by Chris de Morsella, Green Economy Post Chris is the co-editor of The Green Executive Recruiter Directory. Follow Chris on Twitter @greeneconpost

Distributed energy systems can range from the micro sized do it yourself systems being installed on rooftops and on hilltops to small scale systems ranging up to around 20MW (megawatts) of capacity, although it must be understood that this is a pretty fuzzy boundary. The defining characteristic of distributed energy systems is that they generate energy close to the point of use where that energy will be consumed; hence the admittedly fuzzy 20MW upper boundary for their size. If an energy generation facility becomes much larger than this it produces far too much power to be consumed locally (except in a few rare exceptional cases where large industrial consumers are nearby). The excess power must then be transmitted to distant markets and the energy system can no longer be described as being a distributed energy system.

Besides being relatively small scale distributed energy systems are usually understood to be powered by renewable energy sources such as solar or wind, but also biomass or other systems such as tidal, wave and geothermal and that to put it another way they do not rely on fossil energy supplies. Many however also include micro-turbines, fuel cells and the more traditional gas or diesel powered backup generators in this category by virtue of their small scale.

Some Advantages of Distributed Power Systems

Distributed electric energy systems offer many advantages over the current energy topology of a smal number of massive thermoelectric fossil fueled power producing plants that feed a vast grid with essentially a uni-directional flow of current through a whole series of transformer sub-stations that both step voltage up then step it down along the way to the consumer at the far end of the very long pipe.

  • It is suited to regions currently lacking well developed and maintained grid infrastructures. This is the case in much of the less developed world, but also includes remote areas in the US and other industrialized nations.
  • By off-loading demand from the grid it can reduce or avoid the necessity to build new transmission/distribution lines or upgrade existing ones.
  • They can avoid the line loss associated with transmitting electricity over long distances and in the process of stepping voltage up and then down in transformers in order to put power onto these very high voltage transmission systems and to pull it down off from them before being able to use it.
  • Because of its smaller scale it avoids the large increment problems faced by large scale utility sized plants of Gigawatt scale. In other words it can more smoothly fit actual current use patterns and can be installed in easy small increments as needed and does not tie up massive long term capital for a single project.
  • Because it is easy to bring small scale distributed systems on and off line when compared to large thermoelectric plants they can function as backup and emergency power sources and help prevent blackouts and brownouts.
  • Distributed systems (such as hydro, or biomass, but also micro-turbines, fuel cells etc.) can be configured to produce power during peak load times when the grid is under its greatest stress and energy is most costly.
  • Distributed systems are well suited for and promote the diversification of power supplies, which makes them particularly suitable for renewable energy sources.
  • By virtue of their smaller scale distributed energy systems are more suitable for co-generation. Co-generation uses the waste heat from a one process, such as power generation, to provide space heating for buildings. Small biomass, micro-turbine, fuel cell, or combined solar facilities are naturally suited to also being sources of co-generated heat. Heat that would otherwise need to be produced by some other means.
  • Last, but not least, distributed electric energy systems can help to make our country more secure. Because they are widely dispersed and do not depend on a small number of central facilities they are much less vulnerable to disruption – either through accident or hostile action. Distributed electric energy systems are inherently more survivable than a centralized grid relying on a very small number of fixed facilities and key transmission nodes.

The System We Have

Our current electric energy infrastructure is characterized by massive thermoelectric plants, mostly fired by burning mountains of coal but also by the heat released through nuclear fission. These plants are typically massive driven by economies of scale to reach up into the Gigawatt capacity order of magnitude. Our entire grid system is characterized by this centralized power infrastructure. Of course it is true that a small amount of energy comes from renewable sources– around 6% of the total electric energy generation comes from (often massive) hydro-electric plants and currently a little less than 1% from wind power — but our energy infrastructure is mostly dominated by massive thermoelectric plants with coal burning plants comprising almost half of the nations electric energy generation capacity.

This has lead to a grid structure of correspondingly massive scale and of a similarly centralized nature. But will it always be so? Are we destined to continue down a path of massive power plants feeding a highly integrated grid with power that needs to stepped up to very high voltages for long distance transmission then transformed down in stages until it finally reaches the industrial facility, home, or commercial building where it is ultimately consumed. Is this way of doing things really suited to the nimble and diversified future that awaits us just around the corner of the curve of diminishing fossil energy reserves and spiking costs as increasingly marginal fossil energy supplies are developed to feed our future energy needs?

