instyle solar how microgrids are powering the people _

Microgrids are by no means new. They’ve been powering the isolated for many generations, well before the term microgrids was even coined.

They’ve gone about the business of keeping the lights running in remote communities everywhere, whilst we, the ever-growing members of the population, have never cared less, never giving microgrids a second thought—or a first thought for that matter.

And why would we? Technologically speaking, microgrids in a traditional sense are quite unremarkable. Moreover, the vast majority of us draw power from a centralized grid. Why would we care?

Well, there’s a very good reason for a heads-up here. The vast majority of us are completely reliant on electricity. It is such an integral part of our lives that we take it for granted. But, like it or not, there are changes afoot.

With spiralling electricity costs, the growth of renewables, and not to mention the urgency presented by climate change pressure, the way we consume electricity is headed for change, dramatic change. In fact, the change has already begun.

We are all very aware of how the word ‘smart’ has popped up to preface technologies that are already part of our lives; smart phones, smart televisions and smart cars, to name the popular examples. But what about smart grids?

Yes, smart grids, or smart microgrids. The looming reality of smart microgrids powering the people has arrived at our meter boxes for a combination of reasons.

Firstly, there’s the growth in cutting-edge technologies, including renewables technologies and electricity storage.

Secondly, there’s the power dilemma we are all enduring because of our existing inefficient and costly methods of power generation and distribution.

Now, we combine this with a not so recent, but recently reimagined computer technology called blockchain, and the smart microgrid is destined to become as integral to our daily lives as the cell phone and the internet. It’s not about ‘if’ anymore, it’s about when.

We’re strong advocates for staying current on developments, issues, and innovations on the electricity front. Understanding what is happening off the mainstream radar to meet current and future power challenges will help us to integrate future changes into our way of life.

With hints of what is coming our way in terms of changes in electricity generation, distribution, and consumption, we can prepare. And without doubt, the prepared always fare better in the face of radical change. That’s why we are sharing this information with you.

The gradual move to smart microgrid power distribution is coming. It is our future. Please don’t worry or panic, however—this is not a doom and gloom announcement. No need to feel threatened. This is in fact wonderful news. The smart microgrid is a revelation. It is for the better, and the good news has already hit mainstream media.

With recent solar technology innovation, uptake of solar power generation, and the recent revelation of blockchain for power distribution, microgrids are starting to hit the headlines.

Well, maybe not headlines, but they’re certainly making page 36 of any worthy tabloid, and perhaps as early as page 4 of a broadsheet.

And the reason for this visitation to mainstream popularity? Well, it’s a good news story about electricity. And let’s face, it we need one.

This news story is about electricity innovation. It’s about power independence, and a new style of power interdependence. It’s about power self-determination, community strength, green living and a serious reduction of carbon emissions. Importantly, it’s also about access to very affordable electricity. The smart microgrid is great news.

“Agreed”, we hear you say, “sounds like great news…”, but what on earth is a microgrid?

For those who were brave enough to hazard a guess and assumed a microgrid is a relatively small grid—congratulations, you’re correct. A microgrid is a small grid. You’re stunned by the revelation, we can tell, but now you know what a ‘microgrid’ is, you want to know what a grid is, don’t you!

Fair cop. Here’s an explanation with analogy, for easy consumption…

What’s a Grid?

In electrical power supply terms, when you hear the term ‘grid’ referred to, it means the network of cables, power poles, transformers and power lines that distribute electricity around the nation to homes and businesses. The term also includes the power stations that generate the power.

In short, it’s the centralized power generation and distribution system from which the majority of Australians receive electricity.

Our grid is indeed vast. By virtue of design, grids are cross-linked and backed up for consistency (as well as possible). Grids are very complex networks high in infrastructure, cost and labour. Our grid is driven by and large by thermal coal, and so is extremely high in carbon emissions.

The electrical grid can be likened to the road network. Roads crisscross the land, carrying and distributing vehicles. If, when on your chosen route to get somewhere, your path becomes blocked, you take another road to reach your destination. The electricity grid works in a similar way.

