Distributed Generation Echoes Innovation

Distributed generation could become the electricity industry’s new iphone.
Published: Thu 24 Apr 2014

The iphone is a good indication of how technology develops to meet our changing needs. Today’s world has a relentless hunger for innovative products. Expectations around our needs and comfort levels are growing and people are generally willing to pay for this innovativeness.

Not that long ago, we were introduced to bulky computers (with slow and limited capabilities) that were plugged into a wall. Economies of scale favored consolidation of analytical power and memory storage in large mainframe computer systems, which could be accessed by multiple users through ‘dumb’ terminals with little or no processing power of their own (think batch processing via punch cards).

How quickly that has changed! Now, we have ipads and laptops that we can carry around and access to sites and programs are faster and easier to use. Wireless connection has taken the IT world onto a whole new level. Convenience and comfort is what this innovative market is about and consumers are responding positively to the wide variety of options that are on offer.

People are beginning to expect the same level of innovation and transformation from the electricity industry.

Today’s grid: old, expensive, inefficient and obsolete

The current ageing electricity grid can be easily compared to the first computer system-the centralized grid is defined by large centralized power plants justified by economies of scale. From the beginning, the power industry has worked to build larger generation facilities in order to reduce the marginal cost of electricity production. That is why today we see monolithic power plants dominating landscapes, requiring millions of miles of costly transmission and distribution infrastructure to deliver power to load centers where the power is finally consumed.

Steve Hellman, president of Eos Energy Storage likens today’s centralized power system to a 1950’s mainframe computer: old, expensive, inefficient, and obsolete. He also explains that extreme weather events like superstorm Sandy reminds us that today’s unidirectional grid is inherently fragile and vulnerable. One fallen tree-limb can put an entire community in darkness and the failure of one transformer can cause week-long blackouts.

The future of power

Today, iphones and tablets have far more memory and processing power than those first mainframe computers.

The rapid development in performance of computer hardware follows Moore’s law, which predicts that the number of transistors on integrated circuits will double approximately every two years. This same law now guides long-term planning in the semiconductor industry—which has seen a continuous increase in performance and a 7% year-on-year decrease in the cost of silicon based solar photovoltaics (PV), explains Mr Hellman.

If this trend continues, in 20 years from now, solar PV will cost just over 50 cents per watt on an installed basis. This is effectively half the cost of electricity produced by coal today.

“The ramifications for the way we produce and consume electricity are tremendous,” points out Mr Hellman, “Flexible, durable solar photovoltaics can be rolled out as if manufactured by a printing press or even sprayed on to various surfaces.”

With the high level of innovation today, it is quite possible that future generations will live in a world where solar electricity is generated on every surface of every building-not just on roofs. Already, innovative firms are developing solar panels for vehicles and clothes.

Just as processing power moved from the mainframe computer to your iphone or laptop PC, electricity production is already making a move from centralized power plants to distributed generation. Energy storage solution providers will need to move fast if they want to keep up with this fast-developing market.