How Microgrids Work? - Types and Examples

Updated on May 3, 2023
How Microgrids Work? - Types and Examples

Microgrid equipment at the National Wind Technology Center in Colorado. | Photo courtesy of the National Renewable Energy Lab.

What is a Microgrid?

A microgrid is a local energy grid with control capability, which means it can disconnect from the traditional grid and operate autonomously.

How does a Microgrid Work?

To understand how a microgrid works, you first have to understand how the grid works.

The grid connects homes, businesses and other buildings to central power sources, which allow us to use appliances, heating/cooling systems and electronics. But this interconnectedness means that when part of the grid needs to be repaired, everyone is affected.

This is where a microgrid can help. A microgrid generally operates while connected to the grid, but importantly, it can break off and operate on its own using local energy generation in times of crisis like storms or power outages, or for other reasons.

A microgrid can be powered by distributed generators, batteries, and/or renewable resources like solar panels. Depending on how it’s fueled and how its requirements are managed, a microgrid might run indefinitely.

How does a Microgrid Connect to the Grid?

A microgrid connects to the grid at a point of common coupling that maintains voltage at the same level as the main grid unless there is some sort of problem on the grid or other reason to disconnect. A switch can separate the microgrid from the main grid automatically or manually, and it then functions as an island.

Why would  a Community choose to Connect to Microgrids?

A microgrid not only provides backup for the grid in case of emergencies, but can also be used to cut costs, or connect to a local resource that is too small or unreliable for traditional grid use. A microgrid allows communities to be more energy independent and, in some cases, more environmentally friendly.

How Much can a Microgrid Power?

A microgrid comes in a variety of designs and sizes. A microgrid can power a single facility like the Santa Rita Jail microgrid in Dublin, California. Or a microgrid can power a larger area. For example, in Fort Collins, Colorado, a microgrid is part of a larger goal to create an entire district that produces the same amount of energy it consumes.  

<b>How Much can a Microgrid Power?</b>

What are the Different Types of Microgrids?

Two key types of microgrids can be distinguished, and two other related types of power systems apply very similar technology.

  1. Customer microgrids or true microgrids (µgrids) are self-governed, and usually downstream of a single point of common coupling (PCC). Many of the most well known demonstrations are of this type. They are particularly easy to imagine because they fit neatly into our current technology and regulatory structure. Just as a traditional customer has considerable leeway in the operation of the power system on its side of the meter, so the restrictions on the nature of a µgrid are relatively loose. For this reason, one would expect much of the early deployment of microgrid technology to be of this type.
  2. Utility or community microgrids or milligrids (mgrids) involve a segment of the regulated grid. There are also existing well known examples. While technically, they not be different from µgrids, they are fundamentally different from a regulatory and business model perspective, primarily because they incorporate traditional utility infrastructure. The corollary of this feature is that utility regulation comes much more significantly into play. In other words, any mgrid must comply with existing utility codes or accommodation must be made in the code.
  3. Virtual microgrids (vgrids) cover DER at multiple sites but are coordinated such that they can be presented to the grid as a single controlled entity. Very few demonstrations of vgrids exist, but they have been proposed in the literature. Note that to be consistent with the definition above, the system must be able to operate as a controlled island or coordinated multiple islands.
  4. Remote power systems (rgrids) are obviously not able to operate grid-connected, isolated power systems involve similar technology and are closely related. So close that from a research point of view, they are commonly described as microgrids.

Examples of Microgrids

Microgrid projects have been undergoing a boom for the last past years after proving their value in critical situations.

This page will present state-of-the-art examples of projects accomplished or still under construction. As we will be updating this page frequently, please feel free to come check it out regularly.

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Here are some of the most interesting examples of Mirogrids our in the wild:

New York University

New York University (NYU), one of the largest universities in the United States, has produced power on site since the 1960s and installed a large oil-fired cogeneration plant in 1980. At the end of that facility’s useful service life, NYU made a transition away from oil-fired technology towards a modern natural-gas fired combined heat and power facility, with eyes towards microgrid capabilities, better reliability, and a better control of their energy expenditures.

The upfront capital cost of the upgrade was significant at $126 million. However, tax-exempt bonds arranged through the Dormitory Authority of the State of New York and through NYU tuition and fees helped to provide low-cost financing sources.

The CHP system has an output capacity of 13.4 MW (twice as much as the old plant’s capacity) and has been fully operational since 2011. It supplies electricity to 22 buildings and heat to 37 buildings across campus. The microgrid consists of two 5.5 MW gas turbines for producing electricity coupled with heat recovery steam generators and a 2.4 MW steam turbine. The NYU microgrid is connected to Con Edison distribution grid and purchases electricity when demand is superior to the on-site generating capacity.

Yet, unlike before, the NYU microgrid is now able to island from the distribution grid. This has been successfully tested during Hurricane Sandy when the NYU microgrid successfully islanded from the local distribution grid and continued to provide reliable power to much of the NYU campus.

The modernization of the plant has presented impressive results both economically and environmentally and has proven its benefits. NYU has evaluated savings on total energy costs to be $5 to $8 million per year. The new facility has drastically reduced NYU’s local emissions with an estimated 68% decrease in EPA criteria pollutants (NOx, SO2, and CO emissions) and 23% decrease in greenhouse gas emissions. This has been a great step towards the commitment that the university made to the City of New York to decrease its greenhouse gas emissions by 30%.

What other Resources are there?

To learn more about what the Energy Department is doing to research microgrids, you can visit the Office of Electricity’s



The article was recreated from the resources that no longer exist (are online): – “How Microgrids Work?”
Grid International Group – “Types Of Microgrids”, “Examples Of Microgrids”, “New York University Microgrid”, “Fort Collins Microgrid”, “Borrego Springs Microgrid”

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