SolarCity, the largest solar installer and financier in the U.S., is now offering "microgrids as a service" by integrating its existing expertise in distributed renewables, inverters, energy storage, and control software. Those elements are already a portion of what makes a microgrid. (Typical backup generation in a microgrid relies on a diesel gen-set.)

SolarCity is targeting the usual suspects for microgrids: municipalities, remote or island communities, hospitals and military bases. SolarCity suggests "any community anywhere in the world vulnerable to power outages and high energy costs" is a potential customer that can be financed with "little to no upfront costs."

The company also contends that its microgrid service can provide "electricity to communities for less than they pay for utility power to offset the cost of emergency services."

Utility giant Duke Energy is working on interoperability between devices in its "coalition of the willing," but Duke has its eyes on potentially offering microgrid services in the future. Joining Duke in the coalition are companies including ABB, Alcatel-Lucent, AT&T, Cisco, Elster Solutions, General Electric (acquiring Alstom), Itochu, Itron, Leidos Engineering, S&C Electric Company, and Schneider Electric.

SolarCity spokesperson Jonathan Bass told GTM that the microgrid group originates from within CTO Peter Rive's engineering team and is related to its storage effort.



He said that the typical approach to designing and building a microgrid was either working with a large global engineering firm on a very expensive microgrid project or reaching out to individual suppliers and having a consulting firm piece the elements together.

Bass suggests that SolarCity's turnkey "microgrid as a service" model is another alternative that "fits into a realistic budget cycle." He said it is "a straightforward step to create this product" and that it is "extremely affordable." SolarCity is already working on distributed generation projects with municipalities such as California cities Lancaster, San Jose and Sacramento.

Bass noted, "In addition to providing the software and integration, similar to our other products, we will provide a financing option and O&M." He suggests that the primary benefit is resiliency and that this product might have a "more international flavor" for SolarCity. He added that the firm has already built a microgrid "at an undisclosed island location."

States hit by Hurricane Sandy have mobilized millions for microgrids

As GTM's Katie Tweed has reported, Massachusetts awarded more than $18 million to 13 projects across the state to enhance energy resiliency. The money will go to critical facilities for combined heat and power, battery storage and microgrids. Connecticut has invested more than $30 million in its microgrid program. New York opened a $40 million microgrid competition early last year, while New Jersey put up $200 million for its Energy Resilience bank, which will support distributed energy resources at critical facilities. Maryland has called for utility-run community microgrids with a focus on resiliency, although no projects have been formally announced.

States hit by Superstorm Sandy aren’t the only ones putting money into microgrid projects. California announced $26.5 million in grants last summer for microgrid projects that put renewable integration front and center.

GTM Research forecasts U.S. microgrid capacity will exceed 1.8 gigawatts by 2018, with a total value over $3 billion.