Worldwide vendor revenues from microgrids are set to grow from $4.3 billion in 2013 to $19.9 billion in 2020, according to a new study from Navigant Research.
With the industry now focusing on how to develop projects on commercially viable terms, annual revenues could even reach $36.2 billion by the end of the forecast period under a more aggressive scenario modeled by Navigant Research.
“Microgrids are inching their way into the mainstream, with the focus of the market shifting from technology validation to questions surrounding the most promising business models,” said Peter Asmus, principal research analyst with Navigant Research. “The number of companies active in the space, and the range of applications of microgrids, are growing exponentially, yet there is little consensus on the pace of development in the coming years.”
Navigant Research says it has become evident that today’s “modern, digital economy” needs a more advanced and responsive power grid framework than the one currently in existence.
That need is especially pronounced in the US, say the study’s authors, with statistics compiled by Lawrence Berkeley National Laboratory showing that between 80% and 90% of all grid failures begin at the distribution level of electricity service.
The distribution level is the portion of the power system where microgrids operate, notes the report, “bolstering reliability from the bottom up, rather than from the top down”.