgrids  is  at  Santa  Rita  Jail  in  California’s  Bay  
Area.31  The  jail’s  microgrid  effecNvely  presents  its  
varied  resources  —  including  solar,  wind,  fuel  cells,  
storage,  and  diesel  generators  —  to  the  larger  grid  as  
one  controlled  resource,  appearing  just  like  any  other  
house  or  building.32  It  can  store  energy,  self-­‐supply,  
or  buy  energy  from  the  larger  grid,  using  
sophisNcated  electronics  to  balance  onsite  
generaNon  and  demand.33    

At  the  Santa  Rita  microgrid,  each  distributed  resource  

has  its  own  control  scheme  and  can  communicate  
with  the  other  technologies,  whether  generators  or  
storage  systems,  peer-­‐to-­‐peer.  It  thereby  distributes  
the  responsibility  of  control,  in  contrast  to  most  
other  microgrid  controls  which  rely  on  a  single  
master  controller.    

The  system  reduces  the  chance  for  complete  system  

failure,  because  each  component  can  independently  
adjust  if  another  fails.  The  peer-­‐to-­‐peer  controls  of  
the  Santa  Rita  Jail  allow  the  grid  to  self-­‐heal  and,  
perhaps  most  importantly,  easily  add  new  distributed  
energy  without  having  to  completely  redesign  the  
control  system.  The  result  of  peer-­‐to-­‐peer  control  
technology  is  a  more  sustainable  and  adaptable  
microgrid.  

Page 14 of 37 Institute for Local Self-Reliance

The Microgrid Controller Utilities  Test  the  
A microgrid requires a processor to make it Waters  
think and move. These controls come in two
main forms: centralized master controls or While  East  Coast  communiNes  explore  
decentralized peer-to-peer controls. Both styles, the  microgrid’s  future,  some  uNliNes  
not necessarily mutually exclusive, incorporate
are  building  state-­‐of-­‐the-­‐art  microgrids  
common responsibilities such as the ability to
autonomously island the microgrid from grid themselves.  With  smart  control  
disturbances, balance generation and load, and systems  and  the  ability  to  incorporate  
respond to pricing signals and other events.
customer-­‐owned  energy  generaNon,  
Like a conductor for an orchestra, master these  microgrids  show  what  a  uNlity  
controls control everything. They typically can  do  for  its  customers  and  the  larger  
maintain voltage and frequency for the local
generators, such that a certain level of power grid  to  prepare  for  the  future.  
quality is maintained throughout the microgrid.  
With peer-to-peer controls, however, each local Oncor,  Oncor!  
generator acts as just one member of a band,
maintaining its own voltage and frequency, Texas-­‐based  Oncor,  the  sixth-­‐largest  
communicating with its “peer” generators to transmission  and  distribuNon  uNlity  in  
output optimal power quality. Generally, master
controls are the more trusted technology, while the  naNon,  was  looking  to  upgrade  an  
peer-to-peer controls allow for easier old  environmental  center  when  senior  
maintenance. Larger vendors tend to want to management  had  an  idea.34  The  new  
adapt existing controls used for higher voltage
systems for microgrids; smaller vendors, facility  was  for  an  electrical  component  
without legacy products, favor a more bottoms- tesNng  facility  as  well  as  
up and distributed controls platform. telecommunicaNons.  It  couldn’t  afford  
References
Lasseter, Bob. “U.S. Department of Energy Electricity Advisory Committee.” to  lose  power.  So  why  not  make  it  a  
University of Wisconsin – Madison: College of Engineering. October 20, 2011.
(Accessed February 9, 2016). http://energy.gov/sites/prod/files/EAC microgrid?  
%20Presentation%20-%20Microgrids%202011%20-%20Lasseter.pdf.

The  System  OperaNng  Services  Facility,  

just  south  of  Dallas,  Texas,  is  actually  a  
combinaNon  of  four  independent  microgrids.  Together,  it  uses  several  sources  of  generaNon,  
including  diesel  generators,  natural  gas  microturbines,  solar  arrays,  and  two  energy  storage  
devices.  The  control  system  constantly  monitors  for  faults,  severing  the  connecNon  to  the  larger  
grid  should  anything  go  awry.  AddiNonally,  according  the  Power  Magazine,  the  controls  are  
smarter  than  most,  automaNcally  “leveraging  market  pricing  signals,  weather  and  forecasNng  
informaNon,  historical  energy  usage  data,  and  real-­‐Nme  building  informaNon  to  conNnually  seek  
out  the  lowest-­‐cost  power  [from  the  grid  or  microgrid].”  

As  a  transmission  and  distribuNon  uNlity,  Oncor  can’t  legally  sell  any  power  to  the  market,  so  its  
microgrid  is  limited  to  using  stored  power  to  offset  its  own  purchases.35  Further  market  changes  
in  Texas  that  allow  the  uNlity  to  sell  stored  energy  to  merchant  generators  will  be  needed  before  
microgrids  and  storage  can  tap  this  revenue  stream.  

Page 15 of 37 Institute for Local Self-Reliance

Borrego  Springs:  An  Evolving  Look  at  
Community  
Borrego  Springs  is  a  rural  town  of  2,800  people  in  southern  
California.  Connected  to  the  larger  grid  by  a  single,  aging  
transmission  line,  Borrego  Springs  was  a  natural  
demonstraNon  site  for  a  microgrid.  San  Diego  Gas  &  
Electric,  supported  almost  enNrely  by  federal  and  state  
funding,  ouvi$ed  the  town  with  diesel  generators,  
storage,  and  demand  response  technology,  while  
incorporaNng  26  exisNng  rooiop  solar  installaNons  (a  total  
of  597  kilowa$s),36  smart  meters,  and  residenNal  energy  
storage.37  According  to  the  project’s  lead  engineer,  “the  
focus  was  not  just  on  bringing  in  new  generaNon,  but  
rather  looking  at  [exisNng]  resources  to  facilitate  the  
microgrid  implementaNon.”38  

Jamie  Pa$erson,  an  employee  of  the  California  Energy  

Commission,  explained  that  one  of  the  biggest  challenges  
for  this  microgrid  was  building  a  controller  to  fully  uNlize  
the  exisNng  customer-­‐based  resources.39  Unable  to  agree  
on  contractual  terms  with  vendors  to  build  a  universally  
applicable  microgrid  controller  for  scaling  other  potenNal  
microgrids,  the  uNlity  instead  made  a  project-­‐specific  
microgrid  visualizer  that  enables  the  uNlity  to  monitor  all  
microgrid  operaNons.  Recently  the  uNlity  installed  a  new  
control  system  with  the  vendor  Spirae  called  “Wave,”  
allowing  the  uNlity  to  be$er  coordinate  diesel  generators,  
electric  car  charging,  and  storage  charging.  

