Microgrids are integrated systems of on-site energy infrastructure that use advanced controls to optimize distributed energy resources (DERs) such as solar arrays, battery storage, and/or dispatchable generation. 

Their operations can be integrated with a utility grid connection if one is available, while retaining the ability to operate independently from the grid in case of a utility outage. Microgrids can also provide a completely self-sufficient off-grid source of power for facilities that currently lack a grid connection, while retaining the ability to integrate with utility service if and when it becomes available.  

How do microgrids work? 

Microgrids use on-site DERs to provide power to a facility or facilities in a given area. Typically, microgrids operate in tandem with the utility grid, with advanced controls optimizing the use of energy from each resource to minimize energy costs and emissions. If the utility grid goes down, microgrids can automatically isolate (or “island”) from the grid and rely on on-site resources to keep critical operations running.

 

Microgrids can provide several valuable advantages compared to relying exclusively on the utility grid, including cost savings, enhanced resilience, and improved sustainability performance. A growing number of businesses are also turning to microgrids to provide power supplies (or additional capacity) for facilities sooner and at a lower cost than waiting for utility service or capacity upgrades.

 

 

Project timelines vary based on the size and complexity of a project. The entire process – including energy and site analysis, project planning and design, contracting, and engineering, procurement, and construction – typically takes from 12-18 months 

 

a. Scale typically offers to design and build microgrids using the capital sale or “energy-as-a-service” models. Under the capital sale option, the microgrid typically costs between $1,000 - $2,500 per kW installed depending on which DERs are used and in what quantities. Higher Capex budgets usually result in lower Opex. Typical payback periods range from 5 - 8 years on a 25-year system life. 

 

b. In the “energy-as-a-service” model, Scale uses a Microgrid Services Agreement (MSA) to provide the capital stack through leveraging tax credits, incentives, and our own capital to offer a $0 down services agreement. Customers save money through utility savings in the first year of operations and continue to accrue savings for the life of the project.

 

 

At Scale we often describe backup generators as “cost centers” while microgrids are “profit centers.” Backup generators are simply an added expense to install and operate, and, while they provide valuable resilience on the occasions when they’re needed, they offer no benefits the rest of the year. By contrast, microgrids can provide similar or even superior resilience benefits, as they can include multiple on-site resources like solar and storage in addition to dispatchable generators – and when they aren’t needed for resilience, they can deliver cost savings as described above. 

 

 

The modular architecture of microgrids offers a flexible platform for additional energy upgrades down the road, enabling businesses to further augment on-site power capacity with additional solar, storage, or generating assets as needed. This is becoming an increasingly valuable advantage as electric utilities in many areas struggle to keep up with accelerating demand for power, leading to yearslong wait times for costly service capacity expansions. Microgrids can also incorporate temporary generators in the short term or take a portion of site load off-grid until utility service is available, offering additional options for rapidly expanding the power capacity of a site.   

 

Microgrid emission reductions depend on what types of on-site resources are deployed and what portion of a site’s load they can cover. Microgrids that use solely zero-emission resources like solar, battery storage, and/or emerging dispatchable fuels like green hydrogen can reduce a facility’s emissions by 100%. However, it is much more common for microgrids to only cover a portion of a site’s load, and zero-emission dispatchable generation fuels are still rarely used today due to high costs and a lack of widespread availability. Still, it is common for microgrids incorporating solar and storage to reduce emissions by 30% or more.   

 

 

Here again, microgrid backup capabilities depend on a customer’s needs and the on-site resources that are deployed. Microgrids relying exclusively on solar and battery storage assets can typically provide anywhere from 2 to 12 hours of zero-emission backup power, depending on the size of the system. When dispatchable generators are included, a microgrid can provide uninterrupted 24/7 backup power as long as fuel is available. 

 

Yes, Scale offers comprehensive asset management services for our microgrids, with 24/7/365 remote monitoring, sensing, and real time alerts. Scale’s network of technicians provides preventative and proactive maintenance, equipment replacements, and subject matter experts in key hubs that respond to more challenging issues on demand. Scale’s warranty covers the lifetime of the agreement under the MSA structure.

 

 

No. For microgrids purchased under a Microgrid Services Agreement (MSA), all operations, maintenance, ongoing optimization, and asset management are included in the annual fee.