General Electric has won a $2 million federal stimulus grant to work on a smart grid project – but it isn't from the Department of Energy.

Rather, the funding comes from the Department of Defense to build a "microgrid" at its Marine Corps base in Twentynine Palms, Calif., GE reported Wednesday.

The idea is to give the base a "smart energy management system" that combines on-site power generation, energy storage and monitoring and control systems to make the entire base use power more efficiently.

GE has developed a microgrid controller to manage the complex interactions that such a system will require, allowing the base to both function as an isolated unit, making and using its own energy, and to interact with the larger-scale grid it's connected to.

The idea of a self-contained grid is doubtless attractive to the military, given its need to keep bases powered in every contingency. But it's also seen as a potential way for utilities to integrate energy storage systems and renewable power sources like solar and wind at manageable scales.

Duke Energy is working on a microgrid pilot project in its headquarters city of Charlotte, N.C., involving a 50-kilowatt solar panel array, a 500-kilowatt zinc bromide battery to store power, and about 100 homes linked up with home energy management systems that communicate with the utility (see Integral Analytics: Orchestrating Duke's 'Virtual Power Plant').

Another microgrid project called FortZED (for Fort Collins, Co. Zero Energy District) is underway in Fort Collins, Colo.. That one is funded by the Department of Energy (see Green Light post).

There may well be other microgrid projects seeking funding from the $3.9 billion in smart grid grants the DOE plans to start awarding this year (see DOE Issues Rules for $3.9B in Smart Grid Stimulus Grants).