An Evaluation of Microgrid-Based Enterprise Viability

The global need to meet population housing needs through infrastructure development is at odds with the urgent necessity to mitigate the impacts of climate change. This investigation considers the relationships between built infrastructure and microgrid electricity supply by evaluating technologies that could provide economically-feasible and low- or zero-carbon development solutions. Existing and emerging building and microgrid technologies have significant potential to provide viable energy access solutions across multiple use cases and the potential to integrate well into financially attractive business models. Modular construction, or prefabrication, is an emerging construction technology demonstrating decreased costs and development timelines, with greater flexibility in deployment relative to traditional construction methods. Photovoltaic (PV) and battery storage technology mirror some of these aspects of deployment flexibility, while functioning as mature technologies with predictable financial parameters, especially within the context of microgrids. Evaluating these technologies through the lens of infrastructure costs, geographically specific time-of-use (ToU) rates, and stochasticity of demand and power generation will provide the foundations of financially-sound microgrid business models with insights towards feasibility. The results of this study indicate that microgrid-based business models are highly sensitive to capital cost variances, and the viability of these businesses is contingent upon a multitude of economic, technological, and policy factors.