Navigant: Remote Microgrids to Reach $8.4B by 2020 (Executive Summary):

Remote Microgrids

Commodity Extraction, Physical Island, Village Electrification,
and Remote Military Microgrids: Global Market Analysis and Forecasts

Off-grid power systems number in the thousands, and many of these are still powered by diesel generation. Others showcase smart and much cleaner combustion technologies capable of reducing diesel consumption by as much as a third even without any renewable generation. Once renewable distributed energy generation (RDEG) is added to the mix, these remote systems begin to look like the classic traditional microgrids that have been the focus of most government funding in the United States. It is these remote microgrids that are the focus of this Navigant Research report.

The International Energy Agency (IEA) estimates that by 2020, developing countries will need to double their electrical power output. Demand for energy, especially electricity, is growing much more rapidly in these nascent economies than the rate of expansion of conventional electricity grids in the major industrialized world. All told, the developing nations will represent 80% of total growth in energy production/consumption by the year 2035. One could safely assume that the majority of these new power supplies will be produced and distributed via remote microgrids and other related forms of distributed energy resources (DER). Navigant Research forecasts that global remote microgrid revenue will grow from over $3 billion in 2013 to more than $8 billion in 2020 under a conservative scenario.

This Navigant Research report analyzes the global market for remote microgrids in four key segments: commodity extraction, physical islands, village electrification, and remote military. The study provides an analysis of the market issues, including business cases, opportunities, and implementation challenges, associated with remote microgrids. Global market forecasts for capacity and revenue, broken out by segment and region, extend through 2020. The report also examines the key technologies related to remote microgrids, as well as the competitive landscape.

Key Questions Addressed:
  • What are the primary applications of remote microgrids globally, as well as regionally?
  • Which companies are pushing this market forward – and why?
  • What are the key generation sources for remote microgrids?
  • What are the pros and cons of each technology?
  • Which regions and applications are the best near-term bets for attractive returns on investment?
  • What are the business models behind remote microgrid projects?
Who needs this report?
  • Microgrid and smart grid technology companies
  • Microgrid project developers
  • Smart grid hardware and software providers
  • Large industrial power users
  • Government agencies
  • Military agencies
  • Non-governmental organizations
  • Investor community

