Natural gas fueling microgrids
Baltimore Gas and Electric Company “BGE”, a subsidiary of Exelon Corporation (NYSE: EXC), recently announced that it plans to test microgrids at shopping centers in Maryland. A microgrid is a small-scale power grid that can operate independently or in conjunction with the area’s main electrical grid. One can think of it as a back-up generator or a supplemental power source during periods of heavy energy demand.
Any small-scale localized power station with its own power resources, generation and loads and definable boundaries qualifies as a microgrid. The benefits provided by microgrid – agility and self-sufficiency – are now in high demand among energy users who risk severe consequences in the event of power interruptions, such as universities, hospitals, military bases and data centers.
The modular nature of microgrids makes the main grid less susceptible to localized disaster. Modularity also means that microgrids can be used, piece by piece, to gradually modernize the existing grid. Other purposes include reducing costs and enhancing reliability.
BGE’s plans stemmed from the recommendations of a task force led by the Maryland Energy Administration in the wake of extended outages caused by Hurricane Sandy. The task force evaluated microgrids for reliability and found them in the public interest, urging electric utilities to apply to the Public Service Commission “PSC” to develop them.
The task force also concluded that electric distributors should incorporate “public purpose microgrids” into grid upgrade planning, given the increasing frequency of Atlantic storms and their increasing costs. The number of named Atlantic storms jumped 67 percent since 1995, costing between $20 billion and $50 billion, the report found.
BGE said it wanted to test both urban and suburban locations that included a mix of community services and were near either public transportation or major roads.
In its PSC application, BGE argues that “public purpose microgrids” have value for “BGE customers and others who may be in the service area supported by a microgrid during times of extended outages. The services supported by the proposed microgrids will serve a large number of residents and customers in and around the microgrid locations, well beyond those included in the islanded circuits.”
Extreme weather events in recent years have reminded business, military and political leaders of the fragility of electricity infrastructure in the United States.
“The increasing frequency of natural disasters is driving a stronger interest in microgrid and back-up power solutions,” says Brian Carey, who leads the U.S. cleantech advisory practice for accountancy firm PricewaterhouseCoopers.
An Associated Press analysis of industry data found that severe weather is the leading cause of major failures on the nation’s power grid. The number of weather-related power failures has climbed over the last decade, with the greatest spikes in 2008 and 2011, according to the AP analysis and independent studies.
Terrorism is another threat to the power grid. Prevention of cyber-attacks and frontal assaults on the power grid are a top priority for the Department of Homeland Security “DHS.” For example, on the DHS website, it is acknowledged that power distribution substations are intentionally isolated from one another to prevent power surges, known as fault currents, from cascading through the system and causing serious damage. This protection scheme limits the ability to reroute power from one substation to another in the event of an emergency.
Centralized electricity generation and distribution models have dominated the U.S. electricity system for more than a century. Conventional wisdom sees microgrids as a threat to utility company revenue streams. However that thinking is beginning to change. Utility companies across the country are struggling to balance customer costs with the need for improvements to counter the rising number of violent storms, floods and droughts threatening the U.S. power grid’s core infrastructure. Independent, decentralized power supplies keep the grid more stable.
Natural gas is emerging as the key energy source for microgrids. Diesel fuel is the traditional back-up generator fuel source for PUDs (public urban developments), shopping centers and other commercial back-up generator systems.
“The fallacy of using diesel fuel,” points out Clayton Fields, a spokesman for KC Petroleum, a Jacksonville supplier of petroleum tanks, equipment and services, “is that the fuel loading pumps at terminals require electricity to load the fuel into the fuel delivery trailers. If the regional electric grid goes down, you won’t be able to fill up the fuel trucks to deliver the fuel to the generators. This was a huge problem during Katrina in New Orleans and it was problematic in South Florida during Hurricane Andrew.”
Fields suggested that natural gas is a viable solution for generating microgrid electricity. “Most of the gas is piped in and you don’t need electricity to get it out of the pipelines. Plus, if the gas is delivered by truck, the trucks themselves can run on natural gas as well as standby generators for the electricity needed to operate the dispensers. Consequently, you would not need electricity from the grid, to fill those vehicles.”
BGE is testing natural gas powered generators at their test sites.
“The micro-grid strategy with technologies that are fueled by natural gas are essential to the growth of the micro-grid platform,” said Adam Waterson, Development Manager for CNG Infrastructure for Constellation Energy, also a subsidiary of Exelon. “As an abundant domestic resource with economic price benefits, natural gas will be a vital part of fueling growth in the U.S. economy including the development of micro-grids.”
BGE expects to use the results of the 12-month pilot program to explore future microgrid development throughout central Maryland.
(David Pearl is Vice President of Infinity Resource Group, Inc., a professional mineral rights consulting firm, specializing in the leasing and sale of mineral rights in PA, WV and OH. He is also managing director of a natural gas fuel dispensing patent holding company and director of a natural gas fuel island development company. Your questions are welcomed by calling 412-535-9200 or by emailing IRGOilGas@gmail.com.)