All IDCA News

By Loading

9 Feb 2023

Share on social media:

Data Centers Can Benefit from Projected Growth in Microgrid Development

Microgrids in the US will grow at an average rate of 19% per year through the year 2027, according to Elham Akhavan, a senior research analyst at Wood Mackenzie. This would bring their installed power to around 17GW, representing about 1.5% of the current total electrical power availability in the US.

The largest microgrids of 20 to 30MW can be of use to data centers as supplements, backups, and even primary power if edge centers with relatively small footprints emerge to serve local IoT deployments and other deployments requiring very low latency.

A recent report from ESG Impact Zone, an IDCA Smart Nations media partner, says the microgrid industry has adopted new business models that shift upfront costs away from the end user, thus making microgrids an increasingly popular option for green initiatives and entities trying to navigate electricity outages. The report notes that approximately 7% of recent renewable generation deployed in the U.S. was associated with a microgrid, well above the proportion of microgrids in the overall electricity grids.

Get Ready for Microgrid-as-a-Service
Another key development is the idea of microgrid-as-a-service, which shifts the cost burden from customers to companies providing the service. This trend is already showing up in industry statistics. As Akhavan notes, of microgrids that serve consumers and businesses rather than utilities directly, “the share of end-user ownership dropped 31% from 2019 to 2022, while microgrid-as-a-service grew 25%.”

One of the key benefits of microgrids is that they improve electric reliability and resilience at a time when electricity outages are increasing, according to the ESG Impact Zone report. The risks and costs associated with outages are one of the reasons why the commercial and industrial sector made up 48% of the microgrid customer segment in 2022, the report states.

Akhavan predicts that the Inflation Reduction Act may aid microgrid development, as within its $369 billion for energy and climate spending are incentives for renewable energy sources that can be integrated into microgrids.

This post is accompanie by a rendering from ESG Impact Zone of the New JFK Terminal One. Plans call for an 11.4MW microgrid to supply its power.

Follow us on social media: