Outside the Floodplain

What Is It?

Cost: $1M-$2.5M (MassCEC data for 5 MW Multi-DER Installation).
Applications: Retrofitting or new construction. Works best on MUSH (municipality, university, school, healthcare) property types.
Service Life: Indefinite with regular maintenance and repairs.

Microgrids are small-scale power networks capable of operating in conjunction with the larger grid and/or working separately, known as islanding. In a macrogrid, utilities supply extensive areas and municipalities with power distributed from a series of generators. Microgrids operate similarly, but on a local scale; they provide a series of customer loads with power from distributed generators cited within the microgrid. These grids can allow for competitive pricing relative to the grid,  increased energy efficiency, and resiliency in the case of a power outage.

By reducing the distance between providers and consumers, microgrids cut down on energy loss, which saves money and reduces emissions. Because of the increased efficiency, microgrids can be more economically viable for both energy producers and consumers.


  • Increased resiliency in the case of an emergency: the microgrid is capable of islanding and continuing to provide power to its customers.
  • Creates safe havens in the event of a larger-scale power outage.
  • More energy-efficient; reduces the need to transport electricity over a long distance which leads to energy loss.
  • Excess power can be sold back to the macrogrid.
  • Economically viable with a short payback time.
  • Pricing can be competitive with grid power, making it cheaper for microgrid customers
  • On campuses such as hospitals or colleges, microgrids are a tried and true alternative energy model.


  • Legal challenges do exist for multi-user microgrids, and vary substantially by state and energy market.
  • Not always a better environmental choice. Environmental benefits depend on the type of fuel used for generation.
  • Requires new electric infrastructure, which is difficult to establish in areas with highly developed electric grids.
  • High initial cost.
  • Uncertainty of revenue in public setting, as they have not been extensively tested in multi-user applications.

Regulatory Impacts and Requirements




Financing Options, Incentives, And Rebates

  • Federal tax credits from energy production, which are of higher value if a portion of the generation comes from renewables.
  • Private revenue: income from selling energy to consumers and the macrogrid.
  • Accelerated Depreciation for Smart Meters and Smart Grid Systems – This act allows taxpayers to recover the cost of this property over a 10-year period instead of the standard 20-year period, unless the property already qualifies for a shorter recovery schedule.
  • Mass Save offers custom incentives for construction of new systems that go above and beyond regulatory requirements.
  • Community Clean Energy Resiliency Initiative– Massachusetts awards grants to municipalities that use technology and clean energy systems to prevent service interruptions.

Additional Resources



*Indicates Boston-area supplier


Photo credit: NTT Facilities, Wikipedia