Recent Trends Seem to Indicate that Distributed Power is Finally Taking Off

Distributed power may finally be taking off, driven by the continued rapid drop in the cost of renewable energy sources, by the increasing incidence of brownouts and blackouts in an over-taxed grid, by the inability of the grid to adapt to future needs, by a desire amongst many to exert more control over their how they get their power and by a growing awareness of global warming.

Solar Energy Sector

A recent report by Pike Research that is focused on the growth in small scale distributed solar photovoltaic power systems predicts that the global market for these systems, which is currently at $30 billion per year (2008 figures) will grow to almost $60 billion by 2013. That is a compound annual growth rate of 22%. Of all the opportunities in PV, Pike Research finds that the most compelling growth potential lies in decentralized electricity generation, whether in small rooftop or large commercial installations. Solar PV has the advantage of being truly modular, which makes it particularly well suited for distributed energy systems.

In addition the modular small scale solar thermal systems suitable for distributed power systems are also taking off. For example Sterling Energy Systems a solar company based in Scottsdale, AZ has recently released an the production design of its SunCatcher system that is a solar thermal dish system that uses concentrated solar energy to run a high efficiency sterling engine. This system has been in development for ten years. Each dish unit can generate 25 kilowatts of energy and has been certified by Sandia National Laboratories as having the highest sun‐to‐grid energy conversion in the world; last year one of the original SunCatchers set a new solar-to-grid system conversion efficiency record by achieving a 31.25 percent net efficiency rate, toppling the old 1984 record of 29.4

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Stirling Energy Systems in partnership with Tessera Solar are building a 1.5MW field Peoria, Arizona. The modular nature of these types of systems makes it a good fit for smaller scale and more widely dispersed distributed solar generating systems, because they are easily scaled to fit current energy market conditions.

The Wind Energy Sector

According to a the Small Wind Global Market Study a study on the market for small wind turbines from The American Wind Energy Association (AWEA), the U.S. market for small wind turbines, which it defines as those with capacities between 20and 100 kilowatts (kW), grew by 78 percent in 2008. It must be said that the installed base is still very small – the total new capacity is a little over 17 megawatts (MW) – however the rate of growth is impressive if it can be sustained.

In the report manufacturers predict a 30-fold increase in the US market in as little as five years, even under current economic conditions. Primary drivers include the eight-year 30% federal investment tax credit enacted in October 2008, recent and potential private equity investment, and greater equipment manufacturing capabilities.


Distributed electric energy generation can help alleviate many of the critical problems facing our current over-taxed grid and avoid the need in many cases to lay down thousands of miles of new high voltage transmission lines. Distributed power as an idea seems sensible, especially in a post fossil world where power is gathered from low density and widely scattered variable sources, such as the wind or the sun. While there are some factors encouraging economies of scale – for example large turbines are more efficient than smaller ones – alternative energy seems well suited to a distributed energy topology typified by a large number of smaller scale facilities that are, in many cases, closely sited to consumers. In this manner power is delivered almost straight to the consumer and the grid becomes increasingly a kind of peer to peer power network re-distributing surplus power to regions of energy deficit – the grid as a more of a load balancer than a one way power pipeline from a few massive thermoelectric plants to the multitude of consumers.

© 2009 – 2011, Chris de Morsella. All rights reserved. Do not republish.

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Author: Chris de Morsella (146 Articles)

After a decade performing as a lead guitarist for rock bands, Chris de Morsella decided to return to the career his uncle mentored him in as a youth....Software Engineering. Since that time he has thrown himself into his work. He has designed a compound document publishing architecture for regulatory submissions capable of handling very large multi-document FDA regulatory drug approval submissions, for Liquent, a division of Thompson Publishing. At the Associated Press, Chris worked with senior editors at facilities around the world, to develop a solution for replacing existing editorial systems with an integrated international content management solution. He lead the design effort at Microsoft for a help system for mobile devices designed to provide contextual help for users. Chris also helped to develop the web assisted installer for LifeCam2.0, the software for Microsoft’s web cam and developed late breaking features for the product He also served with the Rhapsody client team to redesign and build a major new release of Real Networks Rhapsody client product. His most recent assignment has been Working with the Outlook Mobile Time Management team for the next release of Outlook Mobile for the SmartPhone. Chris' interests are in green building and architecture, smart grid, the cloud, geo-thermal energy, solar energy, smart growth, organic farming and permaculture. Follow Chris on Twitter.

