I’ve been covering energy for a long time, and every so often, a piece of research comes along that deserves more attention than it’s likely to get. Last week, that happened.
A new report from the Schneider Electric Research Institute finally puts hard numbers on something hinted at for years but never quantified this way: microgrids are giving grid operators a freebie. The data warrants a new look at the math for capacity planning and energy forecasts, particularly in communities where microgrids are many — or can be.
The concept is called “headroom.” When a commercial building installs rooftop solar and a battery to cut its own energy costs, it inadvertently flattens its load profile and frees up grid capacity.
The Schneider researchers modeled 65 use cases across hospitals, schools, offices, hotels, and strip malls in 13 geographies — and found that, in the best scenarios, microgrids recovered up to 60% of a site’s grid power limit — all at zero marginal cost to the grid operator. If it’s your job to consider how much new infrastructure we need to meet surging peak demand, that number should give you pause, especially in an era where microgrids are getting bigger.
What I find most interesting is that none of this relief is intentional. The building owner isn’t trying to help the grid — they’re trying to gain resilience, sustainability or cost savings. The grid benefit is purely a byproduct.
That means grid operators and planners who aren’t accounting for distributed energy in their capacity forecasts may be overestimating grid needs. Nobody asked private investors to fix the grid’s capacity problem. The right price signals did that on their own.
The researchers examined headroom in several countries. The numbers are better in some countries than others, largely depending on utility tariff structures.
Where pricing rewards demand reduction — demand charges in the US and Canada, subscribed power penalties in France and Spain — the headroom shows up reliably. When those signals are weak, the benefit diminishes.
To me, the findings reopen the discussion about how to pay microgrids for the work they do. We already know they help ensure electric reliability — a benefit that utilities are supposed to guarantee, but the bill is often footed by private businesses and communities that install microgrids. Now we see that microgrids provide another benefit besides resilience — grid headroom — that goes unmonetized.
I dove into this research with Vincent Petit, the institute’s senior vice president of climate and energy transition research. Listen to the podcast here or read more on Microgrids Now.
