Home Renewable Energy R&D Due to the Diversity of Segments, the Business Case for Microgrids Continues to Evolve
Due to the Diversity of Segments, the Business Case for Microgrids Continues to Evolve

Due to the Diversity of Segments, the Business Case for Microgrids Continues to Evolve


A new report from Navigant Research analyzes 10 emerging business models for the microgrid market, providing insight on the strategies, maturity, and financial opportunities attached to each development pathway.Microgrids have the ability to play a role in realizing greater utilization of existing generation and resources by enabling networking and sharing of resources to match loads. Yet, resiliency services enabled by technology are not free, and each microgrid segment leans toward a different business model. Click to tweet: According to a new report from Navigant Research, the modularity and highly variable configurations of microgrids make calculating an overall return on investment for all microgrids virtually impossible, and as a result, the business cases for microgrids to continue to evolve.

“There is no single dominant microgrid business model, given the diversity of application segments and regulatory landscapes in different regions of the world,” says Peter Asmus, principal research analyst with Navigant Research. “Yet changes in the marketplace, including the Power Purchase Agreement (PPA) and the prevalence of software as a service, are pointing in the direction of a few models as likely to become more common over time.”The majority of the microgrids operating today have been pilot projects or experiments, and the industry is now moving into the next phase of project development. According to the report, the key to future growth rests with greater flexibility in regulation and public policy that, in turn, are spawning business model innovation from market players both large and small.

The report, Emerging Microgrid Business Models, examines the latest thinking among utilities, technology vendors, and regulators about emerging business models that can take the global microgrid market to the next level. The study explores 10 different business models being applied to this market today. It also provides an analysis of how different microgrid market segments gravitate toward different development strategies that reflect preferred resource mixes, existing contracting vehicles, and lessons learned from adjacent markets such as solar PV and energy storage. Tables included in the report highlight which of these models are being applied to different microgrid markets, as well as the relative maturity and financial opportunity attached to each development pathway.


Anand Gupta Editor - EQ Int'l Media Network


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