Steve Hoffman, president and CEO of Hoffman Power Consulting, discusses how empowered counties, frazzled citizens and businesses with a distributed workforce are emerging from the pandemic – seeking resilience.
A new age
We have now entered the Age of Extremes.
Even before the 2020 hurricane and wildfire seasons, 87% of respondents in a May 2020 Accenture survey of 200 utility executives said they are experiencing increasing severe weather events in their own regions. Then 2020 broke the record for the most named storms in an Atlantic hurricane season, including 13 hurricanes and six major ones. Over 4 million acres burned in California alone – more than doubling the previous all-time annual record. At the same time, the pandemic complicated evacuations and firefighting activities. Other extreme events included tornadoes, floods, extreme heat waves and polar vortexes. If your area avoided all of these extremes last year, you were fortunate.
Counties take the microgrid stage
What does this mean for microgrids? One clear trend has emerged: US counties are taking center stage. As counties assumed leadership roles in addressing COVID-19, they became the primary decision makers and responsible parties in many areas of the country. According to the National Association of Counties (NACo), as early as April 15, 2020, 864 US counties declared an emergency and 169 additional counties issued “shelter-in-place” or business closure policies (see the NACo map), while many imposed temporary curfews. This represents about one-third of the more than 3,000 total US counties. These policies were independent of state-level mandates.
Not surprisingly, county microgrid activities are increasing. The County of Humboldt (California) is a key project participant in the Redwood Coast Airport Renewable Energy Microgrid – the first multicustomer microgrid in Northern California. Proposed legislation now pending in Ohio would give Cuyahoga County the authority to establish a public utility and build various microgrids. The county views microgrids as a means to attract new business and innovation. Camden County (New Jersey) is also planning a microgrid. These pioneers follow early microgrid adopter Montgomery County (Maryland), which implemented two microgrid projects in 2018.
Counties are flexing their muscles in the regulatory arena as well. In the August 2020 comments on California Public Utility Commission (CPUC) staff proposals, the Local Government Sustainable Energy Coalition objected to utility construction of 15 pilot microgrids. This coalition, which includes 23 California counties, encouraged regulators to give local communities control of the administration and funding of the microgrid program. While the CPUC did not give control of the $200 million program to localities, it did order utilities to develop microgrids tariffs and to revise their rules to allow local government to serve critical customers on parcels adjacent to government property.
A frazzled public and redefined workplace
COVID-19’s role in the Age of Extremes has increased public awareness of the need for preparedness and response to extreme events – and increased their impatience with electrical service disruptions. Many consumers were frustrated with the unavailability of basic consumer goods during the pandemic. Consider how these consumers would react to loss of electricity for an extended period of time, especially if they are working from home (telecommuting).
As the effects of the pandemic ease, the shift to telecommuting is becoming a permanent option for many workers. This means the home now plays an even more central role in the lives of electricity customers – it’s also a workplace. And most home-based employees face increased utility costs – to pay for an estimated 3,000 more kilowatt-hours annually – and decreased reliability and resilience.
Businesses that employ these home workers have scaled back their centralized operations and associated costs. Hence, investing in the resilience of their local community – where their workers are – makes good business sense. A microgrid serving one business, campus or building may enhance resilience less effectively than before the pandemic. Conversely, community microgrids can better support business continuity with reliable, resilient, decentralized electricity for a distributed workforce.
Businesses should also consider helping employees create a single-residence “nanogrid” to become more resilient. Plug and play microgrids with mass produced parts compatible with multiple platforms could bring the cost of a nanogrid within the range of more home-based employees, especially with employer support. While battery costs are high, an electric vehicle in the garage could reduce the amount of required stand-alone battery capacity. Also, affordability would improve if a single-home nanogrid were capable of selling excess power back to the main grid (or providing ancillary services to the grid when aggregated into a virtual power plant).
What does it all mean?
Extreme weather, wildfires and a pandemic portend a fundamental shift in the microgrid landscape. To date, the motivation for microgrids originated primarily from businesses to enhance reliability for their centralized workforces, from college campuses, and from military bases. Moving forward, counties and businesses will increasingly drive microgrids. Counties will see microgrids as a way to enhance community resilience and protect their citizens from extreme events and situations. Businesses will shift their emphasis from single-site reliability to enhanced resilience for their distributed workforces. These new roles will accelerate recognition that microgrids are the key resilience solution in the Age of Extremes.