A grid is like a road system for electricity, and like roads, there are highways, freeways, streets, lanes and cul-de-sacs. They all link up, and one road leads to another, loosely speaking.

There’s the high-tension cables atop enormous structures that look like steel monsters. They’re like the freeways, servicing vast numbers of people over huge distances.

Then there’s the cable that goes from the power pole out the front on to your property; that’s like a narrow back street, it carries a much smaller voltage, and it services you only.

In short, the grid carries profound voltages across unfathomable distances to untold numbers of consumers, so we can all have toast for breakfast.

The important thing to note is that the centralised grid is ridiculously expensive to maintain and grow, relatively inefficient, and disastrous for the environment.

Getting the Drift? Cool. That Was Grids for Beginners. Now for Microgrids.

A microgrid is the same as a grid, yet it is tiny relative to centralised electrical power grids. Sometimes microgrids are completely independent of external power—i.e., not connected to the main power grid. Other times they are connected to the centralised power system, with the option of isolating.

Where the centralised grid services millions of electricity consumers, a microgrid traditionally services small, usually isolated clusters of electricity consumers.

It can be as little as a few homes, or the size of a small community, including its businesses and services. To put the size in perspective, a microgrid produces power by the kilowatts or megawatt.

The microgrid was created purely out of necessity. Australia is home to many small communities based many hundreds of kilometres from population centres. Often the terrain can be difficult to access, and they can be completely cut off from the rest of us at certain times throughout the year.

Servicing these locations with power from the central grid presents a significant challenge. Firstly, the infrastructure is simply not there. There are no nearby power poles and cables with which to transport the electricity; there’s certainly no power station.

So build the poles and cables, we hear you say. Fabulous idea, but who pays? Connecting a remote community to the grid could cost tens of millions, quite literally. That community may only be 4 or 5 dwellings strong. The expenditure simply cannot be justified.

To put things in perspective, a remote home or small community may only be several kilometres or less from grid access. Even bridging this small gap can be prohibitive in terms of costs. Hence a small, usually independent grid is created to power the community.

Usually, power to a microgrid comes from diesel generators. These enduring, hardworking machines, while certainly effective and generally reliable, are environmentally disastrous.

Firstly, even the good ones belch copious quantities of toxic black smoke into the environment. Secondly, there is a further environmental cost of transporting diesel fuel to remote locations to feed the generators.

There is also the hefty financial burden of purchasing diesel fuel and the cost of its transportation. In modern times, this cost has increased significantly. It is perhaps the expense and the limitations of diesel generators that had rendered microgrids into a stationary position.

This has indeed changed, however. With the advances in renewables technology, microgrids are now viable alternatives (many will argue the only alternative) for a range of applications, from powering remote communities, to powering industrial complexes, to powering all of us everywhere.

With the continual uptake of localised renewables generation, in concert with other forms of power generation, the microgrid, or ‘smart microgrid’ model, will apply to all of us, wherever we live. Yes, this includes the power-heavy coastal population.

The microgrid offers power that is cheap, clean and very reliable.

What Does a Microgrid Look Like?

You may well have visited a microgrid and not even known or considered it. Here’s a classic example of a standalone (off the grid) microgrid.

Take for example an island on the outer rim of the Great Barrier Reef. There is a fancy resort with capacity for 100 guests, consisting of 25 separate buildings. There is a national park with a caretaker’s residence. The is a government marine research centre and two private research centres.

This community gets the bulk of its electricity via a diesel-powered generator. There is also a modest 40-watt solar array with batteries. This is a microgrid.

It’s worth noting that with present solar and wind technology, the microgrid example above could easily be driven entirely by renewables, with a diesel generator used only as a backup.

The Future for Microgrids

A recent article in the economics section of Melbourne’s The Age discusses microgrids and Australian towns going off the grid.