The  microgrid  successfully  islanded  during  a  severe  storm  

event  in  the  summer  of  2013,  potenNally  saving  dozens  of  
ciNzens’  lives  by  providing  cooling  zones  during  the  
intensity  of  triple-­‐digit  heat,  according  to  project  
representaNves.  Aier  adding  connecNon  to  a  26  MW  solar  array  in  2015,  Borrego  Springs  
became  the  first  microgrid  in  the  United  States  to  rely  heavily  on  only  solar  energy  and  storage  
during  a  planned  outage.40  

Project  organizers  stressed  the  need  to  involve  the  users  every  step  of  the  way  to  making  a  
microgrid.  Borrego  Springs  residents,  as  it  turned  out  were  enthusiasNc  about  the  project,  
according  to  a  report  from  the  AssociaNon  for  Demand  Response  &  Smart  Grid:  

Page 16 of 37 Institute for Local Self-Reliance

“Under  the  original  plan,  cycling  of  air  condi'oners  
during  an  event  was  suggested  to  allow  temperatures  up  
to  80  degrees  within  residences.  However,  customers  
asked  for  that  level  to  be  raised  even  higher  to  90  
degrees  in  order  to  provide  even  more  energy  savings  for  
the  microgrid.” 41  

Stafford  Hill:  Nothing  But  Solar  

Green  Mountain  Power  was  leasing  a  landfill  from  the  
city  of  Rutland,  Vt.,  when  its  employees  had  a  thought.  
Knowing  the  city  wanted  to  become  the  “solar  capital  of  
New  England”  (with  the  most  solar  wa$s  per  capita),  the  
uNlity  decided  to  expand  a  proposal  for  solar  power  into  
a  microgrid.  In  2015,  the  uNlity  built  the  naNon’s  first  
solar-­‐plus-­‐storage  only  microgrid  that  was  capable  of  
providing  full,  indefinite  backup  to  its  criNcal  facility,  in  
this  case  a  local  high  school.    

With  2.5  MW  of  solar  and  4  MW  of  ba$ery  storage,  the  
Stafford  Hill  microgrid  works  like  any  other  solar  array  
with  ba$ery  storage  during  normal  operaNon,  providing  
ancillary  services  such  as  frequency  regulaNon  and  
capacity  to  the  larger  grid. 42  The  Stafford  Hill  microgrid  
will  provide  total  energy-­‐related  benefits  of  $350,000  to  
$700,000  per  year  and  pay  itself  off  in  less  than  10  
years.43  

The  Stafford  Hill  microgrid  is  just  one  way  Green  

Mountain  Power  is  trying  to  “stay  ahead  of  customer  
demand”  for  solar  integraNon.  The  uNlity  wants  to  
expand  the  Stafford  Hill  microgrid  to  include  customer-­‐
sited  solar  panels  as  well  as  smart  appliances  like  electric  
water  heaters  that  can  instantly  adjust  when  they  use  
energy.  The  uNlity  is  also  financing  tesla  ba$eries  for  its  
customers  and  planning  to  offer  solar  and  storage  microgrid  soluNons  to  other  communiNes.44  

Green  Mountain  Power  stands  out,  but  in  part  because  is  the  only  investor-­‐owned  uNlity  also  
registered  as  a  Benefit  CorporaNon,  meaning  the  uNlity  is  legally  able  to  balance  the  concerns  of  
shareholders  with  society  and  the  environment.45  

Page 17 of 37 Institute for Local Self-Reliance

Islands  and  Remote  Locales  with  High  
Renewable  Energy    
Due  to  the  high  cost  of  imporNng  fuel  oil  for  electricity,  
and  without  a  larger  grid  to  connect  to,  many  islands  are  
natural  locaNons  for  heavily  renewable  microgrids.    

According  to  the  Rocky  Mountain  InsNtute,  Kodiak  Island  

in  Alaska  is  among  the  largest  of  these  high  renewable  
microgrids.46  Kodiak  Island  uses  hydro  power,  wind  
turbines,  and  storage  for  its  energy.  The  hydro  acts  as  a  
baseload,  while  the  turbines  combine  with  the  a  lead-­‐acid  
ba$ery  and  flywheel  energy  systems  to  handle  long-­‐  and  
short-­‐term  energy  needs,  respecNvely.  Since  2000,  
electricity  costs  have  conNnued  to  fall  with  more  
renewable  energy  integraNon.  The  community  saves  
around  $4  million  a  year  compared  to  using  only  diesel.  
More  stable  electricity  rates  have  even  led  to  expansion  in  
the  local  fishing  industry.  The  average  residenNal  rate  is  
$0.14  per  kilowa$-­‐hour,  only  marginally  higher  than  for  
the  average  grid-­‐connected  customer  in  the  lower  48  
states.  

Hawai’i  is  among  the  world  leaders  in  renewable  energy  

and  in  microgrids.  Most  of  the  Hawaiian  Islands’  
electricity  comes  from  burning  oil,  but  as  prices  rose  in  
recent  years,  the  price  of  electricity  did  too.  Electric  rates  
were  two  to  four  Nmes  higher  than  those  on  mainland  
United  States.  As  a  result  of  high  electricity  prices,  more  
than  70,000  customers  across  Hawai’i  turned  to  rooiop  
solar. 47    

On  the  northern  Np  on  Hawai’i  Island,  a  100-­‐kilowa$  wind  

turbine  with  energy  storage  and  a  small  amount  of  solar  powers  a  water  pump  for  14  farms  and  
400  acres. 48  The  water  is  pumped  to  a  storage  reservoir,  which  supplies  water  to  farmers  
through  a  gravity-­‐fed  irrigaNon  system.  The  project  is  funded  mostly  through  the  U.S.  
Department  of  Energy.  

