The paper discusses the concept of a microgrid, which is a small-scale power system consisting of distributed energy resources and loads that can operate in parallel with or independently from the traditional utility grid. It describes how microgrids allow integration of various distributed energy resources like renewable energy sources, storage devices, and controllable loads to operate as a single controlled system that provides both power and heat to its local area. The paper also examines some technical challenges in planning, protection, and control of microgrids.