Examining Barriers to Microgrids in California

In an article for Utility Dive, Guidehouse says 2020’s wildfires demonstrate a need for microgrids, but regulatory hurdles continue to hamper deployments

As climate change drives more extreme weather events, wildfires in California and throughout the West are becoming the norm. Microgrids offer the potential to increase resiliency, but a series of regulatory barriers for both utilities and third-party vendors remains.

In an article for Utility Dive, Peter Asmus, research director with Guidehouse Insights examined applications for microgrids in California, as well as considerations that help and hinder microgrid deployments. He also shared insights from interviews with with Pacific Gas & Electric (PG&E) and the City of Berkeley and status updates on regulatory initiatives.

“Unfortunately, the pandemic’s onset hampered the state’s efforts to fight a record-setting wildfire season in 2020 with an aggressive microgrid policy initiative as well as plans that would have been the largest single utility microgrid purchase program in the country,” Asmus said.

Asmus added that microgrids are proliferating, with 8,203 microgrids identified worldwide representing 36,700 MW of peak capacity, according to Guidehouse Insights’ Microgrid Deployment Tracker 1Q21

Asmus concluded that utilities and third-party developers – and their customers – are signaling that reforms are needed to existing policy and regulations to accommodate the rapid change sweeping through electricity markets. 

“Microgrids are clearly a key part of the solution. But how to get there still remains a hot topic of contention with millions of dollars in economic activity – and environmental value – at stake,” he said.

Read the Utility Dive Article
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