Page 18 of 37 Institute for Local Self-Reliance

On  Kauai,  home  to  the  Kauai  Island  UNlity  CooperaNve,  solar  someNmes  provides  more  than  90  
percent  of  daily  peak  load.49  Kauai’s  yearly  energy  needs  are  met  by  more  than  40  percent  
renewable  energy,  and  the  uNlity  is  increasingly  using  solar-­‐plus-­‐storage  to  reach  even  high  
rates  of  renewables.  On  the  island  of  Hawai’i,  robust  geothermal  resources  support  more  than  
50  percent  renewable  energy.  On  the  islands,  solar  and  other  renewable  resources  are  oien  the  
cheapest  energy  source,  as  revealed  by  a  previous  ILSR  report.50  

This   chart   dates   to   October   2015.   Since   then,   world   oil   prices   have   crashed,   but   Hawai’i’s   costs   regarding   fuel   oil  
have   remained   largely   the   same.   Solar   unsubsidized   by   the   federal   Investment   Tax   Credit   is   sQll   at   parity   with  
centralized  generaQon  and  might  even  be  cheaper  following  years  of  cost  declines.    
Source:  InsQtute  for  Local  Self-­‐Reliance

Page 19 of 37 Institute for Local Self-Reliance

Wheels  to  the  Road  in  San  Diego  an  ElectriKied  Economy  
The  University  of  California,  San  Diego,  supplies  92  percent  of  its  own  energy.  Its  microgrid,  
based  mainly  on  a  combined  heat-­‐and-­‐power  natural  gas  generator  as  well  as  several  solar  and  
storage  projects,  saves  the  university  over  $8  million  annually.51  This  microgrid  saves  the  
university  over  $8  million  annually.  The  campus  is  also  home  to  some  of  the  most  innovaNve  
electric  vehicle  pilot  programs,  sending  power  from  car  ba$eries  back  to  the  larger  grid.  

Using  parked  car  ba$eries  as  energy  resources  is  gaining  tracNon,  but  especially  in  microgrids.  
Some  military  base  microgrids  use  electric  vehicles  to  help  reduce  peak  demand  and  earn  
revenue  by  performing  grid  services  like  frequency  regulaNon.52  UCSD’s  microgrid,  like  others,  
already  has  the  ability  to  ramp  down  car  charging  to  reduce  demand  on  campus.53  “In  general,”  
according  to  a  study  from  Lawrence  Berkeley  NaNonal  Laboratory,  “the  link  between  a  microgrid  
and  an  electric  vehicle  can  create  a  win-­‐win  situaNon,  wherein  the  microgrid  can  reduce  uNlity  
costs  by  load  shiiing  while  the  electric  vehicle  owner  receives  revenue  that  parNally  offsets  his/
her  expensive  mobile  storage  investment.”54    

Chart credit: National Renewable Energy Laboratory

Page 20 of 37 Institute for Local Self-Reliance

In  a  microgrid,  electric  vehicles  can  absorb  solar  energy  when  the  sun  is  high,  or  stagger  charges  
to  avoid  peak  demand  costs. 55  As  shown  in  the  chart  above,  the  orange  line  represents  what  
happens  when  electric  vehicles  charge  all  at  once.  CollecNvely,  their  demand  pushes  the  peak  
demand  of  the  facility  upward,  resulNng  in  a  higher  demand  charge  from  the  uNlity.  In  contrast,  
electric  vehicles  that  sequence  and  synchronize  their  charging  cycles  aier  each  other  result  in  
uniform,  more  easily  controlled  demand  that  avoids  high  demand  charges.  

Car  ba$eries,  so  long  as  the  owners  are  properly  compensated  for  extra  wear  and  tear,  can  be  
aggregated  to  aid  the  grid.  The  new  program  at  San  Diego  does  so:  vehicles  will  receive  grid  
commands  and  price  data  from  the  microgrid.  If  energy  prices  are  high,  they  will  discharge;  if  
they  are  low,  they  will  charge.  This  pracNce,  known  as  “vehicle  to  grid,”  has  been  largely  
untapped,  save  for  one  program  at  the  University  of  Delaware  now  running  in  its  third  year.  As  
one  GreenTech  Media  arNcle  explains,  almost  all  exisNng  electric  vehicle  chargers  only  aid  the  
grid  by  reducing  the  rate  of  car  charging,  not  sending  power  to  the  grid.56      

The  campus  microgrid  plans  to  host  70  chargers,  the  third  most  of  any  locaNon  in  California.  
While  campus  representaNves  say  that  won’t  make  a  dent  in  present  energy  usage,  they’re  
more  concerned  about  the  next  five  years,  as  the  campus  becomes  a  charging  resource  to  
university  employees  who  don’t  have  powerful  chargers  at  home.  

Growing  Grassroots  Microgrids  in  California    

Last  year  California  was  the  first  state  in  the  country  to  require  its  electric  uNliNes  to  submit  
distribuNon  resource  plans.57  Combined  with  community  choice  aggregaNon  –  allowing  ciNes  to  
purchase  power  from  a  microgrid  –  and  a  state-­‐mandated  reliance  on  renewable  energy,  these  
new  plans  may  boost  microgrid  development.  

Usually,  uNliNes  consider  top-­‐down  approaches  —  large  power  plants  and  long  power  lines  —  in  
electric  grid  planning,  and  file  these  integrated  resource  plans  with  regulators  every  few  years.  
DistribuNon  resource  plans  approach  grid  planning  from  the  ground  up,  making  each  uNlity  
assess  the  best  locaNons  and  reimbursement  schemes  to  bring  distributed  resources  online.58  
Rooiop  solar,  energy  efficiency,  and  microgrids  must  be  considered  alongside  large  power  
plants  and  long  power  lines,  and  the  data  must  be  provided  to  the  public  and  third  party  
developers  alike.  

As  a  result  of  the  new  regulaNons,  one  of  the  three  largest  uNliNes  in  California,  Pacific  Gas  &  
Electric,  has  started  planning  its  first  uNlity-­‐sponsored  microgrid  at  Angel  Island  State  Park.59  
With  100  kilowa$s  of  demand,  or  the  energy  that  is  needed  on  the  island  on  a  daily  basis,  the  
project  is  intended  uNlize  renewable  resources  to  reduce  dependency  on  the  cable  that  
connects  electricity  to  the  island.    

