Zhaoyu Wang is working on creating Iowa’s first microgrid in a rural community – Montezuma.

A microgrid is a small-scale power system featuring power generation from solar panels and a battery storage system. Wang is the project leader and a professor of electrical and computer engineering at Iowa State University. He is also affiliated with the university’s Electric Power Research Center. 

The microgrid can be separated from the main grid of power, he said. 

“It’s self-sufficient,” Wang said. “That is the uniqueness of the microgrid.”

Iowa State and the Montezuma utility Montezuma Municipal Light & Power submitted a proposal requesting a federal investment of roughly $9.5 million and a local cost-share of $2.4 million from university and Montezuma sources for a total of $11.9 million, the February 2024 announcement said. Wang said he’s received $650,000 in funding so far for the first budget period of the project, with federal funding at $520,080 and the cost share at $130,020.

Then-U.S. Secretary of Energy Jennifer Granholm announced 17 projects in total, which were all part of the Energy Improvements in Rural or Remote Areas program managed by the U.S. Department of Energy’s Office of Clean Energy Demonstrations.

The benefits of a microgrid in Iowa can be linked to the derecho of 2020, when many people lost their electricity for hours, days, or even weeks, Wang said. Those people relied on the main grid for electricity to their homes.

“If the main grid is down, there’s nothing else they can do,” he said. “But if you have the microgrid, because of its local generation capability, we can form this island, and we think that island still has electricity – not from the main grid but from the local generation.”

If there’s another derecho, the 1,400-person town of Montezuma will still have electricity.

“There’s no outage. … That’s the usefulness of this microgrid,” he said.

Wang said this project can serve as an example and show Iowa the advantages and disadvantages of a microgrid.

He said the microgrid’s benefits to business are clear.

In Montezuma, there are two large manufacturing plants, plus many local resident-owned small businesses, Wang said. 

“You have a high reliability … you still have power that’s important to your business,” Wang said. “If you are manufacturing something or running a hotel or running a restaurant or grocery store, that’s a daily necessity. We believe this microgrid can supply resilient and reliable power to local businesses, even during extreme [events] to continue that power supply.”

He said local businesses can also benefit, because the microgrid will stabilize the local electricity rate.

“Having this price stability is also important,” he said. “Otherwise you are facing this price hike in the future that will hurt your business profits.”

Wang said the project team, which includes Anne Kimber, director of Iowa State’s Electric Power Research Center and a project co-leader, and Kevin Kudart, the superintendent of Montezuma Municipal Light & Power, is in the first phase of the project, which started in December 2024 and is mostly focused on engineering and design.

The second phase is construction and will “hopefully” start in December of this year, he said.