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Electricity is the key energy source for individuals, homes, businesses, governments, and all of the utilities and services on which they rely. Demand for electricity continues to grow, even as consumption in many developing countries begins to drop. To meet growing demand, as well as meet environmental challenges and reduce existing inefficiencies, an outdated and decentralized grid management provides new ways of delivering and consuming electrical power and is being explored. Such an approach requires DC microgrids or nanogrids to become a key part of the electricity distribution network. This report examines the concept and potential for residential microgrids, as well as the key regional, market, and technology drivers for their development. It also considers issues that require addressing in order to further their adoption.