  • Kellen Smith

    Mr. de Morsella,

    Great analysis; I sincerely appreciate your fact-based logic, as that practice usually [as in this case] leads to factual conclusions… unfortunately they’re a rare thing these days.

    It leaves me curious… how does the most fundamental 1st Law of Thermodynamics apply when it comes to our energy distribution systems?

    If you consider thinking spatially of a large wind turbine array in the midwest, with the kinetic energy of the wind that would continue if not for the turbine blades, spinning continuously to convert that energy eventually into our grid, and out of the natural energy system. [weather patterns?]

    What effect does that conversion out of the “natural” system into our designed-grid-system have on things like, for example, the weather patterns/jet streams in the Southeast? What ocean/river currents are altered due to the simple lack of energy in the system from its convergence by tidal generators… and all at what scales?

    There may or may not be a need to think of a natural energy system… but it seems to make sense, physically.
    If you might have an answer/synergy for any or all of the above, I’d appreciate your view.

    Thanks again for the logic in your report,

    Kellen Smith

    Student: Georgia Institute of Technology
    Ceo/Founder: []

    • Ger Groeneveld

      Considering large arrays of wind turbines, those need quite a bit of space in between to harvest the energy in a constant manner. About a 3 times the distance between the diameter of the blades at least. Otherwise the influence of the other wind turbine will decrease the possibility to get some power. Overall the energy taken away will be less than 9% of the potential. Furthermore the vertical area will be a minor part as well. of the 3000 m of air important for the weather, just 2% is taken. If air is restricted it will flow around the turbine a bit more. In total just some 0.018% will be used. That will not disturb any pattern.
      For solar applications, put on the ground, the covering up of the soil will hinder evaporation. In dry,sunny areas the evaporation will be a bit less, the converted sunlight will not be added as heat to the soil as well (at another place after transport) . So putting in vast amounts of solar panels into dry, arid areas will dampen the current climate shifts possible more, if put in the correct regions.
      For water, tidal waves, currents, the installations can not harvest all the energy, just like the wind case. Hydro-power could be used with small installations to dampen the effect of run off water from hills by removing a lot of the gravity energy causing landslides. Putting in forest is an other, likewise good way. Large hydro-power does have its effects because that does change the environment quite a bit and the flow of water. And if the water flows in such systems can not be handled properly (due to changing climate) the effects will be even worse.

      Climate change will happen. It already started. There is not a simple measurement to turn it back to the previous situation (before industrialization). Distributed energy generation will at least have less effect in the distribution of greenhouse gases, although not adding more, not generating the greenhouse gases at all at different places will be best. Solar power would be a solution but that is in 15 years with enough scale. Time to act now. So use what is available.

  • Chris Varrone

    DG is very interesting. Three questions:
    1) the Cost of Energy for DG seems to be MUCH higher (3x to 10x) than for centralized generation. Given this, does it really make sense for society? The subsidies for things like small wind and solar are enormous today – is that really sustainable? On the other hand, has anyone estimated the offsetting effect of lower transmission losses?
    2) while in some ways DG helps the Grid (by removing load), can a Grid with significant DG (20% say) really work electrically? How does it maintain sufficient Power Balance? These small machines cannot support the Grid (like large conventional or wind turbines can).
    3) given that DG is by definition located out in the fringes of the Grid, there is no Transmission System Operator (central utility) to manage the inflows/outflows – it is a Distribution System Operator (local utility). Can DSO’s manage this, technically, organizationally or in regulatory terms (i.e., that’s not their role as established post-liberalization in most markets around the world).

    • Ger Groeneveld

      1) Seems to be much higher. Not because of the capital cost but through the interconnection cost. Dont forget the savings on power transmissions, the better use of the grid when it does not need to be sized to the peak power requirements.
      2) A smart grid can. A Smart grid with electrical cars as battery back-up can do better. Many small machines can do the work of one big one although maybe less efficient. But on renewables that is not so much a point of concern now.
      3) Most grids are not capable of carrying the (future) load. Many people are already connected. But the grid is not capable of carrying the future amount of power. With an average load of networks around 40% of the peak power, I think even the current grid can cope with a 40% DG without trouble. Wind turbines farm running in island mode must then be implemented as well

      And subsidies? Large powerplants have been subsidized all their lifetime because we, the public buy the electricity without ever paying for the damage done by the plants. That bill has been postponed to the far future.

