Quick take: Whenever a technology is slow to develop in North America, proponents often look to China for faster growth. But microgrid supporters looking to China for easy expansion may be disappointed, according to SGT Research, a Chinese market research and advisory firm. – Jesse Berst

On the plus side, there are many microgrid demonstration projects in place or under construction along with numerous microgrid companies. For instance, the Chinese National Energy Administrator (NEA) plans to build 30 microgrid projects during the period of the 12th Five-Year Plan. In addition, NEA will also release standards and regulations for distributed generation and microgrids in the near future, which could help promote the concept. The Chinese see microgrids as a way to buffer the impact of renewable generation on the main grid.

On the downside, this emerging market has already sunk "into China's unique policy shackles," warns the report. One challenge is opposition from China's uber-powerful State Grid Corporation. "The microgrid is a sensitive topic in the industry in China," the report explained. "A person from the State Grid exposed that microgrid, on one hand, adds instability to the power network, on the other hand, the distributed generation will reduce utility’s electricity sales and then affects the interests of the State Grid."

The Director of the State Grid Energy Research Institute has gone so far as to proclaim that the only value of the microgrid is in remote areas which are beyond the reach of large power grids.

Nevertheless, pilots and research continue at a rapid pace. Much of the current research is devoted to three key technical issues: 1) rapid isolation from the existing grid, 2) seamlessly switching between grid-tied mode and isolated mode, and 3) microgrid internal stability control.

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Jesse Berst is the founder and chief analyst of Smart Grid News.com, the industry's oldest and largest smart grid site. A frequent keynoter at industry events in the U.S. and abroad, he also serves on advisory committees for Pacific Northwest National Laboratory and the Institute for Electric Efficiency. He often provides strategic consulting to large corporations and venture-backed startups. He is a member of the advisory boards of GridGlo and Calico Energy Services.