About the Working Group
This WG consists of members from industry and research institutes from several countries around the world. Multiple questionnaires and meetings were conducted, in which the members shared insights on challenges and opportunities for microgrids in their respective countries.
This white paper is based on the results of those activities and the structure is as follows: the first chapter offers an introduction to microgrids and the focus of this white paper; the second chapter identifies various functions of microgrids and barriers to their commercialization based on WG discussions and questionnaires; the third chapter provides case studies of existing microgrid pilot projects; the fourth chapter proposes some solutions for promoting microgrid commercialization; and the fifth chapter concludes the white paper.
It has been perceived among the WG members that the cost of microgrid technologies will further decrease in the next several years due to the rapid decline in the cost of renewable energy technologies and energy storage. On the other hand, commercial deployment of microgrids has struggled due to uncertainty surrounding their business models. Regulations, which were originally developed for the conventional centralized power grid, will need to be reconsidered and modified as new technologies, such as microgrids, emerge on the system. Currently, under many regulations, it is uncertain how and by whom the services and values provided by microgrids can be valuated and remunerated (e.g. through the market, electricity tariffs, etc.). Changes on the regulatory side could enable new revenue sources for microgrid businesses. If revenue sources become clearer, risks associated with microgrid projects could be reduced, facilitating financing for these projects as well. With ongoing cost reductions and changes in regulatory framework that enable microgrid business models, microgrids will shift from pilot to commercial deployment.