Distributed Energy Generation – The New “Internet”


Distributed Energy Power Station

The Internet revolutionized the world of computing – it took us from a world of large centralized mainframe computers with terminals attached to a world of any-to-any connectivity. The Internet evolved from a military need for survivability; by having a mesh of network nodes that could instantly re-route traffic around outages, it could sustain failures but continue to perform. Distributed generation, referred to as “DG” in industry speak, is essentially the “Internet of Energy” by producing electricity from many small energy sources.

Historical Perspective

Power plants over time were sited further and further away from  consumers for a number of reasons:

· Coal fired power plants – were situated away from the cities to cut down on pollution in populated areas and to cut down on the cost of transporting the coal.

· Hydroelectric – obviously had to be located near the source of water power.

· Nuclear power plants have also suffered from NIMBY (not in my back yard).

This created challenges of delivering the electricity generated in the centralized plant to the consumers. Our antiquated electric grid is the means by which this is accomplished – and in implies tremendous costs surrounding the installation of transmission lines – expenses that could be saved and applied towards expensive locally generated technologies. The problem with large scale renewable plants is that even today, power is regional; according to Dr. Wade Adams of the Smalley Institute, “The average reach of today’s grid is closer to two hundred miles, maybe double that. So you aren’t currently able to ship energy from sun-rich Arizona to New York City.”[1]

New Reality

With the proliferation of solar and wind the seeds have been planted for distributed generation. However, in most cases even with these renewable sources, connection to the grid is necessary. As the sun doesn’t always shine and the wind doesn’t always blow an external source of power will be needed, unless and until you can store your excess generated electricity to draw down later. Follow this link to view such a set up at Slippery Rock Macoskey Center, and you can see from where they are obtaining their power. When I first viewed this site it was all coming from the grid because it was cloudy and the wind was only blowing at 10 MPH.

The Future

We started off with a discussion of the Internet, so what’s the connection? Well, as more and more solar, wind, and even small hydro are deployed several things come into play.

· There is a reduced demand for electricity from a central site that can slow the growth in these plants that today mostly rely on fossil fuels

· There is the opportunity to use the excess power generated from these distributed renewable sources later via storage on site or by feeding it back into the grid

· With the proper interconnections, there is an opportunity to reduce or eliminate blackouts on the massive scale we have seen several times in the Northeast, and rolling brownouts that we saw in California at the time of the Enron debacle.

What are some of the challenges?

Smart Grid: Our underlying infrastructure is key – unless we upgrade to a smarter grid, we may have thousands of energy islands, but not much shared benefit. Think of the PC revolution in the early 1980s before the Internet, only you can’t put your excess energy on a floppy disk and carry it to your neighbor (with fuel cells, batteries and other energy storage devices, perhaps one day you will be able to do just that).

Cost: Organizations like “1 Block off the Grid” are trying to address these concerns but “the economic reality [is]that small-scale distributed generation is typically much more costly, on a per-kilowatt-hour basis, than economy of scale central station generation.”[2]

Legislation: Third, there has to be some regulatory framework under which all of this can work so that the utilities and the distributed generation sites can work cooperatively, and each have their rights protected.


[1] Ron Pernick and Clint Wilder, The Clean Tech Revolution, The Next Big Growth and Investment Opportunity (New York: Harper-Collins, 2007), p. 168

[2] Larry Kellerman, one of the nation’s top utilities experts, who works for Goldman Sachs and runs its power generation subsidiary. Quote from: Thomas L. Friedman, Hot, Flat and Crowded, Why We Need a Green Revolution – And How It Can Renew America (New York: Farr Strauss, and Giroux, 2008) p. 287, 289


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