The renewable battle over the electric grid: Macro vs Micro
The solar power potential of the Sahara desert is absolutely massive. A solar panel in Algeria could generate 3x more electricity than the same solar panel in Germany.1 A 10,000 square kilometer solar farm in the middle of the desert would be enough to power the entire world, which is kind of crazy. But there’s a challenge. How do you get that energy distributed around the globe? Countries like India are pushing for a “one sun, one world, one grid” concept. And there’s a private company that thinks they can export solar and wind electricity from Morocco all the way to cloudy UK. But are macro power grid systems like this really the answer? Or is going smaller with microgrids going to be the future?
An introduction to power grids
I’ve been wanting to look into the micro vs. macro grid topic for a while since a lot of you have asked about India’s one sun, one world, one grid strategy. And more recently, Real Engineering did a fantastic video on the Morocco solar project specifically, which I’ll link to in the description. I learned a lot when my team and I started to pull this video together.
So before we enter the electric battlefield between macro- and microgrids, let’s first have a quick look at what a power grid is. We’re so use to just having power, we don’t really pay attention to the components that bring it to us. Whether it’s a nuclear power plant or an offshore wind farm creating electricity, one common element is that the produced electricity will need to travel some distance before reaching its destination. Enter the transmission and distribution network, a.k.a. the power grid. Typically, the alternating current (AC) moves from the original generation source to transmission lines. When flowing along these electric highways, the power has a high voltage to minimize losses over long distances. Once it’s near the final destination, local substations reduce the current voltage in a process called stepping down. Finally, distribution lines, the so-called “last mile” of the electric circuit will deliver the low-voltage electricity to your doorstep.
There are two types of high voltage lines: high-voltage alternating current (HVAC) and high-voltage direct current (HVDC). HVDC lines lose less power than HVAC lines, so you’d think all high voltage lines are DC. But because most utility-scale power plants generate AC electricity, in order to use HVDC lines you need to build converter stations – one to convert the AC power to DC to run along the transmission lines, and then another to convert it back to AC at the destination. Taking these costs into account, and then looking at the amount of electricity preserved on the HVDC lines, the sweet spot for when they make financial sense is for distances greater than 600 Km (373 miles)2
Now that we’re all charged up on what a power grid is, let’s look at our two contenders. First, macro-grids are the conventional centralized power systems.3 These could be region-wide, like in the US – which has the Western, Eastern and Texas subgrids4 powering our country – or they can even stretch across two continents. Next we have microgrids, which are smaller-scale systems that can be either connected to the macro-grid or work in a stand-alone mode.5 These local and independent networks normally serve confined areas like campuses, military bases, or business centers. So is bigger always better for the power grid? Or, to paraphrase an adage: is it a case of Good Things Come In Small Power Grids?
Macro grids, Macro challenges
There are cost saving benefits to macro grids. Looking at the US, if we were able to unify our three sub-grids, it could have electrifying environmental and economic benefits.6 Based on a 2016 study, moving to a continental grid would reduce the US electricity sector carbon emissions by 80%.7 According to the same researchers, a nationwide-scale network would save consumers about $47.2 billion a year. That’s because it would reduce energy waste while increasing the use of cheaper renewables. An illuminating example of a more connected grid would be the swap between Californian solar power and Midwest wind energy.8 So, why hasn’t this been done yet? A recent investigation says it’s a matter of politics.9 You have not only push back from the fossil-fuel industry, but also the difficulty of working with separate state-run public utility commissions that need to approve new power lines going through their state. There’s also a bit of NIMBY (not in my backyard) to this too. Why should I have a wind turbine in my backyard that’s powering someone else’s home thousands of miles away?
As I said in my opening, we could theoretically power the entire planet from one enormous solar farm in the middle of the Sahara desert, which sounds like a dream, right? Not only would you need to get numerous countries and regions to work in unison, but you need to carry that electricity across the globe to make it come true, which is no small feat. There are so many reasons why it hasn’t happened yet and most likely won’t.
As of today, there are only two 700 MW power cables connecting Africa to Europe, which were built across the Strait of Gibraltar. A third HVAC transmission line connecting Morocco with Spain is under construction, with an expected cost of 150 million Euros10. We would need over 800 more of these huge lines to power Europe alone. Using the 150 million Euros cost as a gauge – which is a best case scenario as we’re considering the shortest path between the two continents – building a macro-grid across all of Europe would cost billions.
As daunting a task as it is, last September Xlinks brought a sand-breaking project to light. The UK company has chosen Morocco as a strategic place for building a power plant generating 10.5GW of zero carbon electricity.11 Out of this renewable energy pot, they’ll send 3.6GW to the UK. Why Morocco? Well, it has the third highest Global Horizontal Irradiance (GHI) in North Africa. Basically, the GHI12 tells you how much sunlight hits a horizontal surface and you can use it to assess the efficiency of a solar panel. Not surprisingly, the Moroccan figure is about 3x higher than the UK. And during the winter months, their solar panels will produce up to 5x more power than those in the UK.
But it’s not just about everyday sunshine. Xlinks will benefit from the predictable North Atlantic trade winds that steadily blow all year long over there.13 Propelled by the temperature difference between the cool Atlantic Ocean and the hot African land, the wind speed will peak at night, when the British grid will be greedy for electricity. Thanks to this favorable weather condition, the energy generation site boasts a wind capacity factor of 55%.14 That’s the measure you use to assess a location’s feasibility for this kind of wind project. To give some perspective, UK offshore wind farms don’t go beyond the 40% mark. This clean energy cocktail will quench the UK thirst for renewables whenever its offshore wind production is low or the infamous British clouds loom on the horizon. Bottom line: Morocco is an ideal location for renewables.
The solar-wind generation combo is coupled with a 20GWh/5GW storage facility. Storing the excess energy output in a lithium-ion battery, Xlinks will provide the UK with a near-constant power supply. Covering an area of 1,500 square kilometers (ca. 932 square miles), the plant will send out energy for an average of over 20 hours a day directly to Great Britain. After being converted from AC to DC, the zero-carbon electricity will travel through 4 subsea jumbo HVDC cables splitting across two 1.8GW grid connectors. After running for 3,800 km (ca. 2361 miles), the current will be converted back into AC to access the British transmission network. Amounting to about 8% of the UK electricity demand, the Xlinks stable and renewable electricity will power 7 million British homes by 2030.
I don’t know about you but that wires me up. Anyway, let’s unwind for a moment because there’s an incredible amount of resources needed to pull this off. Where are they getting their titanic cables from? X-link will need loads of raw material – A total of 15,200 km (9445 miles). Which happens to be about 4x the world’s current annual production. You can probably see why this isn’t happening. Instead, advised by a cable extrusion specialist, X-link is going for a more cost-effective solution. They’ll set up their own factories in the UK, one of which will become the largest cable manufacturing plant in the world.
Given the size and scope of the project, I can hear you already. What’s the energy price tag for this? Thanks to the UK government Contracts for Difference, which is a program to support low-carbon electricity generation 15, the company claims their project will be profitable without requiring any funding support. Xlinks is aiming to secure a projected cost of electricity at about £48/MWh (ca. $65/MWh). With the Contract for Difference, whenever the electricity market price is below that strike price, the government will pay the generator to make up the difference. The other way around happens when the energy wholesale value is higher than that strike price. Looking at something like UK offshore wind, it’s priced at £40/MWh (ca. $54/MWh), so Xlinks power is slightly more expensive. But if we compare it to something like nuclear, like the Hinkley reactor that’s currently being built in the UK, Xlinks is about 50% cheaper.16
Given all the challenges of a project like this – multi-country agreements, cable construction issues, and the ethical questions around one of the richest nations in the world soaking up another countries natural resources – how realistic is a macro or global grid? Would something like the Green Grids Initiative-One Sun One World One Grid (GGI-OSOWOG), jointly launched by the British government and India at COP26[^26], ever see the light of day? As I mentioned before, the answer is most likely a big no given the incredible amount or resources required for building all of the high voltage lines required, the political challenges and agreements required between different states and countries, as well as the cost and time it will take.
Microgrids: Why size doesn’t matter for energy generation
So, if macro-grids are so challenging, does that mean microgirds are the way forward? Let’s take a look. Microgrids’ advocates think we should focus our efforts in building decentralized, smaller-sized networks. One of their major arguments is cost. First, you won’t need to squander billions for setting up endless monster cables. But you also don’t have to worry as much about energy getting lost in transmission. That’s because you lose a sheer amount of energy on the very long way between a power plant and your plug. Out of the energy dispatched in the US between 2016 and 2020, 5% never made it to its final destination.17 Microgrids can sidestep that issue.
