Interest in home microgrids is surging in California in response to wildfires and public safety power shutoffs (PSPS), with microgrid companies saying demand has jumped by as much as 1,000% in the last month.
Not only has demand increased; so has the pressure to install home microgrids as quickly as possible, and some companies say they can’t move quickly enough to satisfy customers’ requests.
“People want it now. In our latest project, they want us to start construction this year and it’s not going to happen,” said Gary Oppedahl, vice president, emerging technology for Emera Technologies.
Emera Technologies, a subsidiary of Canadian utility Emera, is experiencing “huge” demand in California, he said. The state was not originally on its list of markets, but is now on the company’s radar because demand is so high. “Without us having any advertising out there, we’ve been getting at least a call a week since March or April with opportunities in California.”
The company provides microgrids for neighborhoods made up of 50 to 75 homes, and generally works with real estate developers doing new construction, which is the most cost-effective way to provide the microgrids. But some potential customers have contacted Emera Technologies about retrofitting communities. And utilities have reached out to the company, as well, he said
Demand through the chimney
“Utilities want local solutions in California and other markets where you have the resilience story. We are hearing from them much more than we would have expected,” said Oppedahl.
In Emera Technologies’ case, utilities, independent power producers or community choice aggregations generally own the systems.
Arnold Leitner, CEO, YouSolar, said his company is also fielding calls from California, and hasn’t done any advertising. “Demand was through the roof before and now it’s through the chimney. We are hearing from frustrated customers in California.” The company sells the PowerBloc, a plug and play microgrid.
For Instant On, demand for home microgrids has surged by 1,000% in the last month, said AJ Perkins, president. “We have people calling from all across the country for home nanogrids and microgrids for businesses, but 90% of these calls are definitely focused on the West Coast.” He has also seen an uptick in customers asking about microgrids with solar and fuel cells, which provide redundancy when smoke undermines the production of solar in California.
Commercial operations such as wineries are also looking for microgrids — and are offering to pay high price tags.
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Blue Planet Energy Systems this week drafted business contingency plans for a winery operation. One was for continued harvest and processing during a utility PSPS, and a second one addressed outages or imminent fire presence that would threaten the quality of the wine stored in the cellar. The work would come with a seven figure price tag, said Olar Lohr, regional sales manager, Blue Planet Energy.
“The wildfires are the ‘hurricanes of California.’ They will come back every year. It is unclear where and when, but our customers are planning for the new normal.” Incentives and very high electric rates bolster the argument for immediate action and justify microgrid planning, said Lohr.
And OhmConnect quadrupled the number of new customers during the mid-August heatwaves, said Cisco DeVries, company president. The customers get paid for OhmConnect to control their appliances or home microgrids for load management or to provide power to utilities.
What’s the utility role?
Some of the microgrid companies say that utilities should be paying for home microgrids or communities of home microgrids.
That’s generally the model that Emera Technologies uses in areas outside of California, including Florida, which is being hit by hurricanes.
“We’re hearing in regulated markets that microgrids provide a big benefit. Our system allows the utilities to manage and bring in a higher amount of renewable energy to their portfolios in a distributed platform,” said Oppedahl.
However, in California, due to its deregulated structure, there are challenges to utilities owning the systems, he said. Utilities aren’t allowed to own distribution and generation. Emera Technologies is trying to work with community choice aggregations and cooperatives, which are permitted to own the systems.
“The utilities are spending a lot of money to serve just a few customers, when microgrids would make more sense.” — Arnold Leitner, YouSolar
The move toward microgrids can create a business challenge for utilities. If a whole community were retrofitted with microgrids, the utility would earn less revenue, and it’s possible that utility infrastructure would be viewed as a stranded asset, said Oppedahl.
YouSolar’s Leitner advocates utilities owning microgrid systems. For example, they can be a good alternative to wires that serve small numbers of people in far-flung areas at high costs.
“During fires, all the power lines need to be shut down. When it comes back on line, utilities need to fly helicopters over these areas to serve just a small number of customers.” The utilities are spending a lot of money to serve just a few customers, when microgrids would make more sense, he said
“What if we started rethinking: Maybe those customers should be supplied with microgrids paid for by Pacific Gas & Electric,” Leitner said.
His company, YouSolar, began with a crowdfunding campaign, which was oversubscribed and recently closed $1.07 million of equity crowdfunding. YouSolar now has a pipeline of more than 500 new customers in the US. About 70 investors signed up to become customers, he noted.
Hurricanes and home microgrids
The demand for home microgrids isn’t only coming from California, said Oppedahl. Emera Technologies also works in Florida, which has been affected by hurricanes.
“Every time there is a natural disaster, people start thinking about how we can have a different approach. They then think of microgrids, local generation and local distribution. There’s a lot of pressure to have resilience built into communities,” he said.
Shuli Goodman, executive director of LF Energy, a nonprofit organization tasked with solving the climate crisis through the use of open source technology, said that the technology for home microgrids has matured so that early adopters are taking advantage of it.
The early adopters will help move the market forward, said Goodman. “This will drive costs lower and make them more accessible to homeowners seeking to harden themselves to power outages. We are at the very beginning of a profound innovation surge. We can assume there will be dramatic cost decreases driven by commodity hardware that will be networked and controlled by software that will be 80-90% open source.”
Read more about home microgrids in the Microgrid Knowledge special report, “Nanogrids: A New Opportunity for the Solar Industry,” downloadable free of charge, courtesy of Instant On.