Page 21 of 37 Institute for Local Self-Reliance

The  Blue  Lake  Rancheria  microgrid,  with  funds  from  the  California  Energy  Commission,  is  also  
building  a  microgrid  to  benefit  its  51  tribal  members  in  Northern  California.60  The  county  is  
connected  to  the  larger  grid  by  a  single,  70-­‐megawa$  power  line,  vulnerable  to  earthquakes  and  
more-­‐frequent  wildfires.  A  175  kilowa$  biomass-­‐to-­‐fuel-­‐cell  generator  and  several  smaller  
diesel  generators  are  onsite,  and  the  tribe  will  add  500  kilowa$s  of  solar,  and  800  kilowa$s  of  
energy  storage,  to  advance  toward  its  goal  of  100  percent  renewable  energy.61  Once  the  
microgrid  is  constructed,  it  will  sell  demand  response  services  into  the  market,  while  reducing  
peak  demand  locally.  

This  microgrid  may  also  be  a  model  for  aiding  poverty-­‐stricken  rural  communiNes,  or  those  that  
sNll  lack  a  grid  connecNon.  One  in  five  people  in  Humboldt  County  are  below  the  federal  poverty  
level  and,  in  general,  14  percent  of  households  on  NaNve  American  reservaNons  lack  access  to  
electricity.  As  the  cost  of  building  power  line  to  remote  areas  can  reach  $60,000  per  mile,  Blue  
Lake  Rancheria’s  microgrid  might  be  a  soluNon  other  rural  communiNes  can  use.62  


Community Microgrids
Distributed  energy  advocacy  group  Clean  CoaliQon,  heavily  involved  in  the  new  distribuQon  planning  rules,  is  
designing  a  community  “microgrid”  in  the  Bayview-­‐Hunters  Point  area  of  San  Francisco.  

The   Hunters   Point   Community   Microgrid   Project   will   add   up   to   30   megawa`s   of   rooOop   solar   to   meet   25  
percent   of   the   yearly   energy   needs   of   over   35,000   residents.   The   community,   where   30   percent   of   families  
there   earn   less   than   $10,000   per   year,   should   benefit   from   more   than   $120   million   in   regional   economic  
sQmulaQon.  

Pacific  Gas  &  Electric,  the  incumbent  uQlity,  is  sQll  deciding  to  how  to  go  ahead  with  this  proposal,  wherein  
the   Clean   CoaliQon   will   select   priority   loads   to   island   in   case   of   a   larger   grid   disturbance.   With   these  
microgrids   as   base   points,   the   Hunters   Point   Community   Microgrid   Project   will   emphasize   how   to   scale  
rooOop  solar  with  proper  technology  and  planning.  

References:  
Thomson,   Greg.   “Community   Microgrid   IniQaQve   Overview.”   Clean   Coali)on.   October   15,   2015.   (Accessed   February   11,   2016).   h`p://www.clean-­‐
coaliQon.org/site/wp-­‐content/uploads/2015/10/Community-­‐Microgrid-­‐Overview-­‐15-­‐Oct-­‐2015.pdf.  

Clean  CoaliQon.  “ The  Hunters  Point  Project:  A  Model  for  Clean  Local  Energy.”  March  26,  2014.  (Accessed  February  11,  2016).  h`p://www.clean-­‐coaliQon.org/
site/wp-­‐content/uploads/2015/08/HPP-­‐Benefits-­‐Analysis-­‐Summary-­‐22_jv-­‐10-­‐Feb-­‐2016.pdf.    

Email  with  John  Bernhardt,  Outreach  and  CommunicaQons  Director  at  Clean  CoaliQon.  1/21/2016.

Page 22 of 37 Institute for Local Self-Reliance

Why  the  Microgrid  Market  Will  Explode  
The  microgrid  industry  is  just  entering  commercial  development.  There  is  no  standardized  
microgrid,  as  most  projects  are  “one-­‐offs,”  unique  in  their  technology,  control  systems  and  
financing.  But  there  are  hints  at  microgrids  becoming  more  economical  and  easy  to  build.  In  
fact,  with  the  declining  cost  of  solar  PV,  wind  and  advanced  ba$eries,  many  microgrids  under  
development  today  can  provide  more  reliable  and  cleaner  electricity  than  the  grid  –  and  at  a  
lower  cost.    

A  few  companies  such  as  SolarCity  are  beginning  to  offer  “turnkey”  nanogrids,  which  are  ready  
immediately  upon  installaNon,  for  single  buildings.63  Solar  and  storage  prices  are  rapidly  falling,  
as  much  as  ten  percent  per  year.  The  Rocky  Mountain  InsNtute  suggests  that  many  residenNal  
customers  could  economically  reduce  or  remove  enNrely  their  electricity  demand  from  the  grid  
within  the  next  ten  years.  Some  microgrids  are  currently  reporNng  five  to  ten  year  paybacks.64  
Even  the  strictly  solar  and  storage  project  at  Stafford  Hill  reports  a  payback  of  less  than  10  years.  

Other  trends  could  accelerate  microgrid  growth.  Energy  analysts  at  Navigant  saysif  regulatory  
authoriNes  develop  new  rules,  and  industry  develops  standardized  business  models  for  
microgrids,  then  more  microgrids  could  be  adopted  than  predicted. 65  More  cost  reducNons  and  
public  funding  will  be  key  to  support  microgrid  formaNon.  Many  uNliNes,  which  have  sought  to  
outright  block  microgrids  in  the  past,  and  now  invesNgaNng  what  role  they  might  play.    

