Microgrid construction cost analysis

What is a microgrid cost model?

The National Renewable Energy Laboratory was commissioned by the U.S. Department of Energy to complete a microgrid cost study and develop a microgrid cost model. The goal of this study is to elucidate the variables that have the highest impact on costs as well as potential areas for cost reduction. This study consists of two phases.

What is the DOE's microgrid cost study?

The U.S. Department of Energy’s (DOE’s) microgrid cost study is identifying the costs of components, integration, and installation of U.S. microgrids; project cost improvements; and technical accelerators during the next 5 years and beyond.

What is the final microgrid Study Cost Study Database?

The final microgrid study database consists of 80 entries and is described in terms of geographical location, DER capacity, and number of projects. It is compared to microgrid market reporting by Navigant Research and GTM.

What does Phase 2 of a microgrid project involve?

In a microgrid project, Phase II uses the results of Phase I to gain an initial indication of the costs that might be driving the cost of development the most. Cost information for 80 microgrids was collected through a survey by directly contacting industry members and microgrid owners and from publicly available information.

What is the output of a microgrid model?

The output of the model is a summary of the costs of a microgrid comprised of the components mentioned above and the costs of adding a conventional combined-cycle gas turbine to the existing T&D grid, including any necessary grid upgrades. The model calculates the annual net benefits from microgrid installation as follows:

Are microgrid complexity and component costs related?

In our database, we have limited information about both microgrid complexity level and component costs. Component costs, particularly for conventional generation, represent the largest share (88% for Level 2 and Level 5), leaving limited data for analysis by complexity level.