• Energy Storage Microgrids
  • Microgrid
  • Europe
  • Climate Change
  • Grid Resilience

European Microgrid Innovation Focused on Remote Islands

Peter Asmus
Sep 15, 2020

Guidehouse Insights

Europe is a global leader on large-scale renewable energy such as offshore wind farms and frugal when it comes to energy consumption. However, it is not a hotspot for microgrid deployments. There are several reasons for this:

  • The European grid is extremely reliable, so while power outages drive microgrid adoption in the US, they largely do not in Europe. The grid deploys a different grid architecture than the US and its primary policy tool to boost onsite power supply (the feed-in tariff) conflicts with the notion of self-sufficient islanding microgrids since it is designed to maximize electricity sales into wholesale markets.
  • The markets in Europe are the most advanced in the world when it comes to real-time trading, a benefit of the EU structure and integrated national energy markets. When the wind dies in Denmark—which set a goal of 100% renewable energy for electricity, heating, and transport by 2050 almost a decade ago—it can import carbon-free hydroelectric power from Scandinavia or nuclear capacity from France to balance its regional grid.
Remote Islanding

When it comes to distributed energy resources (DER), Europe is the world leader on virtual power plants but a laggard on microgrids. This is despite the fact that many of the leading large technology companies are based in Europe (among them ABB, Schneider Electric, and Siemens). 

Yet there is one market segment where Europe is a leader: remote islands. Evidence supporting this supposition came from a virtual conference held last week, the Virtual Island Summit 2020. Among the presentations were profiles of the Orkney Islands in Scotland, which rely on community wind turbines, tidal power, hydrogen, and demand response to keep the lights on and clean mobility ventures on track. The small French island of Ushant has set a goal of 100% renewable energy reliance by 2039, leveraging both tidal flows and energy storage to help meet this ambition. 

Energy Storage for Microgrids

Unlike 10 years ago when most microgrids were designed to eliminate or reduce the size of batteries and other storage devices, the vast majority of new microgrids include some form of energy storage. Guidehouse Insights expects the amount of energy storage deployed within microgrids to reach 9 GW globally by 2029 (see the figure below). While lithium ion batteries maintain a market leadership position in the coming decade, longer duration storage like flow batteries and the shorter power applications associated with flywheels gain market share over time. The most prevalent form of storage in the past—lead acid batteries—is less and less popular.  

Annual Energy Storage in Microgrids Capacity by Region, World Markets: 2020-2029

Annual Energy Storage in Microgrids Capacity by Region, World Markets: 2020-2029

(Source: Guidehouse Insights)

QuinteQ, a flywheel technology company, is sponsoring a two-part virtual conference September 15. With the provocative title, “The Next Big Thing: How Microgrids Will Take Over the World,” the first event will feature Guidehouse Insights’ predictions about the future. Along with presentations on remote island systems, military and humanitarian microgrids, and commercial and industrial applications by other experts, I review why energy as a service and modular microgrids are exciting new trends within the industry. For more information on this event and its counterpart on September 29, visit https://www.quinteqenergy.com/microgrids/events/.

Climate Change Hastens Microgrids Trend

In 2019, wildfires hit Sweden, Norway, Greece, and other countries at a rate 3 times higher than any previous year. As a result, interest in microgrids beyond those serving remote islands may indeed be picking up in Europe. Climate change will likely only encourage this trend.