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Why and How Microgrids prevent ‘the big hidden losses’

In the last few years we faced extreme weather conditions and a growing number of storms and hurricanes. This change has a big impact on ‘daily life’ and more specifically, the energy supply. The number of grid failures is growing and a big group of experts is developing solutions. One solution is using microgrids for the energy supply. They have many advantages but a very important advantage is often underexposed : Microgrids prevent big hidden losses.

Reaching the consumers energy demand with the use of a micro-grid, which utilizes a fitting combination of renewables (e.g. wind and solar energy), contributes immensely to a healthier climate, because the emission of harmful substances is drastically reduced. This however, is only the first major advantage. Through the use of microgrids, the overall stability of energy delivery can be increased, and in part because of this, the financial benefits of microgrids are substantial, much more so than expected.

During the development of a micro grid, the CAPEX and the OPEX are always taken into account. The question that is (understandably) asked, is as follows: “What are the final costs per kW/h in the new situation, and what advantages does this give compared to the current situation?” In many of these cost-benefit calculations however, many hidden costs are unaccounted for.

For an example, one only needs to look at the consequences of hurricanes. In the past, lots of energy networks completely shut down as a result of these natural disasters. Each energy network was responsible for delivering energy to many users. When even a single one of those energy networks goes down, everything that is connected to it is suddenly cut off, leaving many businesses and a large portion of the population without electricity. All the food in fridges will quickly spoil, the cost of all that food suddenly gone to waste, and that is just an example for consumers.

Businesses that rely on heavy equipment, or computers and databases? losing power is a disaster for the daily operation. This will lead to many inconveniences, waste of resources and huge losses in profit. This is most certainly annoying and expensive, but even more importantly, it is dangerous. Factories and other essential installations, such as water treatment plants, rely on electricity for a major part of their duties and processes. When the power is suddenly cut off, these essential installations suddenly stop working, which can quickly make an already dire situation even worse. That is not to even mention the rate at which things can be rebuilt, which will almost certainly decrease in the absence of electricity.

A Factory will face a big loss if there is no power. The loss of production volume, employees that can’t work but have to be paid, customers that unexpectedly do not get their goods, etc.

All of these problems can be abated or even outright avoided with micro grids. They are set up in such a way that they can immediately solve the power outage, and the renewable components can be replaced or used again almost immediately after the storm passes.

We are always moving forward, and the solutions to the problems mentioned above have already been realised. Switching from a large energy network to a microgrid is a big step, but the benefits are undeniable. The food of thousands of consumers spoiling is wasteful, especially when it can be so easily avoided. A resort unable to host guests because of a slow rebuilding process and energy supply is expensive, especially since there is such a simple solution. A hospital whose equipment cannot function without electricity is dangerous, especially because there is such a safer and straightforward solution.

Do you want to know what your hidden losses will be in case of a grid failure? We have a model that gives insights regarding the hidden costs. These insights will help you to understand the risk and cost of hidden losses and the value of a microgrid for your situation!

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