A  few  state  and  local  policies  and  programs  are  emerging  to  support  microgrid  development:  
• Public  financing  programs.  The  U.S.  Department  of  Energy  is  pu{ng  hundreds  of  millions  
of  dollars  into  microgrids  and  grid  modernizaNon.66  New  York  has  a  $40  million  
microgrid  program.67  ConnecNcut  has  a  $48  million  dollar  microgrid  program.  New  
Jersey  pays  for  up  to  30  percent  of  energy  storage  projects  and  has  a  $200  million  
Energy  Resilience  Bank  providing  grants  and  loans  for  distributed  energy  projects  at  
criNcal  faciliNes.    
• Municipal  uQliQes  and  electric  cooperaQves.  With  local  control  over  the  wires  in  town,  
municipal  and  member-­‐owned  uNliNes  have  the  benefit  of  bypassing  the  fight  against  
an  incumbent  uNlity  for  control  of  energy  and  distribuNon  in  the  microgrid.  Fort  
Collins,  Colo.’s  municipal  uNlity,  for  example,  has  begun  integraNng  microgrid  
technologies  into  the  local  businesses  and  university.68  Norwich,  Conn.,  established  a  
microgrid  connecNng  the  local  hospital  with  a  gas  staNon  and  other  criNcal  faciliNes.69  
DistribuNon  cooperaNves  and  their  generaNon  and  transmission  cooperaNves  could  
begin  working  together,  the  NaNonal  Rural  Electric  CooperaNve  AssociaNon  writes,  to  
provide  microgrid  services  at  the  retail  level  while  working  supporNng  the  stability  of  
the  grid  as  a  whole.70  

Page 23 of 37 Institute for Local Self-Reliance

• Market  rules  to  making  uQliQes  indifferent  toward  distributed  energy.  State  policies  that  
decouple  uNlity  revenues  from  how  many  kilowa$-­‐hours  they  sell  (called  decoupling),  
and  policy  that  rewards  them  for  their  performance,  not  their  capital  projects  (called  
performance-­‐based  regulaNon),  can  both  help  incenNvize  uNliNes  to  look  beyond  
owning  and  controlling  the  energy  market.  Decoupling  helps  because  uNliNes  become  
indifferent  to  the  loss  of  sales  to  microgrid  owners.  Performance-­‐based  regulaNon  
means  they  are  indifferent  to  the  ways  microgrids  reduce  the  opportunity  for  making  a  
return  on  new  capital  investments  such  as  substaNon  upgrades  or  new  power  
generaNon.  Taken  together  with  other  policies  such  as  retail  rate  reform  and  
distribuNon  planning,  states  can  be$er  promote  distributed  generaNon  and  
microgrids.  

Microgrid  development,  parNcularly  microgrids  between  mulNple  uNlity  customers,  requires  a  

reckoning  with  the  uNlity  monopoly  structure,  the  status  quo  in  many  states.  Either  microgrids  
are  given  official  policy  blessing  or  they  may  be  limited  to  single  customers  or  uNlity  ownership.  

This  is  why  the  Reforming  the  Energy  Vision  (REV)  regulatory  proceeding  in  New  York  state  is  so  
important  to  microgrids.71  REV’s  end  goal  is  to  create  a  resilient  grid,  but  more  by  decentralizing  
power  producNon  and  making  the  electric  uNlity  less  a  dominaNng  market  force  than  a  
disinterested  grid  operator.  The  83  microgrid  proposals  under  the  state’s  microgrid  program  are  
the  start  to  what  could  be  a  market  of  decentralized  generators  within  communiNes  across  the  
state.  

Page 24 of 37 Institute for Local Self-Reliance

Why  Microgrids  Face  Macro-­‐Problems  
If  the  status  quo  conNnues  and  rules  do  not  change,  then  growth  will  likely  be  limited  to  
parNcular  places  and  as  Navigant  says,  “the  microgrid  market  opportunity  [will  be]  only  large  
enough  to  support  a  handful  of  players.”72  In  other  words,  despite  growth  in  microgrid  
development,  uNliNes  will  conNnue  to  control  the  electric  grid.  

There  are  five  substanNal  barriers  to  rapid  growth  of  community  microgrid  development:  

1.  A  “microgrid”  is  undefined  in  most  state  rules  

Microgrids  are  largely  uncommon  because  it’s  illegal  in  most  states  for  someone  beside  the  
incumbent  uNlity  to  sell  or  distribute  electricity.  And  even  if  the  microgrid  could  sell  or  
distribute  electricity,  it  might  risk  being  labeled  as  a  public  uNlity  and  be  subject  to  costly  
regulaNon.    

In  other  words,  states  may  need  to  define  a  microgrid  in  order  to  clarify  its  legal  standing  
within  the  state  and  how  it  will  be  regulated.  So  far,  only  ConnecNcut  has  completed  a  
statutory  microgrid  definiNon.73    

Under  ConnecNcut  law,  a  microgrid  is  “a  group  of  interconnected  loads  and  distributed  
energy  resources  within  clearly  defined  electrical  boundaries  that  acts  as  a  single  
controllable  enNty  with  respect  to  the  grid  and  that  connects  and  disconnects  from  such  
grid  to  enable  it  to  operate  in  both  grid-­‐connected  or  island  mode.”  It  includes  exempNons  
from  the  uNlity’s  franchise  (more  on  that  below)  and  microgrid  size  allowances.  

Other  states  Maryland,  Massachuse$s,  California,  and  New  York  are  also  grappling  with  how  
to  define  microgrids  through  state  law.74  One  Minnesota  study  from  the  Microgrid  InsNtute  
lays  out  preferable  items  to  include  in  the  possible  definiNon  (some  included  below):75  
• Allow  ownership,  operaNon,  and  energy  sales  by  microgrid  hosts,  independent  
developers,  and/or  uNliNes  
• Eschew  limits  on  microgrid  size  
• Establish  that  microgrids  are  not  duplicaNve  of  uNlity  faciliNes  (so  as  to  not  run  afoul  of  
the  uNlity’s  state-­‐sancNoned  monopoly)  

Page 25 of 37 Institute for Local Self-Reliance

2.  The  uQlity’s  franchise,  public  right-­‐of-­‐way,  and  who  legally  sells/distributes  energy  
Community  microgrids  connect  different  energy  users  together.  SomeNmes,  that  connecNon  
will  necessarily  cross  public  right-­‐of-­‐way  (e.g.  streets)  or  pass  between  properNes  of  
mulNple,  different  owners.  When  that  happens,  depending  on  the  rules  of  the  state,  a  
microgrid  will  necessarily  handle  the  distribuNon  or  reselling  of  electricity.  In  many  ciNes,  
that  violates  the  incumbent  uNlity’s  monopoly,  or  “franchise,”  to  be  the  sole  reseller  of  
electricity  within  a  city  or  certain  territory.  

