Is this the ‘Non-Weird’ Future of Microgrids?
Elon Musk, CEO of California-based Tesla, last week told analysts that he wants to get the energy world to a “non-weird future.” Meanwhile, about 2,000 miles away in Minnesota, an international energy gathering offered a glimpse of its own kind of energy future.
Musk’s future of microgrids is a place where consumers can easily (and more cheaply) purchase distributed energy systems in a one-stop shop setting.
“Just click here and you get a microgrid, and it just works. That’s a good way to go.” Musk said. “I think consumers obviously appreciate things that are easy, simple, fast.”
He added: “Just because the product is big doesn’t mean that the whole process needs to be complex. Bigness and complexity are not the same thing.”
His vision is very different from today’s reality. Rather than being a one-click purchase, microgrids are largely customized projects.
To get more quickly to this future, Musk wants to merge Tesla, his electric vehicle company, with SolarCity, which offers solar, storage and microgrids. This would allow customers to buy the products as a package and count on one company to ensure the system works together properly.
Musk’s future also is one where we (eventually) no longer use liquefied dinosaur bones to generate power. Future generations, he said, will look back on the practice as “a bit weird.”
“I think you will be telling your grandchildren you won’t believe what we used to do. We used to take out liquidized remains of dinosaurs and old plants and put them in cars and burn them to move, and did the same things with the power plants and the like. That sounds crazy,” he said. “So, we are trying to have the non-weird future get here as fast as possible.”
Embracing change in Minnesota
Meanwhile, in St. Paul, Minnesota at a conference aptly called Embracing Change, another angle on the future of microgrids emerged, this one not meant to end fossil fuels but a fossilized relationship — the strife between utilities and competitive companies.
The conference host was the International District Energy Association (IDEA), whose members include more than 2,000 district energy, combined heat and power (CHP) and microgrid companies. IDEA members for years have competed with utilities for customers. So it was poignant that a special guest at the conference was the Edison Electric Institute, a utility advocacy organization.
Even more interesting was a description of an agreement being formulated by IDEA, EEI, and the CHP Association, which would bring the groups together on regulatory reform.
Energy organizations signing a piece of paper might not sound like much. But for those who have followed the fierce rivalries over the years between independents and utilities, it could be something of a Reagan/Gorbachev moment.
Today the rivalry is often central in discussion about how to manage the coming distributed grid. Who will win and who will lose? Or will the two figure out a symbiosis? The stakes are high with about $120 billion (US Census) in annual revenue generated by the power industry. Each side has tried over the years to protect its turf before regulators.
Today, utilities are trying to figure out if they can offer microgrids within their cost-of-service regulatory constraints or if a new regulatory compact is needed.
“From my view, no industry is changing more quickly than the utility industry in North America,” said Rob Thornton, IDEA president and CEO, speaking at IDEA’s annual conference, which drew almost 800 energy insiders from 18 countries.