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Revenue for DER Deployments for Microgrids Is Expected to Experience an 18% Annual Growth to 2029

A new report from Guidehouse Insights examines distributed energy resources (DER) assets as the driving force behind microgrid deployments, providing capacity and revenue forecasts for nine technologies from 2020 through 2029.

As one of many options to aggregate and optimize DER, the microgrid platform allows for new levels of resilience and reliability, which is particularly valuable in light of emerging threats to global power grids, such as extreme weather events, earthquakes, wildfires, and terrorist threats. At the same time, microgrids can help organize mixed asset fleets of DER at the distribution network level. According to the report, total DER in microgrids revenue begins at $6.3 billion in 2020, reaching $27.7 billion annually by 2029, at a compound annual growth rate (CAGR) of 18%.

“With the right set of controls technologies, the microgrid platform can not only offer value streams to site hosts and other microgrid customers, but it also provides value upstream to the larger grid,” says Peter Asmus, research director with Guidehouse Insights. “It is in this latter function that microgrids overlap with other networking platforms such as virtual power plants (VPPs) and DER management systems.”

According to the report, the availability of government support for microgrids is affected by the design of incentives and subsidies for the gamut of available DER technologies that could be integrated into a microgrid. Support for DER assets will increase the viability of microgrids in any particular region. However, some forms of support can counterintuitively limit future microgrid applications, and in some cases, a decline in subsidy support, particularly for renewable generation technologies, can create incentives for microgrids.

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