A  franchise,  in  other  words,  comes  in  two  forms:  the  uNlity’s  negoNated  agreement  with  a  
city  allowing  it  to  cross  public  rights-­‐of-­‐way,  or  its  exclusive  territory  within  a  state.  
ConnecNcut  allows  microgrids  to  bypass  the  franchise  by  explicitly  allowing  municipal  
microgrid  electric  lines  to  cross  public  rights-­‐of-­‐way  such  as  roads.76  Other  states,  such  as  
Massachuse$s,  do  not  define  the  franchise  as  being  able  to  cross  a  public  right-­‐of-­‐way.77  
Other  states  allow  third-­‐party  solar  to  sell  power  in  exclusive  territories.  

No  one,  to  date,  has  taken  a  comprehensive  look  at  franchise  rules  in  all  fiiy  states,  which  
would  say  exactly  where  and  under  what  circumstances  a  microgrid  could  operate.  

Deeply  important  in  this  discussion  is  what  defines  a  “uNlity.”  Microgrids,  by  their  funcNon,  
defy  being  labeled  a  customer,  uNlity,  or  otherwise.  But  by  being  labeled  a  uNlity,  a  
microgrid  may  be  subject  to  costly  regulaNon  by  the  state.  It  will  also  be  in  direct  conflict  
with  franchise  rules.  Third-­‐party  financing  rules  that  allow  solar  companies  to  sell  electricity  
to  customers,  thereby  sidestepping  the  franchise,  are  already  prevalent  in  at  least  26  
states.78  But  these  rules  apply  only  to  providing  power  to  a  customer  from  their  own  
property,  and  not  from  anywhere  else.  

3.  InterconnecQon  rules  
Although  microgrids  are  designed  to  island  and  work  independently  within  the  larger  grid,  
most  will  require  a  grid  connecNon.  But  most  electric  uNliNes  do  not  want  something  that  
produces  energy  they  cannot  control  or  detect.79  Moreover,  during  an  outage  in  the  larger  
grid,  a  uNlity  sees  the  microgrid’s  island  of  electricity  as  a  liability  because  line  workers  and  
civilians  may  expect  power  lines  in  that  area  to  be  dead.  Ironically,  the  key  features  of  a  
microgrid  —  reliable  power  during  a  grid  outage  and  the  ability  to  switch  between  
consumpNon  and  producNon  —  are  a  barrier  to  development.  

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The  InsNtute  of  Electrical  and  Electronics  Engineers  (IEEE)  form  all  electric  uNlity  engineering  
standards  in  the  naNon.  While  some  IEEE  standards  have  been  and  are  being  updated  to  
include  islanding  and  other  microgrid-­‐related  rules,  most  state  rules  lag  behind.80  Despite  
years  of  data  showing  safe  microgrid  operaNon  on  and  off  the  grid,  uNliNes  are  sNll  allowed  
by  most  states  to  require  costly  and  Nme-­‐consuming  interconnecNon  studies  and  limit,  
without  transparency,  the  amount  of  distributed  generaNon  on  their  power  lines.    

California  and  New  York,  again,  serve  as  examples  of  how  to  clear  the  opaque  
determinaNons  of  interconnecNon,  streamlining  applicaNon  Nmelines  while  standardizing  
interconnecNon  rules  between  all  uNliNes.  Further  limits  on  generaNon  size  can  curtail  
microgrid  size  and  the  potenNal  useful  grid  services  it  could  perform.  Freeing  the  Grid,  a  
policy  guide  from  advocacy  group  Vote  Solar,  grades  each  state  on  its  interconnecNon  
pracNces  and  provides  entry-­‐level  detail  on  interconnecNon  pracNces  across  the  naNon.81  

4.  Lack  of  a  plug-­‐and-­‐play  control  soluQon  

There’s  broad  agreement  that  most  of  the  technical  barriers  of  microgrids  are  solved,  but  
Michael  Burr  of  the  Microgrid  InsNtute  says,  “the  biggest  remaining  technical  barrier  is  the  
lack  of  affordable,  advanced  microgrid  control  systems  capable  of  managing  all  kinds  of  
microgrids  —  from  single-­‐building  nanogrids  to  large  mulN-­‐node  community  microgrids.  
There  are  many  players  in  the  market  but  few  are  offering  mature  and  flexible  microgrid  
control  soluNons.” 82  

The  microgrid  controller  at  the  Santa  Rita  Jail  is  close  to  a  plug-­‐and-­‐play  soluNon  for  
microgrids.  Yet  third  party  vendors  and  uNliNes  hesitate  to  use  something  that  they  did  not  
invent,  instead  developing  proprietary  models  that  they  control.  In  the  meanNme,  custom  
control  soluNons  easily  take  up  30  to  50  percent  of  the  microgrid  cost,  according  to  Bob  
Lassater,  a  microgrid  researcher  at  the  University  of  Wisconsin.83  Evolving  these  control  
constraints  will  free  up  capital  and  lessen  the  lengthy  Nmeline  for  developing  microgrids.  

5.  Who  pays  for  it?  (Or,  who  benefits  from  it?)  

Single  customer  microgrids  that  serve  a  single  home  or  campus  are  more  financially  certain  
because  that  one  user  (and/or  their  developer)  usually  incurs  all  the  costs  and  all  the  
benefits.  Even  so,  there  are  many  quesNons  about  potenNal  revenue  from  the  microgrid:  
• Will  the  uNlity  assess  a  standby  fee  on  the  microgrid?    
• If  uNlity  owned,  will  it  be  part  of  the  uNlity’s  rate  base?    
• What  revenue  streams  does  the  uNlity  offer  for  distributed  generaNon  (e.g.  net  metering,  
value  of  solar)?    
• What  revenue  streams  does  the  market  offer  (e.g.  voltage  control  or  frequency  
regulaNon)?  

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Microgrids  that  serve  mulNple  users  have  even  more  complexity:  
• Will  mulNple  partners  own  the  microgrid?    
• Will  the  users  be  assessed  a  separate  fee?    
• Can  people  opt  in  or  out?  
• Will  the  fee  be  per  kilowa$-­‐hour,  a  flat  fee,  or  otherwise?    

Standby  charges  and  exorbitant  exit  fees  are  among  the  two  biggest  barriers  for  microgrids.  
The  New  York  University  microgrid  currently  pays  more  than  $11  million  every  year  in  
standby  charges. 84  This  and  other  standby  charges  may  ignore  the  benefits  that  a  microgrid  
brings  to  the  larger  grid.  The  same  issue  occurs  with  exit  fees,  which  penalize  customers  that  
want  to  take  most  or  all  of  their  load  off-­‐grid.  Recently,  three  Las  Vegas  casinos  sought  to  
exit  electric  service  from  Nevada  Power,  only  to  have  the  state  uNlity  commission  find  that  
$125  million  was  necessary  to  compensate  the  uNlity  for  lost  revenue  from  expected  
electricity  sales. 85  Such  fees  are  onerous  and  discourage  clean  energy  consumpNon  or  self-­‐
supply.  