Also, with rooftop solar panels and other small-scale electricity generators getting cheaper, microgrids have become an attractive option, especially for remote communities.18 When considering a solar-plus-battery microgrid, its levelized cost of electricity (LCOE) can be up to $150/MWh. However, when integrating pumped storage hydropower (PSH), you could push it down below $100/MWh19, which is slightly lower than the LCOE of the US grid, projected to be $115/MWh in 2030.20 When you scale microgrids up, you’ll have a higher overall upfront cost yet a cheaper energy generation cost. For instance, a 1-MW solar installation would have a lower cost per unit of electricity than a 50-kW solar array.21 On the other hand, some microgrid configurations could be more competitive than macro-grids. A recent analysis conducted in Rwanda found a grid-connected solar-plus-battery microgrid could have a 4x lower LCOE compared to that of the residential electricity.22
Which leads me to the elephant in the micro-room: climate change. Being able to function off-grid, local freestanding systems will increase the climate resiliency of our energy supply. Which is a key point with more frequent heat waves and storms cutting off our power. For instance, solar-plus-storage microgrids reconnected some of the Puerto Rican communities isolated by Hurricane Maria in 2017.23 Thanks to the backup power, local people could use washing machines, refrigerators and other basic electrical outlets. Besides being safer, this microgrid model could deliver cheaper electricity to Puerto Rican consumers compared to that provided by the run-down macro-grid.24 To add to that, AI, machine learning and smart software will ease the integration of low-carbon distributed energy sources like rooftop solar, batteries, virtual power plants, fuel cells and electric vehicles (EVs) within the microgrid. And stand-alone networks can also support the larger grid when connected to it. That’s because a microgrid can work as either a storage unit or a power source depending on energy fluctuations. Looking at the bigger picture, a modular architecture featuring several interconnected yet autonomous microgrids would be more failure-proof than a centralized infrastructure. Overall, the achievement of decarbonization targets, a demand for stable supply, lower costs of solar and batteries, and rising cyberattacks25 on macro grids will drive the microgrids growth in the future. Based on a forecast analysis, microgrids’ market will grow at a CAGR of 11.4% over the next five years, reaching a value of $42.3 billion by 2026.26
Ending the renewable battle to win the decarbonization war
So, do we have our winner? Much like most of the technologies I talk about on the channel, there’s not necessarily going to be one winner, or one right choice. While one, giant, harmonious macro grid is unlikely to happen because of all the challenges I went over, it doesn’t mean the smaller more regional macro grids don’t make sense, like what Xlinks is trying to pull together. But microgrids require fewer political hurdles, suffer far less energy loss in transmission, and can be quick and affordable to roll out. While microgrids are the more likely path to get us to our clean energy targets the fastest, both will play a pivotal role in the decarbonization of our electricity. More investments and technology advancement might make more projects like Xlinks’ become a reality, but if that takes too long, it may turn out we’ve largely found our answer with microgrids. Ultimately, if we want to win the war against climate change and produce a more reliable, resilient, and cheaper power systems, this micro-macro battle should end with them joining forces.
- “How Does the U.S. Power Grid Work? | Council on Foreign Relations.” 14 May. 2021↩
- “A national US power grid would make electricity cheaper and cleaner.” 20 Jun. 2020↩
- “Future cost-competitive electricity systems and their impact on US ….” 25 Jan. 2016↩
- “Power from the Prairie aims to link West Coast sun with Midwest wind.” 24 Nov. 2020↩
- “Why Does the U.S. Have Three Electrical Grids? – IEEE Spectrum.” 14 Oct. 2020↩
- “The Problem with Solar Energy in Africa – YouTube.” 23 Oct. 2021↩
- “Benefits of High-Voltage Direct Current Transmission Systems.” 1 Aug. 2018↩
- “What’s A Macrogrid? | T&D World.” 12 Apr. 2021↩
- “Microgrids vs. the Macrogrid – All About Circuits.” 2 Jun. 2019↩
- “Spain’s third interconnection with Morocco could be Europe’s chance for African PV – or a boost for coal”↩
- “Morocco-UK Power Project – Xlinks.”↩
- “Global Horizontal Irradiance (GHI) – HOMER Energy.”↩
- “The North Atlantic Trade Winds: a steady planetary force.”↩
- “Renewable Baseload Power from a single desert location. Enough ….” 17 Oct. 2021↩
- “What is a Contract for Difference and why do we need it? – EMR ….”↩
- “UK Power Is So High That EDF Hinkley Reactor Looks Good Value.” 30 Jul. 2021↩
- “Meet the microgrid, the technology poised to transform electricity – Vox.” 24 May. 2018↩
- “The cost of Electricity with Solar & Battery Microgrid.” 4 Sept. 2020↩
- “What Does a Microgrid Cost?.” 26 Apr. 2016↩
- “Comparative Analysis of Reliable, Feasible, and Low-Cost … – Hindawi.”↩
- “Solar Plus Storage Microgrids Bring Relief to Puerto Rico.” 27 Feb. 2018↩
- “How to Harden Puerto Rico’s Grid Against Hurricanes – IEEE Spectrum.”↩
- “US Energy Information Administration (EIA).”↩
- “Future cost-competitive electricity systems and their impact on US ….” 25 Jan. 2016↩
- “Experts see ‘unprecedented’ increase in hackers targeting electric grid.” 13 Apr. 2021↩
- “$42.3 Bn Microgrid Markets by Connectivity, Offering, End Use ….” 2 Sept. 2021↩