A microgrid is a small-scale power grid that can operate independently or in conjunction with the area’s main electrical grid.
Any small-scale localized station with its own power resources, generation and loads and definable boundaries qualifies as a microgrid. Microgrids can be intended as back-up power or to bolster the main power grid during periods of heavy demand. Often, microgrids involve multiple energy sources as a way of incorporating renewable power. Other purposes include reducing costs and enhancing reliability.
The modular nature of microgrids could make the main grid less susceptible to localized disaster. Modularity also means that microgrids can be used, piece by piece, to gradually modernize the existing grid.
The practice of using microgrids is known as distributed, dispersed, decentralized, district or embedded energy generation.
See a video about the microgrid at the University of California at San Diego: