Recent reports released by Navigant Research predict that the annual revenue of the global energy market could exceed $40 billion by 2020, thanks to the 400 individual projects currently running or under development.
A key factor that will determine the growth of the industry is the microgrids. Initially, these have been popular only within small institutions, however their potential to provide reliable green energy is now making them very attractive to numerous ongoing energy projects.
Microgrids, as defined by the US Department of Energy, are essentially interconnected demand and generation with certain boundaries. They can be connected or disconnected from the main grid at any given time, allowing constant supply of energy. Navigant Research adds to this by including the so-called ‘remote microgrids’, which operate in ‘island mode’ most of the time.
The report entitled “Microgrid Deployment Tracker 4Q12” states that currently there are more than 405 ongoing projects, which represent around 3.2 gigawatts of total capacity. In addition, there are 67 new projects that could add 571 megawatts of capacity. The leader in microgrid capacity by region is clearly North America with a total of 2GW, followed by Europe (384MW) and Asia-Pacific (303MW).
Currently, microgrids use existing generation and demand, and only introduce improved technologies, however Navigant expects that most of the new projects will incorporate distributed generation and energy storage from cheap renewable sources.
The report also points out that microgrids are becoming increasingly popular when it comes to finding better ways to battle extreme weather conditions. This is particularly the case with military projects, where the US Department of Defense has the largest increase in microgrid capacity.
Navigant predictions indicate that the annual revenue from microgrid projects will increase from $8.3 billion in 2013 to the $40 billion in 2020.
Considering that extreme weather events and natural disasters are predicted to become more apparent and regular, Navigant points out that microgrids can provide the ever-so-needed resilient infrastructure.