Cost-effective electric power has been a challenge for communities and industrial or commercial installations without access to a strong utility grid. They have had to rely on engine- or turbine-driven generator sets that, while highly reliable, typically produce power at a much higher cost than a large utility.
Now a better model is emerging that combines newly cost-effective renewable energy from wind or solar sources with conventional diesel- or gas-fueled generation. These installations, called hybrid microgrids, also employ energy storage to add power system stability and enable further energy cost reduction.
Aided by sharp declines in the cost of wind and solar energy, as well as lower energy storage costs relative to the price of fuel, hybrid microgrids are well suited to a host of applications, including individual buildings, resorts, mine sites, remote villages, small islands and others. The most promising applications are those with total power demand from 100 kW to 20 MW.