  • James Glennie


    1) Interesting comment from someone in the large wind industry: Only a few years ago (and even today in places) there were many in the oil and gas industry saying that large wind subsidies are ‘enormous’ and unsustainable. It seems that you have forgotten that the large wind industry, now one of the most dynamic in the world, was built on ‘enormous’ and ‘unsustainable’ subsidies.
    2) The argument about ‘Power Balance’ applies in larger measure to large wind plants. The SO has to cope with large and inherently random fluctuations in the electrical output of such plants. In fact power fluctuations from small, numerous and widely distributed DG will be less than from large, less numerous and concentrated wind farms. Its all very manageable and is simply a matter of changing the way the grid works: i.e. implementation of the Smart Grid so that the SO/DSO has instantaneous and constant understanding of the different generators on the grid and, through forecasting, when they are liable to be available and when they need to be constrained off.
    3) As above: The Smart Grid and Digital Energy

  • Bruce Becker

    Chris and James, I agree more with James than with Chris. Chris, being the cheif strategist at Vestas is stuck on the large capital outlay Vestas has made for large scale wind… therefore Chris is stuck on the grid, and the financial models that make them viable. As to your comment 2) Power balance is a grid issue, not a DG issue. Power quality produced downstream is much easier to control, and more importantly, easier to transmit.

    Both of your arguments assume that DG’s goal is to sell to the grid in the same terms as do utility scale producers… they won’t. Most DG systems are being planned for remote, hybrid generation to reduce grid dependency. Excess is therefore on a netback system to the utility, ususally at post-transformer rates (e.g. 240 VAC max). Community scale wind projects (towns, colleges) are also primarily installed for the replacement savings, not structured financially as production cash cows.

    Utility scale wind farms take advantage of wind conditions in one location. As long as the wind blows stronger that 3 m/s consistently, with few directional shifts or gusts, large scale turbine mostly do their job. Even so, there are huge inefficiencies in conditioning the output from many turbines, transmitting it, and providing power to the grid within PPA parameters. I think the fact that there is a growing grey-market in used rebuilt Vestas 65kW units,and that passsive solar for institutions are also growing, should be good enough indicators of the desire of end users to reduce their carbon foot print.

  • Corey Albrecht

    I concur with James and Bruce, Each ISO will be auditing the bandwidth of each DG installed to assure there is no rpower issue within that 240 VAC radial. 90% of the time each spread out DG will be within that ISO’s radial operation constraints. As to the higher costs of energy, DG eliminates at least 25% of the total project costs by eliminating the huge conditioning and transmission costs. Small wind is not showing to be 100% revenue focused. Many of the ROI expectations are sustainability and intangible, which is worth the higher per kilowatt initial cost. I do agree it costs more, but soon through the increased volume of small wind construction, and the manifestation of sustainability focused commercial businesses, the costs will begin to slide as your large turbines have.

    I am also seeing a huge success in remanufacturing the 100’s, 250’s, 750’s which bring them back of to and many times better shape, than original specs. These run $1,200/kw.

    How about you take all of your expertise, and use it to develop some 25 year small wind turbines with the same expertise you have for the large ones and provide it at same cost per kilowatt, and we will begin to buy them? Can you say Northern 100kw?


  • Tom Marek

    Great conversation guys. You do understand transmission grids access aren’t as plentiful as phone lines? You conversation assumes that all these terrific mini sites have access to a grid because in my experience huge projects have been trashed for the same inaccessibility – like Pickens.

    Cost of wind ownership regardless of size will include access to grid and construction of supporting assets.

  • Bruce Becker

    Hi Tom, DG doesn’t need special access to the grid, only what is normally afforded homes and businesses by being linked up to draw power. In other words, Whether community power, or house to house DG, if they are currently drawing power to consume, they automatically have the same avenue open to sell back. Bruce By the by, Pickens’ plan assumed that a swath from the Texas Pan Handle to western Dakotas would be one large scale wind farm. No that’s a transmission problem… different scale.

  • Tom Marek

    I was thinking more of the 750kW – 1.5 MW sized generation assets but, I understand.

    So when thousands of these roof top solar panels and tiny turbines create more power than the household uses in an hour or a day, where does it go?

    It goes back over the primary lines to the sub and eventually to the grid. So problem 1(a) as I see it is it becomes very difficult for Independent System Operators to balance load and generation when they have no visibility of thousands of unregulated kW’s flowing “the wrong way”. These “min plants” essentially cheat their way onto a grid over 480V distribution lines with no voltage or frequency regulation. Do we really think NERC and FERC will turn a blind eye to this if say 1000 producers put 50kW out each day? Just because you can make power doesn’t mean that power is the correct voltage or frequency or that me as you neighbor I want this questionable power that could damage my electronic appliances.

