The market for microgrids is growing, with over 400 projects currently underway, and more on the way. This growth has been influenced by several different factors including climate, size, and security concerns.

Two new reports from Navigant Research reveal more than 400 individual projects are currently in operation or under development worldwide, and forecast the global  market will pass $40 billion in annual revenue by 2020.

Microgrids have traditionally been a mainstay of campus-sized institutions like industrial parks or colleges, but that paradigm is shifting as the US military works to reduce climate risks and improve fuel security while local governments plan for resiliency in the face of climate change-fueled severe weather.

Navigant broadly cites the US Department of Energy’s definition of microgrids as interconnected demand and generation with defined boundaries that can either connect or disconnect from the grid to keep the lights on at any time. This definition is expanded in their research to include remote microgrids, or those operating in “island mode” for a majority of the time.

Using these guidelines, the Microgrid Deployment Tracker 4Q12 identifies at least 405 projects currently planned, proposed, under development, or fully operating. These projects represent 3.2 gigawatts (GW) total capacity, up from 2.6GW in 2Q 2012. 67 new project entries representing 571 megawatts (MW) of new capacity are noted across that time frame, a 22% jump in just six months.

North America dominates the global market with a majority of overall market share and 2GW total capacity, followed by Europe at 384MW and the Asia-Pacific region with 303MW.

With weather becoming more extreme, fuel prices getting higher, and the large-scale energy distribution infrastructure aging, microgrids are becoming more relevant and sought after. In addition, as we continue to move toward using more renewable energy sources, microgrids will provide the technology and meet the demand required of multiple and variable energy sources at one time without overloading the power grid.

“Microgrids can provide a quality and diversity of services that incumbent utilities have been unable to match,” said Peter Asmus, Navigant’s principal research analyst. “Extreme weather events and growing recognition of microgrids as potential sources of demand response are building engineering and cultural support.”

To read more, head over to Clean Technica.

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