Furthermore,  retail  compensaNon  rules  need  tweaking.  Net  metering  does  not  take  into  
account  where  and  when  energy  is  most  valuable,  and  microgrids  are  uniquely  suited  to  
deliver  power  to  the  grid  in  parNcular  places  or  at  parNcular  Nmes.  DistribuNon  planning  in  
California,  for  example,  can  help  determine  a  true  Nme-­‐  and  place-­‐value  of  distributed  
energy,  such  that  fair  and  transparent  pricing  could  guide  microgrid  development.    

For  a  grid  tool  meant  to  enhance  local  control  and  reliability,  the  islandable  microgrid  can  
also  make  significant  revenue  in  the  wholesale  market,  if  there  is  such  a  market.  Depending  
on  the  market  (PJM,  MISO,  ERCOT,  etc.),  it  may  be  able  to  collect  revenue  from  demand  
response,  frequency  regulaNon,  and  other  ancillary  services  for  its  energy  storage.  Two-­‐
thirds  of  the  storage  constructed  in  2014  was  located  in  East  Coast-­‐based  PJM,  where  the  
size  entry  limits  –  100  kilowa$s  –  are  the  lowest  of  the  wholesale  markets  and  the  
compensaNon  types  the  most  robust.86  Other  markets  similarly  undervalue  storage  or  have  
no  transparent  price  at  all.  For  example,  the  Bra$le  Group  esNmates  that  30  to  40  percent  of  
the  total  system-­‐wide  benefits  of  storage  are  not  reflected  in  wholesale  prices  in  the  Texas  
market.    

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The  (Easy  or  Hard)  Way  Forward  
Will  microgrids  expand  to  their  full  potenNal?  Or  will  state,  uNlity,  and  market  rules  hold  them  
back?  

A  number  of  communiNes  not  menNoned  in  this  report  are  developing  microgrids,  tailoring  
their  potenNal  to  local  needs.  Eugene,  Ore.,  is  building  solar-­‐and-­‐storage  microgrids  at  its  
communicaNons  centers,  hoping  to  one  day  pair  community  solar  with  microgrid  technology.87    
La  Pointe,  Wisc.,  is  calling  for  proposals  to  build  a  solar-­‐and-­‐storage  microgrid  on  Madeline  
Island  in  Lake  Superior.88  The  towns  of  Potsdam,  N.Y., 89  and  Hoboken,  N.J., 90  are  both  focusing  
on  renewable  microgrids  that  will  protect  the  community  from  outages  from  extreme  weather.    

These  microgrids  promise  to  bring  much  cleaner,  local  electricity  to  these  communiNes,  and  
keep  much  more  of  the  energy  dollar  at  home.  

The  disNncNon  between  the  leading  states  and  the  laggards  is  significant.  To  illustrate  the  
difference,  ILSR  worked  with  the  Microgrid  Resources  CoaliNon  to  make  a  chart  of  microgrid  
development  in  New  York  (a  leader)  and  Minnesota  (a  laggard)  (below).  In  the  right-­‐hand  
column,  we  explain  the  opNmal  policy.  

State Barriers to Microgrid Integration: NY vs MN

Barriers  to  Microgrid   New  York1 Minnesota2 Policy  SoluNon
Development:

Yes,  NY  Prize  provides  

Is  there  state  funding   funding  for  municipal-­‐led   No,  although  there  are  a  few   Model  state  funding  
feasibility  studies,  they  need   state  incenNves  for   programs  based  off  of  the  
help? more  access  to  technical   renewable  energy. New  York  Prize  program.
resources.

New  York’s  Public  Service   Minnesota’s  Public  UNliNes  

Commission  has  determined   Commission  has  regulatory  
that  microgrids  will  be   authority  over  Public  UNliNes,  
regulated  as  electric   with  exempNons:4  
corporaNons,  with   1. A  municipality  or   Define  microgrids  in  state  
exempNons:3   cooperaNve  electric   law,  exempt  micrograms  from  
Are  microgrid  owners   1. Where  distribuNon  is   associaNon   the  statutory  definiNon  of  a  
exempt  from  regulaNon? solely  through  private   2. If  it  furnishes  its  services   public  uNlity,  and  define  how  
property   only  to  tenants  or   they  will  be  regulated
2. DistribuNon  is  from  co-­‐ cooperaNve  or  condo  
generaNon,  small  hydro,   owners.  
alternate  energy   3. If  it  produces  service  to  
producNon. less  than  25  persons.

Yes,  New  York  does  not   No,  Minnesota  assigns   Exempt  microgrids  from  the  
Are  they  exempt  from  the   designate  exclusive  service   exclusive  service  areas.  If  the   uNlity  is  exclusive  service  
areas  or  territories  and   microgrids  is  exempt  from   area.
uNlity’s  exclusive  service   allows  regional  and  local   public  uNlity  status  (serving  
are? compeNNon  with  the  default   less  than  25  persons)  this  will  
uNlity  through  Energy  Service   not  apply.
Companies.

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State Barriers to Microgrid Integration: NY vs MN
Barriers  to  Microgrid   New  York1 Minnesota2 Policy  SoluNon
Development:

Freeing  the  Grid  gives  NY  a  B   Freeing  the  Grid  gives  MN  a  C   States  should  loosen  capacity  
for  interconnecNon   for  interconnecNon   limits  on  distributed  energy,  
standards,  as  part  of  the   standards,  because  they   and  promote  transparent  
Are  they  able  to   Reforming  the  Energy  Vision   include    prohibiNve   interconnecNon  processes,  
interconnect  easily  with   (REV)  process,  these   requirements  for  addiNonal   and  use  IEEE  updates.
the  uNlity? standards  are  being   insurance  and  an  external  
reviewed.5 disconnect  switch.6

Are  there  retail  and   Under  the  REV  process,  net   No,  net  metering  is  set  at  the   Allow  micrograms  to  use  all  
wholesale  market   metering  and  distributed   retail  rate  but  limited  to  1   forms  of  distributed  
energy  compensaNon  will  be   MW  generators  for  investor-­‐ generaNon  w/o  
compensaNon  available? determined  NY  ISO  has  open   owned  uNliNes.  All  forms  of   discriminaNon  for  net  
wholesale  markets  and  will   net  metering  is  allowed.  The   metering  eligibility  or  
deliberate  how  to   Midwestern  wholesale   differing  credit  rate.
compensate  behind-­‐the-­‐ market  is  just  now  exploring  
meter  resources. compensaNon  for  behind-­‐
the-­‐meter  resources.

