What are microgrids – and how can they help with power cuts?

(Credit: Unsplash)

This article is brought to you thanks to the collaboration of The European Sting with the World Economic Forum.

Author: Victoria Masterson, Senior Writer, Formative Content


  • Microgrids can power whole communities or single sites like hospitals, bus stations and military bases.
  • Most generate their own power using renewable energy like wind and solar.
  • In power outages when the main electricity grid fails, microgrids can keep going.
  • They can also be used to provide power in remote areas.

A nun in the Democratic Republic of Congo is showing the world how microgrids can bring electricity to all. Sister Alphonsine Ciza got fed up with daily electricity cuts in her convent and town, so raised the funding to build a micro-hydroelectric plant. This now powers two schools, a clinic and a church, alongside the convent.

So, what are microgrids? And how can they help plug gaps in energy supply?

Here’s an explainer.

What’s the World Economic Forum doing about the transition to clean energy?

Moving to clean energy is key to combating climate change, yet in the past five years, the energy transition has stagnated.

Energy consumption and production contribute to two-thirds of global emissions, and 81% of the global energy system is still based on fossil fuels, the same percentage as 30 years ago. Plus, improvements in the energy intensity of the global economy (the amount of energy used per unit of economic activity) are slowing. In 2018 energy intensity improved by 1.2%, the slowest rate since 2010.

Effective policies, private-sector action and public-private cooperation are needed to create a more inclusive, sustainable, affordable and secure global energy system.

Benchmarking progress is essential to a successful transition. The World Economic Forum’s Energy Transition Index, which ranks 115 economies on how well they balance energy security and access with environmental sustainability and affordability, shows that the biggest challenge facing energy transition is the lack of readiness among the world’s largest emitters, including US, China, India and Russia. The 10 countries that score the highest in terms of readiness account for only 2.6% of global annual emissions.

To future-proof the global energy system, the Forum’s Shaping the Future of Energy and Materials Platform is working on initiatives including, Systemic Efficiency, Innovation and Clean Energy and the Global Battery Alliance to encourage and enable innovative energy investments, technologies and solutions.

Additionally, the Mission Possible Platform (MPP) is working to assemble public and private partners to further the industry transition to set heavy industry and mobility sectors on the pathway towards net-zero emissions. MPP is an initiative created by the World Economic Forum and the Energy Transitions Commission.

Is your organisation interested in working with the World Economic Forum? Find out more here.

What are microgrids?

Microgrids are local power grids that can be operated independently of the main – and generally much bigger – electricity grid in an area. Microgrids can be used to power a single building, like a hospital or police station, or a collection of buildings, like an industrial park, university campus, military base or neighbourhood. Groups of microgrids that are linked together can also power bigger areas, like towns or cities.

Why are microgrids needed?

When storms or power outages shut down the main electricity grid in an area, large numbers of homes, businesses and critical services can be affected. This is because traditional electricity grids can cover whole countries or continents. For example, in the United States, the power grid connects 145 million customers and 7,300 power plants with around 160,000 miles of high-voltage power lines, according to the US Energy Information Administration.

Microgrids can switch away from the main grid and continue to provide power during emergencies like these. This process is known as ‘islanding’.

Microgrids can also provide power in remote places that have no access to electricity.

An infographic showing an example microgrid
Microgrids can provide power where bigger grids fail, even in remote areas. Image: Climate X Change

What are the other benefits of microgrids?

To generate and store their own energy, microgrids increasingly use renewable energy – like solar panels, wind turbines, batteries and, as in Sister Alphonsine Ciza’s case, water – in the form of hydropower.

This means more microgrids would help reduce greenhouse gas emissions.

Off-grid solutions like microgrids are also the most affordable way to get people connected to electricity in developing countries, according to the International Energy Agency (IEA). It says around 770 million people, mostly in Africa and Asia, live without access to electricity.

Decentralized solutions, including mini-grid and stand-alone systems, which are 90% based on renewable solutions, are the “least costly way to provide power for half of those seeking access,” the IEA notes.

How do microgrids work?

There are three main types of microgrid. Remote microgrids – also called ‘off-grid microgrids’ – are set up in places too far away to be connected to the main electricity grid. These generally run on renewable energy, like wind or solar power, and are permanently in island mode.

Grid-connected microgrids have a connection to the main grid, but can switch away from this if there are power supply issues, for example.

Networked microgrids are groups of microgrids that are connected together to serve a wide geographic area, like a community or city.

Which countries have microgrids?

There are around 4,500 microgrid projects around the world, according to a 2019 report from Navigant Research. Asia Pacific has the world’s biggest microgrid capacity, followed by North America, the Middle East and Africa.

In the US, there are 160 microgrids, according to the Center for Climate and Energy Solutions. Alaska, Texas, New York and California are some of the seven states where these are mostly based.

India also has 160 microgrid solutions across four states, according to Hive Power, a Swiss smart grid specialist. More than 80% of these are solar powered.

From jails to bus depots

In California, a jail with up to 4,000 inmates, Santa Rita Jail, has its own microgrid running on renewable energy sources including wind turbines, solar panels and a fuel cell that uses waste heat to help provide hot water. The jail started developing its microgrid after California’s 2001 energy crisis, when electricity prices soared, and supply shortages led to power cuts.

According to Microgrid Knowledge, projects to watch out for in 2022 include an electric bus depot microgrid being built in Maryland, near Washington, DC and plans for a solar-based microgrid funded by Meta – formerly Facebook – in its home city of Menlo Park, California. This will house a Red Cross emergency shelter, with back-up power from the microgrid in the event of widespread power outages.

In Australia, a town called Heyfield with 2,000 inhabitants in the state of Victoria hopes to develop a microgrid model that can be rolled out to other ‘edge-of-grid’ towns around Australia. The project, called MyTown Microgrid Heyfield, has funding from the Australian and Victorian governments.

Off-grid power in Africa

In Africa, a company called OffGridBox is using boxes made from sections of shipping containers to help provide power in remote areas. Solar panels fitted to the roof of the box power an irrigation system and agricultural equipment. The unit also purifies and desalinates water to provide drinking water. OffGridBox is a member of Uplink, the World Economic Forum’s platform for sourcing and accelerating innovations to some of the world’s biggest challenges.

Another project with links to the Forum is a microgrid described as the world’s most advanced on the campus of the University of California San Diego in the US.

The microgrid powers a 1,200 acre campus with 450 buildings and supports around 45,000 students and educators.

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