In the Americas, microgrid growth is clearly stretching north and south of the US border.
Particularly interesting is the volume of microgrid and distributed energy projects in Canada.
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This looks like a big shift from a few years ago. Shortly after the Inflation Reduction Act passed, I attended a decentralized grid conference in Canada and was struck by the defeated mood of the presenters. While we in the US were celebrating, they were despondent over how much harder the IRA had made it to compete with the US on clean energy and electric vehicles.
It’s probably safe to say that’s no longer the case.
Microgrid growth in Canada
Spring Lane Capital’s recent announcement offers an example of animation in Canada’s market.
With offices in Boston and Montreal, the private equity firm is investing CA$100 million in Canadian distributed energy projects as part of a partnership with AltCrest Energy, a Toronto-based developer, and Development Engine Partners.
In many ways, Canada looks like the US, with demand for power growing from data centers, onshoring of manufacturing, and electrification. But there is one big difference, as Jason Scott, partner at Spring Lane Capital, points out:
“The Canadian government continues to support the growth of renewable energy systems from a policy perspective, making Canada an attractive market to operate and deploy capital.”
It’s a pretty straightforward example of favorable government policy attracting investors.
The joint venture will focus on rooftop solar PV, geothermal, microgrids, and battery energy storage systems for institutional real estate owners and large corporate entities, using an energy-as-a-service model. The joint venture funds 100% of the development and construction costs, sparing building owners from paying upfront capital, while offering a hedge against rising grid energy prices
South of the US
Meanwhile, BNAmericas reports growing interest in microgrids in Chile, Argentina and Peru, with the mining industry as a key driver. Given the choice between a microgrid and the expense of a transmission line, they choose the on-site solution.
“This is something that wasn’t considered before,” said Marco Zazzini, deputy CEO of Chile-headquartered regional energy consulting firm Anabática Renovables.
The projects tend to be solar, storage and fossil fuel backup generation.
Meanwhile, in Mexico interconnection requests for distributed generation are skyrocketing, doubling over five years to reach 558,000 in 2025.