    I will modify my original; question to say, have you given thought on how to integrate these min-plants with full NERC and FERC compliance on a grid? Have you considered that 480V distribution lines are not capable or rated for distribution?

    Check out for a grid level perspective.

  • Corey Albrecht


    You are remiss by placing the small wind category into the “rooftop turbine” fad, that is sold by gimmick folks and bought by people who don’t do the numbers and have the money to throw at innefficient products for a conversation piece.

    The “wrong way?” – I dont think the electrons care which way they flow.

    As for the NERC and FERC, there are passed guidelines that have set connection standards which each state adopts into their DG guidleines which mandates each ISO must make sure their radial line is not damaged and can handle the amount in which is pumped back into the system. So your coment about unregulated is a little prolapsed, each DG has to be audited prior to commissioning and monitors it’s production monthly. Each addition to a certain radial line has a safe operating bandwidth to operate in and the ISO will not allow any individual DG to install a turbine that would exceed that bandwidth. As for the frequency topic, each DG is audited prior to and during their commissioning and operation to assure the inverters are producing the correct sine and frequency within safe operating standards, if it is outside that operating guidelines, that production is halted by the inverter’s internal systems and not placed onto the grid. So home A’s power will not hurt home B’s power. so dont worry your little head, we won’t hurt your appliances. Each ISO allows the DG’s to connect, and it is their responsibility to make sure each DG runs appropriately on that radial and monitors both the amounts and frequencies. If it does not, then they disconnect until fixed, that is the reason for fully accessible manual disconnection switch which is mandates in the PUCT guidelies, which were derived from national FERC interconnection standards . FERC has not turned a blind eye, they have transferred their national Standards and AWEA and other governing bodies have taken those standards and emulated those for all wind interconnections. The tanslation of those guidelines has actually help DG’s and ISO’s work together with a common point to start the approval process. Make no mistake, ISO’s do not and will not allow anything to be attached to their power that is going to hurt all aspects, that is why they have in the past been so anti wind. Now that national guidelines, which were adopted by the PUCT’s, ISO’s are much more amenable ad excited about “being Green”. But make no mistake, each DG has to follow all the rules or they are off the grid.

  • Bruce Becker

    Pretty much what Corey said. Each utility has their own regs for DG interconnection, power quality etc. Each at its own level. The higher the output, the stricter the regs. You can look it up also on AWEA small-wind or at DG is concerned mostly with areas behind the sub-station. The cost benefit depends on replacement savings and net backs sold. There are quite a lot of investment concerns studying this as the next wave… and there are a lot of solar/wind companies ready to capitalize.

  • Chris de Morsella

    Great thread… I have been following this discussion and wanted to add a few points. First I do not think that this is an either or proposition. There is a lot of room and need for both large scale wind (and solar) projects and smaller more modular distributed generation projects. They address different market niches and it is my opinion that the renewable energy market of the coming decades will be vast enough and varied enough to support both robust large scale grid integrated wind farms and solar fields as well as many more smaller and more widely scattered small scale distributed energy systems that are very close to the energy consumers.

    Power quality is a valid issue that DG needs to adequately address if it is going to grow into more than a niche player. However power quality on the grid is in many cases so poor that it is one of the driving motivators for large electric power consumers to install their own distributed energy systems in the first instance. Power quality issues, especially unscheduled and rolling blackouts as well as brownouts, are extremely costly to critical information infrastructure facilities such as datacenters and to large critical plants such as chip fab plants, where down time – even measured in seconds has a large economic and business cost. These facilities are increasingly turning to distributed energy systems in order to ensure their power quality!

    The cost of highly networked sensors distributed throughout the grid from the edge nodes throughout the system – in sub-stations and so forth – is changing the nature of the grid and is building a parallel real time information network on top of it. This smart grid will enable signals to be sent to connected DG nodes – such as spot price signals etc. – that will optimize and maintain a very good balance between real time supply and demand for electric energy on the grid and even potentially be able to localize these information/pricing signals to a sub-regional level. The technology to do this is already here; how fast it gets deployed and what form it finally takes is a question that needs to be answered by the various regulatory agencies and utilities themselves.