The opening line is, “Australia is facing an energy crisis.” We’ll leave it to you to assess crisis or otherwise, but clearly, there is a need for solutions to combat the continuing and inherent challenges of powering Australia.

A Few of the Basic Problems in a Nutshell

  • The tyranny of distance. As we develop communities further away from the source of centralized power, the cost of delivering grid power to these communities becomes profoundly expensive. Governments are forced to subsidise power distribution to these communities at massive expense, up to $500 per household, a truly unsustainable equation.
  • Our coal-fired grid produces massive amounts of carbon emissions. Increasing our reliance on centralised grid power only increases our emissions. This is in direct conflict with national and international carbon emission target accords. And it’s very bad for the planet.
  • Aging power generation and distribution facilities will not be able to satisfy growing electricity demands. Brownouts in highly populated areas are already a reality during times of peak load.
  • Australian electricity consumers are struggling under the weight of very high electricity costs. These costs will continue to rise, upsetting an already highly taxed population. Cash-strapped, angry citizens that are nervous about reliable electricity present a massive headache for political parties seeking re-election.
  • In short, our current methods of electricity generation are inefficient, dirty and expensive. There are serious reliability issues and management is difficult owing to the complex balance of ownership and control.

The microgrid, driven by renewables such as wind and solar, presents a viable solution for each of the above mentioned challenges. The technology is here now. There are microgrids already powering remote communities using renewables. The model already exists.

Now, with blockchain and the smart microgrid, we are staring down an alternative that’s not only better than the current model—it’s shaping up to be absolutely brilliant.

Blockchain and the Smart Microgrid. The Not Too Distant Future

Renewables such as solar are fast making a home for themselves in the mainstream. These alternatives are part of our national conscious now. Australians, whatever their motivation, are integrating this technology into their daily lives.

This uptake, coupled with the projected uptake, places us in position that will allow us to reinvent the way we ‘do’ electricity. The smart microgrid. And the glue that binds the smart microgrid together is a software technology called blockchain. Go here for an explanation of blockchain and smart grids.

Blockchain—which links multiple decentralised power generation and storage units, like your solar and battery house, and mine, with our solar arrays, windmills and battery storage—is the core component of a smart microgrid.

It has the magical powers (really, just science) of removing the need for retailers, middlemen and total reliance on a central grid. That’s got to be good.

To put it simply, instead of us buying electricity from the central grid via retailers, we trade clean electricity with each other. Peer to peer, they call it.

Jim next door has a heap of surplus electricity in his fancy batteries. Jenny down the road has installed a new pool, so she needs more power. So Jenny buys her power from Jim’s excess stock.

This process is facilitated by a highly encrypted software program technology called blockchain. Essentially, blockchain manages the power distribution. And it does it far more securely, cheaply and reliably than current methods.

Please understand that this is a highly simplified explanation. Blockchain technology can be difficult to explain and understand. It’s the software behind bitcoin, which you may have heard a great deal about already.

We’d hate to scare you back to burning coal in your incinerator in protest at a long-winded explanation on blockchain.

So the simplified version is more appropriate for this article in order to keep you with us to the end. We just want you to know that the smart microgrid is the future of electricity consumption in Australia, and likely, the globe.

Look to Jim and Jenny a couple of paragraphs back and you have the gist of it.

Note: For those of you that would like to know more about blockchain, there are countless explanations. The reason is that many try to explain it simply but fail. We suggest doing your own research. Google ‘blockchain definition’ and you will find many definitions presented in many different ways. Find one that works for you.

All the ingredients and technology exist to see the role out of clean, cheap, reliable electricity via smart microgrids. The complexity is in the integration.

With the right political commitment, the microgrid will become an integral part of Australian power generation into the future. Many would argue, it has to. With the integration of blockchain into the electricity equation, a new electricity consumption paradigm will emerge.

