In the wake of the crippling blackouts that South Australia experienced in 2016, Business South Australia reported a $367 million cost to industry, with 850,000 people affected.

New South Wales, in the midst of a heatwave last year, was forced to order the Tomago aluminium smelter shutdown in order to stabilise the grid.

These incidents highlight the dependence of industry on our national grid infrastructure, and with the threat of increasing extreme weather events, such as storms and heatwaves, as well as increasing demand from technology, companies are searching for a better solution.

While first instinct is often to think bigger, the answer for energy stability and efficiency actually lies in thinking much smaller. Microgrids – small scale electricity networks – have been increasingly popping up in remote communities and modern skyscrapers, and offer the opportunity of reduced grid dependency and greater energy resiliency.

What is a microgrid?

A microgrid is a local electrical distribution system with controlled loads and distributed energy resources that operate in a coordinated way to provide one or more of the following capabilities: to manage energy consumption on site, to provide services to the grid, and/or to increase the resiliency of the network.

A successful microgrid contains an integrated automation system, which enables smart microgrid control; energy use optimisation; power and heat demand response and energy storage. This intelligent grid often capitalises on green energies, such as solar, wind and batteries.

The building management opportunity

Microgrids, aggregating diverse low-carbon resources, can provide cheap, clean, reliable power to those within it. Consequently, this is an increasingly attractive option when retrofitting buildings.

  • The technology costs, like batteries, decline and savings on operational expenses are realised because facilities are protected from the risk and changing cost components of an ever-evolving energy market.
  • The energy supply reliability is greater. For example, in the case of a natural disaster such as a storm, bushfire or heatwave, a microgrid can protect a building from the effects of market demand spikes.
  • Microgrids are a green solution which place businesses at the forefront of sustainable practice.

In Finland, global discount supermarket chain Lidl is constructing a world first distribution centre operating on 100 per cent renewable energy. A smart microgrid control solution will be used to monitor and control the building and is expected to provide energy savings of over 50 per cent.

The future of microgrids

Looking to the future, a web of microgrids across a city can support the wider network of energy supply. At times of peak demand, utilities can call on electricity stored in microgrids’ batteries or use their generators to provide a boost of power. If this happens, these hybrid microgrids will make the existing grid far more resilient.

In Australia, microgrids are quickly growing in popularity and are an effective way of maintaining independence from a volatile energy sector.