Other  barriers: Because  New  York  is  a   Minnesota's  verNcally-­‐

deregulated  market,   integrated  uNliNes  will  likely  
distribuNon  uNliNes  may  be   fight  any  changes  to  rules  or  
limited  in  what  distributed   laws  that  infringe  on  their  
energy  resources  they  own. incumbency.

1. Pace Energy and Climate Center & International District Energy Association. “Microgrids & District Energy:
Pathways to Sustainable Urban Development.” June 29, 2015. (Accessed February 25, 2016). http://
www.raabassociates.org/Articles/USDN%20Final%20Report.pdf.
2. Burr, Michael T. “Minnesota Microgrids: Barriers, Opportunities, and Pathways Toward Energy Assurance.”
September 30, 2013. (Accessed February 25, 2016). http://mn.gov/commerce-stat/pdfs/CHP%20pdfs/MN-
Microgrid-WP-FINAL-amended.pdf.
3. New York State Energy Research and Development Authority. “Microgrids for critical facility resiliency in New
York State.” December 2014. (Accessed February 25, 2016). https://www.nyserda.ny.gov/-/media/Files/
Publications/Research/Electic-Power-Delivery/Microgrids-for-Critical-Facility-NYS.pdf.
4. Microgrid Resources Coalition. “Summary of NY PSC REV Proceeding Recommendations.” (Accessed
February 25, 2016). http://www.microgridresources.com/data/files/Site_18/NY%20REV%20Summary.pdf.\
5. Freeing the Grid. “New York.” (Accessed February 25, 2016). http://freeingthegrid.org/#state-grades/new-york.
6. Freeing the Grid. “Minnesota.” (Accessed February 25, 2016). http://freeingthegrid.org/#state-grades/
minnesota

The  future  of  microgrids  is  about  locaNon,  locaNon,  locaNon.  Microgrids  depend  heavily  on  state  
policy  and  funding.  New  York  and  California,  for  example,  are  leading  the  way  with  numerous  
microgrid  projects.  But  the  kinks,  even  in  these  leading  states,  are  sNll  being  worked  out.  
According  to  some  California  organizaNons,  there  is  sNll  no  way  for  distributed  energy  to  be  
“plug-­‐and-­‐play,”  or  for  ciNzens  or  third  parNes  to  truly  engage  in  the  distribuNon  planning  
process.91  The  Federal  Trade  Commission,  too,  warns  New  York  that  uNliNes  will  sNll  try  to  
discriminate  or  raise  the  costs  of  third-­‐party  providers  looking  to  engage  in  power  producNon  
and  distribuNon. 92  

Page 30 of 37 Institute for Local Self-Reliance

Most  states  are  sNll  focused  on  20th  century  forms  of  grid  management,  with  monopoly  uNliNes  
only  reluctantly  allowing  independent  development  of  distributed  generaNon,  much  less  
microgrids.  Some  uNliNes  are  looking  to  control  microgrids  just  like  the  macrogrid,  and  add  
microgrids  to  their  rate  base.  

Allowing  centralized  uNlity  control  will  be  a  huge  missed  opportunity,  not  the  least  because  of  a  
history  of  uNliNes  a$empNng  to  quash  compeNNon  as  they  centralize  control.  A  microgrid  can  
integrate  high  levels  of  renewable  energy  and  offer  greater  resiliency  to  communiNes  while  
promoNng  energy  ownership,  jobs,  and  local  wealth.  It  can  give  customers  much  more  control  
over  their  energy  quality  and  costs.  It  can  add  value  to  the  electric  grid.    

One  of  the  key  issues  is  whether  microgrids  will  be  limited  to  single-­‐customer  “nanogrids"  or  
not.  Because  single-­‐building  “nanogrids”  face  less  legal  issues  from  incumbent  uNliNes  and  
regulaNons  than  community  microgrids,  they  are  becoming  more  common.  The  state  of  
Massachuse$s,  for  example,  has  given  preference  to  solar  and  storage  nanogrids  over  
microgrids  in  its  funding  for  resiliency,  since  these  systems  can  be  up  and  running  within  a  
shorter  Nme  period.    

Law  and  policy  have  thus  far  favored  non-­‐uNlity  control  of  power  generaNon  that  serves  a  single  
customer,  like  rooiop  solar.  But  there  are  (modest)  economies  of  scale  in  community-­‐scaled  
renewable  power  generaNon,  and  efficiencies  to  be  gained  by  sharing  storage  and  generaNon  
resources  across  several  customers.  A  company  with  a  flat  roof  could  provide  access  to  solar  for  
nearby  apartment  dwellers,  who  in  turn  could  provide  controllable  energy  demand  with  many  
smart  appliances  like  refrigerators.  CiNes  could  connect  many,  separately  metered  buildings  to  
have  resilient  public  spaces  in  the  face  of  natural  disaster.  A  neighborhood  of  residents  could  
aggregate  their  rooiop  solar  and  smart  appliances  to  sell  capacity  and  energy  into  markets.    

These  community  microgrids  face  several,  much  more  substanNal  barriers  than  nanogrids,  as  
they  more  closely  mimic  the  uNliNes  they  seek  to  improve  upon  or  replace.  

Microgrids  are  a  unique  and  powerful  tool  of  customer  and  community  control.  They  have  a  
strong  potenNal  for  growth  as  the  cost  of  renewable  energy  and  storage  conNnue  to  fall  rapidly,  
and  communiNes  seek  to  localize  control  of  their  energy  systems.  But  the  legacy  rules  of  the  
20th  century  grid  stand  in  the  way,  and  it’s  up  to  today’s  regulators  of  the  energy  market  to  
decide  the  future  of  microgrids  and  community  control.


Page 31 of 37 Institute for Local Self-Reliance

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