    One point I think bears mentioning is that DG systems open up the possibility for co-generation. Small scale micro-turbines and fuel cells can utilize the “waste” heat they produce to generate electricity to heat buildings, water and for absorption cooling as well. For example in demonstration projects, fuel cells have been shown to reduce facility energy service costs by 20% to 40% over conventional energy service. DG that is not based on renewable, but consumes natural gas can use these fossil energy resources more efficiently (especially when used as co-generation systems). What I would find especially exciting is progress in building scaled regenerative fuel cell systems that also where integrated to provide cogeneration – both in the discharge phase and in the recharge phases. Such units would act as distributed storage nodes on the grid – situated very close to the power (both electric and heat) consumers and would be able to use underutilized off peak energy to charge up their chemical potential energy (cogenerating heat in the process) and to shave peak demand also cogenerating in the discharge phase.

    This is an important subject and it is good to hear so many informed individuals weighing in on it.

    Chris de Morsella
    .-= Chris de Morsella´s last blog ..Will a Greening China Leave America in the Dust? =-.

  • Corey Albrecht

    Now that we have set some baselines set, can we dig deeper on DG’s who would net meter, whether co-generation or other methods, and are being charged a “Demand Charge” kilowatt fee on a monthly basis with a much smaller ongoing kilowatt/hr charge? How is the cost savings achieved and how it would offset the kilowatts generated? Would it be more through an accounting function of separate use and wind generation at the straight KW/H rate? I am thinking focused on some pro-forma at hand. Example: I place 108kw Micon on farmers pivot irrigation systemand it produces whatever. The farmer is charge an commercial structure by what the highest demand amount was for that month plus a much lower per kilowatt used. So if the farmer turns on all his pumps on hi at the same time, it spikes the demand to 180kw. The charge would be, say $11 per kilowatt or $1,980. The running kilowatt usage fee would be very small, like $.0078 per kilowatt hour used. This structure is different than resedential or office building which would be a per kilowatt used fee and can be net-metered easily. So does the farmer actually offset the demand at the meter as his cost benefit? Or does the ISO purchase the energy the farmer produces and you net-out your cost benefit on the accounting side?

    Also I do feel many companies will begin to see DG as an opportunity for their energy savings for facilities that are in a windy part of the nation to be able to budget the energy to a certain extent and setup a PPA that saves them in the long run. Any thoughts on what other positives there are and constraints?

    Chris? Any thoughts on the discussion since you started it? Will you get Vesta to build a 200 kw for $200k?
    James? Haven’t heard from you.

    For all, I just read the US department of Energy, 2008 Wind Technologies Market Report. Outstanding stuff.

  • Bruce Becker

    I look at the grid as a fluid avenue, like a market, not something rigid. The only problem is that this market is owned by the central producers of electricity, leaving new technologies to compete with Nuclear and Coal… even at its largest, wind cannot do that yet. So, I see DG as the first step to reducing grid dependence for homes, farms, and businesses… not as a replacement for grid power, but as an augmentation and therefore as a reduction of the need for grid power. This in turn reduces stresses on the grid, especially in remote locations.

    To Corey’s point, my family owned a farm once upon a time. We had to pay the transmission cost for power brought to us, so we had a surcharge per mile of line per month… the power quality was so low, it fried a number of appliances and frequently blew fuses.

    For business (especially Chris and Tracey’s silicon valley example) reliability is key at any cost (no power no business). There are communities so pissed off at reliability that they have invested in diesel units rather than put up with storm outages etc. (One store in Oak Harbor, WA lost its entire stock of produce three times… to a point no one would insure it any longer). I would love to see hybrid systems of solar, wind, and most importantly, a way to store the power. This and quality inverter.controller units will be required for DG to have any relevance to the grid. In the meantime, we will need to be creative with business models to help whiddle away grid (and all this clean coal crap) depenence.

    I really enjoyed this conversation. I would like to talk to all of you again in the future.

  • Tom Marek

    Agreed, a very good discussion. Let me first start off by giving a brief explanation on how traditional generation in managed. Generators bid their generation into their ISO the morning before the actual plan day. ISO’s pick the lowest cost bidders to satisfy the forecasted demand. ISO’s and marketers are pretty accurate with forecasting – it’s mostly pinned to weather and industrial activity these days. After that, the bid winners follow signals from the ISO to “turn up” or “turn down” their generation as the ISO seeks to match varying load requirements. ISO’s could send as many as 3000 “pulses” or change requests in a busy hour to generators. Obviously, big 500 + MW unit don’t like to follow up and down pulses; they want to sit at or above their bid generation target statically. They make more money and suffer less equipment determination at a steady state.

