Microgrid
Also known as: micro-grid, islandable grid
A microgrid is a small, local electricity system, serving a campus, hospital, military base, neighbourhood, or remote community, with its own power sources such as solar, batteries, or generators.
Most microgrids connect to the main grid but can 'island,' disconnecting and running independently when the larger grid fails. While microgrids used to be expensive custom projects, cheaper batteries and solar have made them practical for a growing list of sites that can't afford to lose power.
Microgrid, explained at three levels
At home
Think of a microgrid like an apartment building with its own backup water tank. Most days it draws from the city mains, but if the mains fail, it switches to its own supply. A microgrid does that with electricity: a campus, hospital, or community has its own solar panels, batteries, or generators, and when the main grid goes down, it disconnects and keeps the lights on by itself.
At work
A microgrid is a local electricity system with its own generation, storage, and controls, serving a defined area such as a campus, hospital, military base, or remote community. It usually connects to the main grid but can island, running independently during outages. Businesses use microgrids to protect critical operations and to cut energy costs with local solar and storage.
At home
A microgrid has three main parts. Local power sources, such as solar, wind, or generators, make electricity. Batteries store it and smooth out sudden changes. A controller acts as the brain, balancing supply and demand second by second. The link to the main grid runs through a switch at a single connection point. When the controller senses a grid failure, it opens that switch and the microgrid carries on alone.
At work
Microgrid controllers manage islanding, load priority, economic dispatch, and resynchronization, which means matching voltage, frequency, and phase before reconnecting to the main grid. When islanded, the controller sheds non-critical loads if supply runs short. Business models include owner-operated systems and energy-as-a-service contracts, where a provider builds and runs the microgrid for a monthly fee. Interconnection approval from the local utility, including its protection settings, is required.
At home
On the main grid, huge spinning generators hold voltage and frequency steady almost automatically. A microgrid running alone has no such anchor, so a sudden load, like a large motor starting, can push it off balance. Something must take the lead, either a generator or a battery with a grid-forming inverter. While solar panels and batteries are now commodities, in my opinion the controller is the quiet hero, because smooth islanding is not.
At work
Design decisions include sizing for critical versus full loads, how many hours or days of outage to cover, and protection schemes that work in both modes, since inverters supply far less fault current than generators and can leave conventional relays unable to detect faults. Systems without spinning generators need grid-forming inverters. Standards such as IEEE 2030.7 and 2030.8 define controller functions and testing. For remote northern communities, cold-climate battery performance and local maintenance capacity must be planned from the start.
Real-world examples
At home
Carlos lives in a planned community near Calgary with a solar and battery microgrid. During a windstorm that caused a regional outage, his street stayed powered for most of the evening while nearby areas went dark.
At work
Lena is an energy manager for a remote First Nation in northern Ontario that relied entirely on trucked-in diesel. A solar and battery microgrid now supplies a significant share of daytime power, cutting fuel deliveries and noise.
How it compares
| feature | Microgrid | Main grid |
|---|---|---|
| Scale | Campus or community | Region or country |
| During outages | Can run independently | Affected customers lose power |
| Power sources | Local solar, storage, generators | Large central plants and many sources |
| Control | Local controller | Utility and system operator |
A microgrid is a small grid that can stand on its own when the big one fails.
For analysts
Microgrids are easiest to justify by pricing an outage. I'd calculate what a day without power costs the business, then compare it with the microgrid's cost minus its everyday energy savings.
History & origin
Thomas Edison's Pearl Street Station in Manhattan, opened in 1882, was essentially a microgrid: local generation serving nearby customers before large interconnected grids existed. Remote communities, including many in northern Canada, have long run isolated diesel grids. The modern idea of an 'islandable' microgrid developed in the early 2000s, with research led by the US Department of Energy and others. During Hurricane Sandy in 2012, Princeton University's campus microgrid kept power flowing while surrounding areas went dark, drawing wide attention. Since then, falling battery costs and more frequent extreme weather have fuelled microgrid growth at hospitals, data centres, and Indigenous communities replacing diesel with renewables. In my view, microgrids are resilience insurance that also pays dividends on ordinary days.