A Few of the Possibilities/Realities of the Growth of Microgrids

  • New subdivisions and the infrastructure that supports them will be able to function independent of a centralised grid power. They can be carbon neutral, power secure, and highly cost-effective.
  • All Australians will be powered via the smart microgrid. We will trade power with each other using blockchain technology. Our power and electricity will be clean, green affordable and regulated without the need for retailers, and centralised electricity generation and distribution.
  • With renewables, many of us will become mini electricity generation plants, or electricity prosumers.
  • The industry can decentralize while still remaining connected to major transport corridors. Massive reductions in power costs create economic efficiencies that increase competitiveness and growth potential.
  • Microgrids can facilitate and support growth in the farming and rural sectors. Again, the potential for population decentralisation, a desire of many a past government, is increased due to accessible, affordable power.
  • Many Australians will genuinely end up paying less for electricity. Follow this link for a great article about microgrid economics.
  • Without the demand for massive government financial subsidies to fund power distribution hundreds of kilometres away from the source, money is freed for better investment.
  • With the reduction in carbon emissions, Australian green targets become more attainable. We’ll play a stronger, potentially leading role in mitigating climate change.
  • Even where a microgrid has to generate power from fossil fuels, the fact that it is generated on site creates significant efficiencies, that significantly reduce carbon emissions compared to the centralised grid alternative.
  • More communities and population centres will be protected from the disruption and huge cost of significant, destructive weather events.

These are just a few of the benefits and realities presented by the integration of microgrids to the Australian power system. Even presented in brief here, the reality of what may come is a least very positive, and for many quite exciting.

While the development and integration of microgrids is perhaps more complicated than presented in this article, the failure to embrace this new version of an old model will present complications that are desperately grimmer. For all of us.


While headlines like “Australia is facing an energy crisis” might provide irresistible clickbait and sell newspapers, we’d certainly advise caution before diving headlong into a glass half empty.

Those of us that keep even the most casual eye on Canberra will accept that leadership in regard to Australian energy matters is currently difficult to fathom. One could successfully argue that the crisis is not with energy or energy innovation at all, but instead localised to those making energy-related policy.

Despite the apparent unhelpful dithering, or perhaps because of it, Australians and Australian ingenuity will continue to play the dominant hand in leading us successfully into a new power age where electricity generation, distribution and consumption only loosely resembles that which we have become used to over the last century. Necessity demands it.

As the suburban fringe expands ever further away from our coastal havens, microgrids represent a path to carbon neutral expansion.

Indeed, there are a number of LGAs that have a carbon neutral target already in the crosshairs, thanks to the potential of microgrids.

Microgrids will also mitigate against the rampant power price hikes that negatively impact families and inhibit economic growth.

Remember, microgrids are not just about those living on the suburban fringe or those in remote locations. Blockchain and the smart microgrid presents a real, and indeed likely, solution for the coastal-centric, power hungry bulk of us.

Change is mandatory, what we’ve been doing until now is unsustainable. The smart microgrid presents a very real solution. Cheap, clean, reliable power that we trade between each other is our future. As to when it becomes our now? This is where we need leadership.

While necessity has always been the mother of invention, a cold hard dose of financial imperative is surely the father of pulling your finger out. Many Australian individuals, businesses and innovators already have.

Cue the microgrid, a system ideally suited for combatting that eternal Australian conundrum: the tyranny of distance in a fossil fuel rich land.

Thanks to our innovative front runners, the future looks power-full, with a serious green tinge about it. With electricity delivered to our homes and businesses in bite-sized chunks, peer to peer, free of the costly middlemen, the future is looking electric.

It’s green, it’s reliable, and geographically speaking, makes so much more sense than the current model, considering contemporary demands.

Importantly, whether off the grid, central grid supported, full renewable or partial, the power distributed via microgrids promises to be a heck of a lot more affordable. No crisis there.

Want to know more? Follow this link for deeper insight to the future of microgrids, and this link for an in-depth, academic microgrid presentation.

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Or talk to an Instyle Solar expert about the best solutions for home energy storage or PV-panels.

Otherwise, head back to the solar blog to find even more great educational content.

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