California plans to put $44.7 million behind the industry quest for standardized microgrid configurations, a move to drive down costs.
The California Energy Commission (CEC) will award the funds by way of a request for proposals (RFP), scheduled for July.
Because most microgrids are customized, it has been difficult for the industry to drive down costs through replication. Market watchers say that standardized microgrids will speed adoption of the technology.
The CEC will seek three types of projects through the RFP:
- Military bases, port authorities and tribal communities
- Disadvantaged communities
- Remaining market segments, such as colleges, communities, industrial complexes and rural areas
“The goal for all groups is to demonstrate a standardized microgrid configuration that can show clear cost-effective benefits and have a clear repeatable market opportunity,” said the advanced notice.
The state commission envisions awarding $2 million to $5 million per project. In addition to standardization, the commission seeks projects that are cost-effective and offer “a clear repeatable market opportunity,” said the CEC notice.
The projects must be located within electric investor-owned utility (IOU) territories. Bidders should demonstrate measurable benefits and a high probability of commercial success.
The CEC prefers projects that are modular and offer operational benefits and a definable value for the customer.
Projects must have community support and show that they can meet permitting and utility interconnection requirements within the proposed timeline.
The CEC also requires that winners provide 20 percent in matching funds. The state will give priority to those that have a plan to leverage other sources of funding, as well.
For example, the notice said that a military base may have access to federal Department of Defense funding for base energy resiliency upgrades. Port authorities may be able to leverage internal funding, grants, bonds and federal funding. Tribal communities could use special government funds. Special state initiatives, such as California’s cap-and-trade program, as well as grants and federal sources, might offer an additional funding source for disadvantaged communities.
Applications will be due about three months after the CEC issues the solicitation. Before the due date, the CEC will hold workshops for bidders in northern and southern California.
California is one of a growing number of states that have been offering funds to encourage microgrid development. Others include Connecticut, Massachusetts, New Jersey, New York and Washington.
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