The New York Times, October 8, 2013
LONDON — For nearly a century, wealthy countries have relied on just one model of power distribution: sending electricity over huge transmission grids from big generating plants to customers in their homes, offices and factories.
That may be starting to change. Renewable-energy technologies like solar and wind power, which in many countries have begun to shake up the mix of energy sources, are now also challenging the traditional distribution system.
Advocates of a decentralized approach, known as distributed generation or distributed energy, envision a day when grids will no longer be one-way systems.
Thousands of small generators, including rooftop solar panels and facilities that extract energy from garbage or sewage, could feed into the system, replacing or complementing big coal, nuclear or natural gas plants, they say.
“It’s a real paradigm shift,” said John Farrell, energy expert at the Institute for Local Self-Reliance, a research and advocacy group based in Washington and Minneapolis. “It’s not only a shift in the physical generation of power, but also the power over the system in terms of who is in control of it and who can benefit from it.”
Some energy experts say a less centralized system would be better suited to the diverse mix of energy sources that is likely to be needed to reduce climate-warming carbon emissions.
Some experts, though, have doubts about the viability of distributed generation as a major contributor of power. Making haphazard changes to a system as complex as the electrical grid could have unintended consequences, says the association representing much of the American utility industry, which could lose revenue through decentralization.
Small, decentralized generators are mostly inefficient, costing far more per unit of output than conventional power or even utility-scale renewable energy, like big solar farms, said Richard McMahon, vice president for energy supply and finance at the Edison Electric Institute, the association that represents the biggest American power companies.
Without careful pricing and regulation, he said, an overexpansion of distributed generation could drive up electricity prices and unfairly shift costs to customers who cannot afford to produce their own electricity.
Precise estimates are hard to find, but Mr. Farrell said between 1 percent and 2 percent of American power is now generated by decentralized, renewable sources.
Germany, which aims to remake its energy system completely and to rely almost solely on clean sources by 2050, has been a leader in decentralizing.
Germany’s “feed-in tariff,” a guaranteed price per kilowatt hour, has helped drive widespread installation of solar panels around the country, said Craig Morris, lead author at Energy Transition, a Web site focused on the German overhaul. “Because of that, all of this has really gone wild, and it’s really been driven by citizens,” he said.
Still, there have been some unforeseen consequences. German electricity prices have skyrocketed while carbon emissions have actually increased as oil- and coal-powered plants have fired up to fill gaps in the incomplete new system.
That should be a warning for the United States, said Mr. McMahon of the American utility association.
Yet whatever the potential downside in converting existing systems in developed countries, distributed generation could be hugely transformative in less developed nations in Asia, Africa and elsewhere, where energy demand is growing rapidly.
Countries without well-developed power systems could simply skip over centralized grids and go straight to installing dispersed generators, in the same way that many poor nations leapfrogged landline telephones and built mobile phone networks instead, Mr. Farrell said.