Table of Contents

1. Executive Summary

1.1   Remote Microgrids Overview

2. Market Issues

2.1   Evolving Definitions of Microgrids

2.2   Remote Microgrids: Key Differentiators

2.2.1    Robust Control Features

2.2.2    Challenging Logistics

2.2.3    Lack of Utility Grid Support

2.2.4    Current Lack of Ancillary Service Revenue

2.3   Business Cases for Remote Microgrids

2.3.1    Commodity Extraction Microgrids

2.3.2    Physical Island Microgrids

2.3.3    Village Electrification Microgrids

2.3.4    Remote Military Applications

2.4   Current Remote Microgrid Opportunities

2.4.1    High Cost of Existing Energy Services

2.4.2    Declining Costs of Solar PV

2.4.3    Maturation of the Energy Storage Market

2.4.4    Military Advances with Mobile Microgrids

2.4.5    Growing Interest in DC Technologies

2.4.6    Developing World Population Dynamics

2.4.7    Bottom-of-the-Pyramid Energy Access Strategies

2.4.7.1    A-B-C Models and the Mobile Phone Phenomenon

2.5   Implementation Challenges

2.5.1    Private Capital Flowing to Grid-Tied Microgrids

2.5.2    Existing Energy Subsidy and Regulatory Schemes

2.5.2.1    Case Study: Tanzania

2.5.3    Energy Theft

2.5.4    Lack of Consensus on Best Business Models

2.5.4.1    Electric Cooperatives and Other Electricity Distribution Franchises

2.5.4.2    Fee‐for‐Service/ESCO Models

2.5.4.3    Community-Based Models

2.5.4.4    Private-Public Partnerships

2.5.5    No Fully Vetted Commercial Terms

2.5.6    Can Large Vendors Really Play?

2.5.7    Lack of International Standards Targeting Remote Applications

2.5.7.1    International Standards

2.5.7.2    IEEE Standards

3. Technology Issues

3.1   Remote Microgrid Technology Solution Scope

3.2   Remote Microgrid Technology Category Cost Shares

3.3   Inventory of Remote Microgrid-Enabling Technologies

3.3.1    Distributed Generation Technologies

3.3.1.1    Diesel Generators

3.3.1.2    Combined Heat and Power

3.3.1.3    Solar PV

3.3.1.4    Distributed Wind

3.3.1.5    Fuel Cells

3.3.1.6    Biomass

3.3.1.6.1.   Biomass Case Study: Husk Power Systems

3.3.1.7    Hydroelectricity

3.3.2    Electric Load Management Technologies

3.3.2.1    Smart Meters

3.3.2.2    Demand Response

3.3.2.2.1.    ADR Case Study: Village of Hartley Bay

3.3.2.3    Secondary Load Controllers

3.3.2.4    DC Alternatives

3.3.3    Smart Inverters

3.3.4    Energy Storage

3.3.4.1    Lead-Acid Batteries

3.3.4.2    Sodium-Sulfur Batteries

3.3.4.3    Flow Batteries

3.3.4.4    Lithium Ion Batteries

3.3.5    Distribution Network Optimization

3.3.5.1    Synchronous Condensers

3.3.5.2    Load Tap Changers

3.3.5.3    Ultracapacitors

3.3.6    Electric Vehicle Charging

3.3.7    Network System Controllers

4. Key Industry Players

4.1   Competitive Landscape Overview

4.2   Utilities

4.2.1    BC Hydro and Power Authority

4.2.2    DONG Energy

4.2.3    Kotzebue Electric Association

4.3   Large Technology Players

4.3.1    ABB Ltd.

4.3.2    General Electric

4.3.3    Toshiba

4.3.4    Other Large Major Technology Players

4.4   Developers/Integrators

4.4.1    General Microgrids

4.4.2    Green Energy Corp.

4.4.3    Sustainable Power Systems

4.5   Innovative Key Component Suppliers

4.5.1    Cummins Inc.

4.5.2    ETAP

4.5.3    Northern Power

4.5.4    OutBack Power

4.5.5    SMA

4.5.6    Xtreme Power

4.5.7    Younicos

4.5.8    ZBB Energy

4.6   Military Specialists

4.6.1    Arista Power

4.6.2    Intelligent Power and Research Corp.

4.6.3    Honeywell

4.6.4    Lockheed Martin

4.6.5    SkyBuilt Power

4.6.6    SolaRover

4.6.7    TM3 Systems

5. Market Forecasts

5.1   Remote Microgrid Market Overview

5.2   Forecast Methodology

5.3   Vendor Revenue Methodology

5.4   Regional Analysis

5.4.1    North America

5.4.2    Europe

5.4.3    Asia Pacific

5.4.3.1    Case Study: China

5.4.4    Rest of World

5.4.4.1    Case Study: South Africa

5.5   Analysis by Remote Microgrid Segment

5.5.1    Commodity Extraction

5.5.2    Physical Islands

5.5.3    Village Electrification

5.5.4    Remote Military Applications

5.6   Conclusions and Recommendations

6. Company Directory
7. Acronym and Abbreviation List
8. Table of Contents
9. Table of Charts and Figures
10. Scope of Study, Sources and Methodology, Notes

List of Charts and Figures

  • Total Remote Microgrid Revenue, All Segments, Conservative Scenario, World Markets: 2013-2020
  • Total Remote Microgrid Capacity, All Scenarios, World Markets: 2013-2020
  • Total Remote Microgrid Revenue, All Scenarios, World Markets: 2013-2020
  • Capacity for Top Five Non-U.S. Markets for Microgrids, Conservative Scenario: 2013-2020
  • Remote Microgrid Capacity, All Segments, Conservative Scenario, North America: 2013-2020
  • Remote Microgrid Revenue, All Segments, Conservative Scenario, Europe: 2013-2020
  • Remote Microgrid Capacity, All Segments, Conservative Scenario, Asia Pacific: 2013-2020
  • Remote Microgrid Revenue, All Segments, Conservative Scenario, Asia Pacific: 2013-2020
  • Remote Microgrid Capacity, All Segments, Conservative Scenario, Rest of World: 2013-2020
  • Remote Microgrid Revenue, All Segments, Conservative Scenario, Rest of World: 2013-2020
  • Commodity Extraction Microgrid Revenue, Conservative Scenario, World Markets: 2013-2020
  • Physical Island Microgrid Revenue, Conservative Scenario, World Markets: 2013-2020
  • Village Electrification Microgrid Revenue, Conservative Scenario, World Markets: 2013-2020
  • Remote Military Application Revenue, All Scenarios, U.S. DOD: 2013-2020
  • Top Five Export Countries by Market Share, Vendor Revenue, Conservative Scenario: 2020
  • Microgrid Application Triangle: Reliability, Fuel Savings, and Reduced Emissions
  • Remote Microgrid Ecosystem Market Value Chain
  • Declining Cost Curves for Solar PV
  • Battery Storage Applications for Microgrids
  • Shares of Population without Access to Modern Energy
  • Risk Mitigation Diagram for A-B-C Energy Access Model for ESCOs
  • Load Profile for Tropical Village Power System in Developing World
  • Current Levelized Cost of Electricity, Key Distributed Generation Technologies
  • Current Levelized Cost of Electricity, Key Distributed Generation Technologies
  • Remote Microgrid Revenue, All Segments, Conservative Scenario, North America: 2013-2020
  • Remote Microgrid Capacity, All Segments, Conservative Scenario, Europe: 2013-2020
  • Daily Solar Radiation and Clearness Levels for Tropical Remote Microgrid Sites
  • Monthly Wind Speed Estimates for Tropical Remote Microgrid Sites
  • ADR Architecture for Hartley Bay Remote Microgrid in British Columbia
  • Efficiency: AC vs. DC
  • Discharge Rates and Scale per Energy Storage Technology
  • Centralized/Distributed Hybrid Controls for U.S. DOD Applications
  • Continuum of Vendor Control Approaches
  • BC Hydro’s Bella Coola Microgrid
  • KEA’s Wales High Penetration Wind-Diesel Remote Microgrid Locatio
  • Solar PV and Small Wind on Miyako Island, Japa
  • Topology for INSENSUS/Cummins Sine Mousse Abdou Microgrid in Senegal
  • Frequency Response Summary for KEA’s Wind-Diesel Remote Microgrid
  • Relative Shares of Electric Power, OECD vs. Non-OECD Countries: 1990-2035
  • Solar PV End-Use Market Segments, Including Off-Grid: 2010-2050
  • Demand per Household Increases in Indian Market

