Background The U.S. Lawrence Livermore National Laboratory estimates that, 53 % of the energy used worldwide in 2006 could be classified as waste heat, providing no useful services. Other calculations show far higher losses. Moreover, the United States is estimated to operate at only about 13% useful-energy efficiency, up from 10%. Even in Japan, a worldwide efficiency leader, the rate at which primary energy actually provides useful work or heat is only about 20%. Such waste poses a great obstacle to reaching the objectives on energy efficiency, renewable energies and CO2 emissions set out in European and national legislations. The European Commission’s communication, ‘A Roadmap for moving to a competitive low-carbon economy in 2050’, suggests that industry must reduce GHG by 34-40% by 2030 and by 83-87% by 2050 (compared with 1990 figures). Microgrid systems are localised groupings of electricity generation and energy storage that are normally connected to a traditional centralised grid. This single point of common coupling with the macrogrid can be disconnected, allowing it to function autonomously. Microgrids are able to reduce transmission losses and increase the efficient use of electricity and heat. Generation resources for microgrids can include fuel cells, wind, and solar, among others. Objectives The main objective of the LIFE FACTORY MICROGRID project is to demonstrate that microgrids are a viable means of generating electricity for industry, especially in areas with a high share of renewable energy sources. To achieve this objective, the project aims to: Install renewable energy sources: a 100 kW wind turbine and a 40 kW solar photovoltaic device; Install a novel technology of ZnBr (Zinc/Bromine) flow batteries to store 500 kWh of electricity. These batteries have several advantages over conventional Li-ion (Lithium ion) batteries in terms of economies of scale and system lifetime; Install six bidirectional charging points (V2G) to be used for a fleet of six electric vehicles (three cars, two vans and one minibus); Establish one fast charging station for electric vehicles with a power of 50 kW; and Test and demonstrate energy management strategies that use all the renewable energy generated and reduce energy consumption by managing dispatchable loads of up to 100 kW. Expected results: Generation 56 215 kWh/year free of CO2 due to the installation of 40 kWp of photovoltaic panels; Generation of 103 323 kWh/year free of CO2 due the installation of 100 kWp of wind turbine; Store of energy and management of energy flows in order to consume all renewable energy generated, saving 35.4 million tonnes of CO2 emissions; Saving of 38 million tonnes of CO2 emissions by using electric vehicles as part of the microgrid; Reduction of energy consumption due to energy management of 100 kW of dispatchable loads, allowing a reduction of 23 million tonnes of CO2 emissions per year; and More grid stability, allowing for an increase of renewable energy generation to more than 40% by 2020.