The average roof of a large retail store like Walmart spans a massive 180,000 square feet—roughly the size of three football fields. There are over 100,000 superstores in the U.S. with nearly 7.2 billion combined square feet of rooftop space, equivalent to the entire city of El Paso, Texas. According to an Environment America study, filling these vacant spaces with solar modules could generate enough power to supply nearly 8 million homes—roughly the power needs of 35 cities the size of El Paso—and would avoid emissions equivalent to removing over 11.3 million gas-powered cars from the road.
By installing solar modules on their underutilized roof space, facilities managers at superstores could offset up to half of their annual electricity consumption. Parking lots represent another untapped solar power resource: A typical 200,000-square-foot superstore requires a 300,000-square-foot parking lot. The average large retail franchise has nearly half-a-million square feet—or more than 11 acres—of underutilized surface area composed of roofs, parking lots, and undevelopable land. Adding solar modules could generate over 2 megawatts (MW) of electricity, enough to power hundreds of homes.
Installing solar modules on these superstores benefits businesses, consumers, the electrical grid, and the planet. So, why isn’t it happening more?
Installing solar requires a significant upfront investment. However, the power generated by these installations, in combination with other distributed energy resource (DER) components like battery storage, a generator, and smart controller, creates a microgrid that provides stability and resilience, benefiting not only retailers but also the surrounding community.
Microgrids can enable specific retail facilities, like grocery stores, to meet their specific energy requirements. Grocery stores have high energy needs due to the amount of refrigeration and HVAC required, so lowering energy costs can result in substantial savings for the business. Food spoilage during a power outage can result in added expenses and lost revenue, but microgrids can provide full resiliency to maintain critical activities such as lighting, security, HVAC, and refrigeration. Furthermore, green energy can be a strong narrative for customers who want to see their favorite retailers doing more to reduce their carbon footprint.
As opposed to direct ownership, facilities managers at large retailers can access the benefits of microgrids with no upfront costs through a model known as Energy as a Service (EaaS). More details below.
What Is a Microgrid?
A microgrid is a localized electrical system that can operate independently or be connected to the utility’s electrical grid. The DER components work together to power a finite area such as a building, campus, or neighborhood. Microgrids ensure reliable electricity even during power outages, acting as self-contained power systems.
Microgrids provide renewable energy rates 10-15% lower than what utilities can offer. In addition, smart controllers and energy management software can further enhance savings, especially during peak demand times. Microgrids are more than just cost-saving tools; they are revenue-generating assets that may enable you to sell excess energy back to the grid and provide services such as frequency regulation and smart demand response. Microgrids also contribute to your organization’s sustainability goals, as energy savings and the renewable electricity generated can be counted toward your organization’s clean energy procurement and decarbonization targets.
Microgrids are an effective way for large-footprint facilities to secure energy independence and reliability, particularly for regions affected by extreme weather events. When the power goes out, microgrids enter “island mode” and temporarily disconnect from the electrical grid, allowing operations to continue during grid disruptions. With battery backup and generators, microgrids can empower facilities to maintain critical services even during multi-day blackouts—increasing revenue. Beyond economic benefits, actively supporting the community during times of crisis sets a company apart, helping to build trust and attract and retain loyal customers.
Microgrids are capital-intensive, and have traditionally been the prerogative of those privileged with the financing and knowledge required to develop and maintain microgrid infrastructure. With an EaaS model, however, facilities managers do not have to invest capital, but have the ability to purchase energy at a discount through a long-term power purchase agreement.
What Is EaaS?
Today, innovation moves quickly, and the energy landscape is being redefined by AI-enhanced smart digital controllers, enabling decentralized and resilient energy networks capable of responding to real-time load demands. The digitization of energy has opened the door for EaaS, an operating framework where customers pay for energy solutions as a service, much like a software subscription. In an EaaS model, a service provider shoulders the burden of energy infrastructure development, construction, operations, and maintenance, eliminating the need for businesses to own or manage energy infrastructure, reducing upfront capital expenditure, and allowing them to focus on their core business activities.
Microgrids and EaaS: The Perfect Match
Recently, microgrids coupled with EaaS have become increasingly popular as electricity prices continue to rise, extreme weather events become the norm, and renewable energy systems grow more efficient. EaaS offers businesses a smart way to access sustainable energy that may have been out of reach or out of scope.
Microgrids in the EaaS model have advantages for the energy-intensive operations of large retail facilities. EaaS requires no up-front costs to the facility, as the service provider installs, owns, and operates all of the microgrid components—the customer only pays for the energy they use and at a discount to their current energy rate. Cost savings are achieved by adding solar, which also reduces the customer’s carbon footprint. The addition of battery storage further reduces energy costs and improves efficiency while generators provide resiliency when grid power is unavailable.
Conclusion
Increasing power demand, underinvestment in the nation’s transmission and distribution network, and increasing extreme weather events will all lead to increasing power outages. Microgrid technology offers a path to energy independence and resiliency, helping facilities managers effectively navigate the dynamic energy landscape through bespoke projects using DER components, like microgrids.
Organizations can reduce costs, lower their carbon footprint, and gain a competitive edge in an increasingly energy-dependent market. As the energy landscape continues to evolve, microgrids using an EaaS model stand at the forefront of innovation, providing a blueprint for the future of reliable power generation and delivery.
Kirk Edelman is CEO of SolMicroGrid, a portfolio company of Morgan Stanley Energy Partners and a developer and operator of solar-enabled microgrid systems for commercial and industrial customers.