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Partner with SEPA on Your Microgrid Journey

In September 2017, category five Hurricane Maria made landfall in Puerto Rico, ripping away electricity infrastructure and leaving residents in a months-long blackout. In response to this devastation, SEPA joined an initiative alongside EPRI, ConEd and other stakeholders to explore ways to rebuild the Puerto Rican electrical system to be better and more resilient. SEPA worked with engineers and volunteers on the ground to assess damage to the large island-spanning transmission lines. The team evaluated how distributed and decentralized power generation and storage could be deployed to increase resilience and flexibility of the system.

Puerto Rico, like SEPA, was at the early stages of their microgrid journey in 2017. Since then, Puerto Rico has released new utility rate structures and third-party RFPs to develop microgrids, and SEPA has incorporated microgrids as an element of its mission to accelerate the transition to a carbon-free energy system.

Microgrids can play an important role in accelerating this transition by incorporating clean and resilient energy, and advancing the integration of distributed energy resources into the grid.

Demystifying Microgrids
Microgrids can serve many applications. As shown in Puerto Rico, microgrids can be used to provide power in a reconstruction effort following an extreme weather event. States are also beginning to build microgrids prior to extreme weather events as a proactive measure to keep critical facilities online and bolster grid resilience.

Agreeing upon a definition for a microgrid also remains elusive.

Word cloud generated by the DOE’s Voices of Experience Initiative: Microgrids for Resiliency

At the most foundational level, a microgrid can provide power and operate either connected to or independent from the traditional grid. The other characteristics used to categorize a microgrid are less important. Ultimately, what matters most is:

  1. Who is in need of the microgrid, and
  2. Why do they need one?

At SEPA, our microgrid experts are frequently asked whether a microgrid is the right choice. Read the FAQ section below for further insight.

Sustainability & Microgrids

Do microgrids and renewable energy go hand in hand? The answer to this question is no. Microgrids can be supported using various fuel mixes. Some of those fuel mixes may be renewable, while others rely on fossil fuels. The fuel mix of a microgrid depends on local energy resources, budget, local and state clean energy goals, and stakeholder preferences.

BUGs vs. Microgrids

Many energy industry stakeholders ask whether microgrids equate to a back-up generator (BUG). The answer is while microgrids can provide back-up generation capabilities, they are much more than that. Microgrids consist of generation, load, and often storage capabilities. They may be complex, and include the ability to seamlessly connect and disconnect from the grid, while balancing supply and demand. Microgrids can provide significant grid services. BUGs cannot.

When and Where Microgrids Are Most Suitable
Location matters! The value that a microgrid can provide depends largely on its location. Communities face unique challenges that vary with geography. The West faces wildfires, the North experiences subzero temperatures, the coastal South endures hurricanes, and various states are hit with unexpected extreme weather events as a result of the changing climate. Collectively, these challenges make grids vulnerable.

Trends in Microgrid Legislative Action

The choropleth map below shows the number of microgrid-related bills that have been proposed or enacted in each state from 2015 through Q3 of 2021. During the past six years, 21 states have proposed 131 and enacted 53 microgrid-related bills.


These bills are largely conceived to address grid reliability concerns and build resilience within the state. Microgrid- and resilience-related bills often arise following an extreme weather event or prolonged outage.

Microgrids can serve the system at several different physical locations:

  1. Solar and storage at individual residences
  2. Clean microgrids serving public use facilities, critical infrastructure facilities and select commercial sites (i.e. grocery stores and fuel providers)
  3. Larger, clean microgrids operated at the substation or community level

When determining where to locate a microgrid on the grid, SEPA recommends that stakeholders consider which public good and mission-critical services people rely on most for their health and safety when the main grid is down. The answer to that question can vary substantially and often revolves around system, social and disaster vulnerabilities. SEPA uses the following criteria to identify which services to prioritize with a microgrid:

  • Ability to provide resiliency to customers and grid services during normal operations
  • Risks, hazards and threats to power system reliability
  • Reliability hotspots and power outage statistics
  • Energy burden
  • Population density
  • Geography and topography

Deciding Whether Microgrids Are Right for Your Community
SEPA helps utilities, energy offices and industry stakeholders identify the weak points on their grid. For example, SEPA worked with Kentucky’s Office of Energy Policy to identify potential locations suitable for microgrid deployment across their state. Working together, the two organizations convened stakeholders to discuss criteria for prioritizing areas of greatest value for a microgrid, as well as which types of critical facilities to evaluate as potential microgrid locations. SEPA advised the state and led a significant geospatial data collection effort to build an inventory of all critical facilities in the state, as well as natural hazard risks, areas of relatively low grid reliability, population density and areas affected by relatively high energy burden. Through advanced geospatial analysis, SEPA identified nearly 600 potential site-specific and 12 potential regional community microgrid deployment locations that met stakeholder needs. SEPA then distilled that list to equally represent each region of Kentucky.