List of Tables

  • Remote Commodity Extraction Microgrids SWOT Analysis
  • Remote Physical Island Microgrids SWOT Analysis
  • Remote Village Electrification Microgrids SWOT Analysis
  • Remote Military Applications SWOT Analysis
  • Diesel Generators for Remote Microgrids SWOT Analysis
  • CHP for Remote Microgrids SWOT Analysis
  • Solar PV for Remote Microgrids SWOT Analysis
  • Distributed Wind for Remote Microgrids SWOT Analysis
  • Fuel Cells for Remote Microgrids SWOT Analysis
  • Biomass for Remote Microgrids SWOT Analysis
  • Hydroelectricity for Remote Microgrids SWOT Analysis
  • BC Hydro SWOT Analysis
  • DONG Energy SWOT Analysis
  • KEA SWOT Analysis
  • GE SWOT Analysis
  • Toshiba SWOT Analysis
  • Other Large Major Technology Players
  • Commodity Extraction Remote Microgrid Capacity, Base Scenario, World Markets: 2013-2020
  • Commodity Extraction Remote Microgrid Capacity, Conservative Scenario, World Markets: 2013-2020
  • Commodity Extraction Remote Microgrid Capacity, Aggressive Scenario, World Markets: 2013-2020
  • Commodity Extraction Remote Microgrid Revenue, Base Scenario, World Markets: 2013-2020
  • Commodity Extraction Remote Microgrid Revenue, Conservative Scenario, World Markets: 2013-2020
  • Commodity Extraction Remote Microgrid Revenue, Aggressive Scenario, World Markets: 2013-2020
  • Physical Island Remote Microgrid Capacity, Base Scenario, World Markets: 2013-2020
  • Physical Island Remote Microgrid Capacity, Conservative Scenario, World Markets: 2013-2020
  • Physical Island Remote Microgrid Capacity, Aggressive Scenario, World Markets: 2013-2020
  • Physical Island Remote Microgrid Revenue, Conservative Scenario, World Markets: 2013-2020
  • Physical Island Remote Microgrid Revenue, Base Scenario, World Markets: 2013-2020
  • Physical Island Remote Microgrid Capacity, Aggressive Scenario, World Markets: 2013-2020
  • Village Electrification Remote Microgrid Capacity, Base Scenario, World Markets: 2013-2020
  • Village Electrification Remote Microgrid Capacity, Conservative Scenario, World Markets: 2013-2020
  • Village Electrification Remote Microgrid Capacity, Aggressive Scenario, World Markets: 2013-2020
  • Village Electrification Remote Microgrid Revenue, Base Scenario, World Markets: 2013-2020
  • Village Electrification Remote Microgrid Revenue, Conservative Scenario, World Markets: 2013-2020
  • Village Electrification Remote Microgrid Capacity, Aggressive Scenario, World Markets: 2013-2020
  • Remote Military Application Capacity, All Scenarios, U.S. DOD: 2013-2020
  • Remote Military Application Revenue, All Scenarios, U.S. DOD: 2013-2020
  • Total Remote Microgrid Capacity, Base Scenario, World Markets: 2013-2020
  • Total Remote Microgrid Capacity, Conservative Scenario, World Markets: 2013-2020
  • Total Remote Microgrid Capacity, Aggressive Scenario, World Markets: 2013-2020
  • Total Remote Microgrid Revenue, Base Scenario, World Markets: 2013-2020
  • Total Remote Microgrid Revenue, Conservative Scenario, World Markets: 2013-2020
  • Total Remote Microgrid Revenue, Aggressive Scenario, World Markets: 2013-2020
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