Why more manufacturers are turning to microgrids
Microgrids mitigate power distribution vulnerabilities
North America has now deployed more microgrids than any other region in the world, and manufacturers are a leading adopter of the technology. As more manufacturing facilities look to rely less on the power grid and integrate renewable energy into their operations, microgrids and backup power are becoming increasingly popular.
According to Microgrid Knowledge and data from Navigant, “commercial and industrial (C&I) microgrids are poised to grow faster than any other form of microgrid, as data centers, stores, resorts, manufacturers and other business operations turn to the technology.”
Manufacturers face a great many challenges: obligations to customers, planning for infrastructure repairs and upgrades, maintaining a healthy workplace and meeting environmental goals. In addition, they also face a new set of issues that have recently emerged. These include:
- Constraints due to the COVID-19 pandemic
- Tariffs stemming from international trade disputes
- Environmental, social and governance (ESG) issues important to investors
- Power failures due to poor weather, accidents, equipment malfunctions or other causes.
An analysis of national power outage data from Climate Central shows that there has been a 67% increase in major power outages from weather-related events since 2000. Two-thirds of states experienced an increase in outages caused by extreme weather in recent years.
Power disruptions have a significant impact on manufacturers. Even small fluctuations in power quality can disrupt assembly lines and cause costly delays. An increased use of automated assembly technology, use of artificial intelligence (AI) and use of 3D printing technologies make resilient, reliable power increasingly important. A recent survey found that more than a quarter of manufacturing businesses experienced an outage at least once a month, and 58% reported an outage lasting longer than one hour.
For large manufacturing enterprises, cost of a single hour of downtime can easily top the $5 million mark. These disruptions have a ripple effect beyond the factory and can even affect supply chain logistics and businesses that rely on real-time delivery of products.
Manufacturers must address all of these challenges while delivering on the constant expectation to lower costs across the business year over year.
Microgrids offer manufacturers a flexible platform to head off these issues — ensuring power is reliable, enabling renewable energy for sustainability goals, controlling energy costs and attracting customers and investors that want manufacturers to continuously raising the bar on ESG performance. A microgrid can help control energy generation, usage and cost stability.
A microgrid meets needs
The are many options available to configure the best microsystem for an organization. Some of the best-known components are:
Photovoltaic (PV) solar arrays, which can be built onto existing roofs, structures or ground-mounted frames and tied into AC inverters, batteries and other electrical infrastructure comprising a microgrid. The power generated from the panels can be channeled and stored into energy storage battery banks or incorporated with other power sources like generators and wind power via inverters that change dc to ac voltage.
When a grid outage occurs, a facility can operate without the grid, using the solar generation to power operations during the day, and store excess energy in batteries to continue into nighttime. Solar plus energy storage microgrid can provide cost savings when the grid is operating on-peak by shifting load to electricity stored during less expensive, off-peak hours.
Solar parking canopies: While covered parking provides vehicles protection from the elements, it can also be an overlooked area for onsite renewable power generation.
Onsite wind generation: Wind generation can be coupled with a battery energy storage system (BESS) to provide a robust onsite option for power generation — and an important contributor that helps organizations meet their sustainability goals.
Battery storage and UPS: A battery energy storage system (BESS) stores energy through battery technology. It can be a critical component in the microgrid system by acting as an energy buffer when intermittent renewable electricity generation creates new demands on the grid.
Main battery storage coupled with an uninterruptible power supply (UPS) system can be used to provide sensitive computer controls and data center servers with the proper stable backup voltage and protection to keep IT and control system operations online.
Backup power generators: Conventional generator systems can provide reliable backup power during unplanned outages. Generators can be combined with energy storage and on-site renewable energy to provide a comprehensive microgrid solution.
Fuel cells: If someone’s manufacturing operations have dependable access to natural gas, biogas or hydrogen, fuel cells are a great option. Fuel cells can supply continuous power when wind, solar, batteries or other resources are unavailable.
In addition, fuel cells generate about half of the greenhouse gas emissions of centralized power and release virtually almost no carbon monoxide, lead, ground-level ozone, particulate matter, nitrogen dioxide and sulfur dioxide, the six most common sources of air pollution. They also offer a high degree of cost predictability, making it possible to lock in long-term power costs instead of facing yearly utility rate uncertainty and increases.
Microgrid controls: Operation of the microgrid needs to be adaptable, depending on the power supply from the grid, time-of-use rates, demand response agreements with the local utility and arbitrage where a deregulated market exists for selling off excess power.
A robust microgrid controls system will handle conditions in near real-time response and provide the required flexibility to accommodate dynamic optimization strategies as well as grow and change with future growth and power options.
The bottom line
Microgrids can help manufacturers meet many of the challenges they face today.
A well-designed microgrid can bring efficient, low-cost power as well as reliability and resiliency benefits to critical infrastructure. A microgrid with robust controls and up-to-date cybersecurity supports operational flexibility while providing predictable costs optimized for both efficiency and sustainability.
An investment in a microgrid can act as insurance for continued growth, success and innovation. A power disruption brings vulnerability, loss of time and money — a microgrid puts you back in charge.