    The point is here, one of the biggest obstacles to legitimizing DG is then integrating these micro generation sites into a grid. It’s pretty clear farmer Joe isn’t going to call in with the big guys each morning and act like a power plant. However, multiply farmer Joe’s net demonstrated capability of maximum generation (NDC) at 10-50kw by 100 or 1000 other farmer Joe’s and you can see how the ISO with a pretty accurate picture of his load and generation on an AGC signal (automatic governance control or command – the signal or pulse) is going to pull his hair out when a big gust of wind unexpectedly puts a few unforeseen MW’s on the grid. AC power has to go somewhere and without storage, it gets dissipated as heat (and line sag) over the transmission lines until the ISO can peel back his bid in generators by turning them down. When the wind dies down the ISO freaks out and dials the big boys back up.

    In order for DG to be accepted and not compromise grid security (which is a real big deal now for FERC with all the small and medium sized wind and solar plants coming online) you then have two options. Firstly, use the micro generation locally and store or dissipate over generation. Secondly if you want to put the power to grid, DG owner/operators would have to buy some kind of FERC compliant SCADA system like wind turbines have so the ISO can see what power is on line, who is making it and what quality it is. This system would allow ISO’s to have authority to reject poor quality power or excess generation.

    Metering, settlement and payment are much larger issues that someone wiser about this aspect could likely write a book on. But my 25 word or less summary is; I suppose DG can work safely and effectively if someone can supply a SCADA like system to prevent accidental or intentional grid events.

  • Bruce Becker

    I get your point, but think it is more a worst-case fear. When testing our unit in the wind tunnel at 220VAC we needed a load bank to dump the power (a giant resistor), so I can see the power lines sagging etc. only south of the substation. Perhaps the farmer and his friends form a cooperative to help with that micro grid problem.

    Here are some things which mitigate this worst case scenario. Assume, DG Wind 100 units X 50 kW rated power at 240 VAC 1) What is the downstream load of the area? Leaving you with a net power surplus/deficit. 2) The likelihood of any of these 100 units producing at max rated power is <1% (how often do you feel a steady 35 mph wind?), and the likelihood of all 100 DG units generating at max power is lower than that. The assumed max scenaro (100 X 50 kW = 5 MW) – community farm/residential peak load of 10 MW, that’s 5 MW the ISO can reduce production for. If the peak demand is lower than 5 MW, then we have a potential problem… If there were a coop managing the community micro grid, then they could heat the local pool for a few hours, or heat the nursing home. But, seeing power curves of most DG turbine mfgr, peak output does not occur until sustain average wind speeds of 20-30 mph. The average available is 7-12 mph, so we can assume an output range of 2-3 MW in this scenario.

    I think for the ISO a SCADA system or some other monitoring software would be required even if there were no DG wind… but I think those involved with managing the grid ought to get prepared… Farms are more and more automated with increasing scale, commercial/industrial are looking for ways to decrease cost… all are worried that rates will go the way of Hawaii ($0.18/kWh). Customers are ready for DG.

  • Corey Albrecht

    Ok, so question.

    We described the turbines creating headache of too much power without fore warning for the ISO. But what about the opposite headache? Someone tunring on a major draw on an inconsistent basis. Are they required to give head warning? Is it less offensive when there is a power need that occurs than power overload? I guess we are wondering into Smart Grid territory.

    So back to turbines, if the turbines are equipt with internet or cell phone accessible SCADA, which we monitor from the internet and has wind forecasting included, couldn’t we give the ISO we are attached to access to the 100 turbines data as a regional group? Assuming all DG were willing to do so? Then the ISO can culminate and monitor the real time data accessible. I guess it would be a matter of all having the same software or have an integrator (business opportunity?) for each software. I would be willing to give access to our real time data and give the ISO access. Is there another option? Isn’t there a new meter coming out that is connected in real time to the ISO? They can require these for the DG’s and would get exactly what is being pumped into the system from there own meters immediately and could avoid software issues through SCADA. I for one would pay more for that type of inteconnection to avoid any ISO frustration.

    I have a business plan and am looking for some companies who are ready to add a midsize turbine to their land and provide budget friendly costs for 20+ years. Anyone know companies interested?

    Love this discussion by the way! Getting down to real mid market issues.

  • Chris Varrone

    First, I applaud this thread – very interesting!

    Second, I do not in any way speak for my company here. Only PERSONAL opinions.

