Integration beats islanding, anyway you slice it.
Steve Huntoon is the principal of Energy Counsel, LLP, www.energy-counsel.com. Mr. Huntoon is a former President of the Energy Bar Association, and for over 30 years of practice in energy regulatory law he has advised and represented such companies and institutions as Dynegy, PECO Energy (now part of Exelon), Florida Power & Light (NextEra Energy), ISO New England, Entergy, PacifiCorp, Williston Basin (MDU Resources), and Conectiv (PHI).
A microgrid is to the grid as a microturbine is to a turbine. Nothing more.
Remember the Capstone microturbine? It was going to revolutionize the power industry. Every commercial and small industrial customer was going to want one. Capstone stock exploded in the wake of the Enron crisis, peaking at $98/share in 2000. Then it collapsed to $1/share two years later, when the anticipated market failed to materialize.
But some memories go back even further. So let's begin with some ancient history.
A microgrid marks a throwback to the turn of the last century. Yes, I'm talking about 1900, when cities were marked by many "microgrids" - what we might think of as islands of tiny utilities. Philadelphia stands as an apt example. According to Nicholas Wainwright's "History of the Philadelphia Electric Company," the city back in 1895 could claim more than 20 electric companies providing service.
Then came Samuel Insull, who instilled a new vision of the regulated franchised utility, and we got rid of that island model because it made no sense. Industry leaders discovered the enormous scale economies hidden in the transmission and distribution of electricity, and the enormous efficiencies to be had from interconnected generation, to allow the least-cost sources of electrons and ancillary services to run every hour, every day, and every week of the year. The secret was out - reliability through diversity.