Working with all stakeholders throughout a microgrid project is critical. The SEPA Microgrid Playbook offers a helpful guide for those early in their microgrid journey. The key to successful early stage microgrid development is taking an unbiased approach during customer and stakeholder meetings. Whether it is a federal, state, local or utility initiated microgrid project, pursuing inclusivity by engaging more people early in the process builds community and stakeholder support. Working with neutral third parties such as SEPA can secure support and build consensus within the community.

Important stakeholders to engage in the planning process of microgrid projects include:

  • Utilities: Stakeholders from each department within the utility (e.g. customer-facing, engineers, regulatory/government affairs) should be welcomed in project discussions.
  • Members of the community: Seek to include community members beyond those who are engaged and can afford to take time out of their day. Ensure that vulnerable community members and those who experience the greatest energy burden are invited to participate and are treated as important stakeholders. Earlier this year, SEPA supported the Joint Investor Owned Utilities (IOUs) of California as an advisor to implement a large microgrid incentive program across the state.
  • Government agencies: The majority of critical facilities and infrastructure are owned by the government. Building trust is a two-way street. In 2020, SEPA partnered with the Housing Authority of the City of Annapolis to develop microgrid strategies for a low-income redevelopment project.

Electric system stakeholders are placing increased emphasis on developing a clear inventory of the project costs and benefits, in order to make the microgrid business case to governing bodies, such as a board, executive leadership or a regulatory agency. Once the project leaders have established a microgrid strategy, chosen which stakeholders to include in project discussions and decision-making, and identified a suitable location(s) for deployment, the next step is evaluating the project’s technical and economic feasibility. Begin with preliminary microgrid design and quantitative analysis to determine specific project benefits, costs and overall cost effectiveness. Then, conduct a series of analysis to test the technical and economic feasibility before moving forward with construction. Leverage the upfront strategy and planning work to prioritize potential sites for analysis.

Several organizations, such as the Maryland Energy Administration, have entrusted SEPA with the technical and economic feasibility evaluation of their microgrid projects. SEPA also has several projects in Wisconsin on the horizon. Organizations interested in working with SEPA during the microgrid project design process can do so in the following ways:

  • Economic Modeling: Streamlined preliminary microgrid design framework feeds into in-depth quantitative analysis to determine project benefits, costs and overall cost effectiveness.
  • Feasibility Studies and Data Analysis: Preliminary microgrid design expertise can help determine the feasibility of a site-specific or regional community microgrid project for resilience. SEPA capabilities include GIS data analysis, site assessments, load profile analysis and microgrid sizing.

No matter where you are in your microgrid journey, SEPA has a team of experts and resources to help guide you. Our services can help utilities, local and state governments and other industry stakeholders move from planning to building microgrids.

Additional Resources

A selection of SEPA microgrid resources are listed below for your convenience:

  • The Microgrid Playbook: Community Resilience for Natural Disasters
    • Natural disaster threats are increasing and microgrids are one tool in the energy toolbox for increased resilience. Get strategies for holistic microgrid and resilience planning against natural disasters as well as an adaptable five-step planning approach.
  • SEPA Microgrid Design Framework
    • Understand how to gather the information vital to a successful microgrid and follow our 10-step process that standardizes the design process. Explore key questions to consider for matching resilience solutions with resilience problems.
  • How to Design Multi-User Microgrid Tariffs
    • Unpack the complexities between utility, customer and regulatory agreements for multi-user microgrids.

Are you ready to learn more and begin charting your microgrid journey? Please reach out to Jared Leader at SEPA.

Jared Leader
Sr. Manager of Research and Industry Strategy
[email protected]
(202) 609-8938