    Third, I’m not “stuck” on anything – if DG works to relieve load on the grid, hallelujah! If it does, then DG adds clean energy itself AND relieves the load on the high-voltage part of the grid, which makes room for centralized wind, solar, biomass, etc. The concerns I raised at the beginning were ones I get confronted with every day.

    Fourth, the same companies that made the kilowatt range turbines in the 80s and 90s are the ones bringing you MW turbines today. “They is us.” The industry up-sized itself, dramatically (and phased out everything below 750 kW, just about). Altamont Pass has close to 5000 turbines with a combined rated power of about 150 modern machines. Which is better, 5000 little guys or 150 big ones? Well, there are pluses and minuses, but overall, I’d rather have the 150 machines to operate (and look at). Of course electrically, the new machines are far superior. Part of the reason the industry moved to larger machines was the efficiency – cost per MW installed fell dramatically from the 80s to the early 2000s. If the DG market is relying completely on net-metering, esp of the “unlimited” type where the meter spins backward, then it is very vulnerable. Utility people see them as “free-riders” and in many ways this is true.

    Fifth, with the right regulations (grid code, etc) in place, DG can comprise a large portion of generation without too much difficulty. Denmark built hundreds of local CHP plants in the 90s, plus thousands of small turbines all over the landscape. More and more the local CHPs are biomass-based – the system needs firm power, and biomass is firm, as well as renewable.) These all combined probably make up something like 20-30% of electricity in DK. No trouble – and the average unit size brings probability of failure down, and the proximity to load brings strain on transmission down. Interesting link (if it doesn’t work, go to and click on English and find the Danish Wind Case) [|leo://plh/http%3A*3*3www%2Eenerginet%2Edk*3en*3menu*3Climate%2Band%2Bthe%2Benvironment*3Climate*3The%2BDanish%2Bwind%2Bcase*3The%2BDanish%2Bwind%2Bcase%2Ehtm/_t5h?_t=tracking_disc ]. See the pdf on Danish wind fast facts.

    Lastly, the organizational question about TSOs and DSOs may not exist in the US. This may be more of a European issue – but as DG starts to dominate the local scene, DSOs may not have the resources or the jurisdiction to regulate what becomes a kind of micro-grid.

    Full system transparency via SCADA would help – and I agree with many of the comments about SCADA made earlier. DG equipped with SCADA would be more valuable to the overall system and to individual generators as well.

    Keep up the great discussion, everyone!

  • Corey Albrecht

    Chris, so lets keep the thread going. I wish more would join in. From your quote “If the DG market is relying completely on net-metering, esp of the “unlimited” type where the meter spins backward, then it is very vulnerable”, what, how and why does net-metering make it vulnerable? Is it over generating the usage or other.

    This is paragraph from the danish website. “Power system balancing. Today, with a 20% wind-power share, shortage of capacity is not a problem as renewable energy has not yet displaced large power stations. Oversupply is a problem for nearly 100 hours a year. The problem is expected to become 3-5 times worse in a few years unless other means are introduced.

    So 100 hours a year, with more than 20% of country on wind power is 1.1% of the hours in the year. This is so small. Am i missing something, or is this 1% a huge issue when it happens.

    Do the big “wind farms” boys send the SCADA information to the ISO’s? Is there some entity that is collecting this real time data and using it for ISO forecasting? Or are th efarms using the SCADA for their own business needs. Is the SCADA software able to export data per their location? Maybe this could be requirement in net metering to calm and promote ISO’s to open up.

  • Ger Groeneveld

    Sure interesting discussion here. I fulfill the wish of Corey by joining in as well. To stabilize the grid some kind of storage is needed, preferably storage of electrical energy. In Australia there is a wind power farm using vanadium redox batteries to supply power for peak-hours and in times of wind shortage. Also augmented with diesel power.
    SCADA systems do exist already. Definitions for the protocol of communications are also in place in Europe/Holland. The trouble being applying those for reasonable cost.
    As with most biomass/renewables generating equipment, those do exist already for a many years. It all breaks down, for me it is, at the cost level because we never have ever charged the fossil fuel users generating companies for the pollution, land use change, land re-shaping (for the worse) But in our calculation, procedures to install renewable or wind/solar power we do charge the cost into the equipment like horizon contamination, building costs etc. A good thing though. If every power generator should carry that cost as well. I would not be surprised that the actual cost would get to the $0.18 kWh for fossil power as well (if not higher). Making it cost effective right away.

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    Hi Tom, DG doesn’t need special access to the grid, only what is normally afforded homes and businesses by being linked up to draw power.