The microgrid market is expected to expand rapidly over the next 10 years, bringing with it increased demand for energy storage associated with these systems. Energy storage systems (ESSs) deliver services to microgrids similar to the services that ESSs deliver to the traditional grid: resource optimization (fuel, solar photovoltaic, wind), resource integration (photovoltaic, wind), stability (frequency, voltage), and load management. According to a new report from Navigant Research, the total worldwide capacity of ESSs for microgrids will grow from 817 megawatt-hours (MWh) in 2014 to 15,182MWh by 2024.
"The primary value proposition of energy storage in a microgrid is in improving the payback period of the system, either by enabling an increase in the penetration of renewable energy sources, allowing participation in deregulated ancillary service markets, or reducing diesel fuel consumption," said Anissa Dehamna, senior research analyst with Navigant Research. "High prices for diesel fuel, a stronger push for the utilization of renewable resources in microgrids, and ancillary service market reforms will all underscore the business case for energy storage for microgrids."
Advanced batteries and, in some cases, flywheels will take progressively more market share from traditional lead-acid batteries as microgrid systems become more sophisticated and demanding. A 15% displacement of diesel generator sets in a remote microgrid would result in a payback period of 2-4 years across all energy storage technologies. The key for energy storage vendors is to find the right business models, partners, and demonstrate the longevity and robustness required of remote systems, the firm said.
