Electric Utility Companies Are Sweating

This month's Power Engineering Magazine had a big surprise in it. Instead of reporting solely on progress of EPA legislation, various plant cleanups and oil spills, and the newest, most fanciful steam turbines, Mr. Russel Ray wrote a full-page report addressing what he calls "disruptive" and "burgeoning" technology--"Distributed Energy Resources" or DER.

Distributed Energy Resources is another term for energy turned into electrical power that's not generated and distributed from a central power station. These energy resources include solar panels and wind generation, which are both becoming economically viable for individuals and companies alike. There has been a radical surge of use into these technologies, arguably reducing the need for central generation.

It's Mr. Ray's opinion that this surge is not something to be worried about, that statements like this one from Jon Wellinghoff, "Solar is growing so fast it's going to overtake everything!" distort the nature of where the US power generation market is headed.

This is partly true, and partly false. Wellinghoff is correct that we will continue to see a rise in the availability, efficiency, and economy of solar power as we move forward toward 2020, and as such will see more use. Mr. Ray is also correct, since it would not seem that we as a nation are ready to move on from our power grid just yet, and that renewables certainly will not take hold overnight.

But I detect in Mr. Ray, especially in this episode of Power Engineering, a vivid fear that what he says may actually not be true. Throughout the rest of the article Mr. Ray provides reasons why DER will not overtake centrally generated power any time soon, citing even the failure in German legislation to implement an effective renewable grid without causing energy spikes or shortages.

But if history has taught us one lesson, it should be this: humans will follow the path of least resistance, especially when it comes to money. There is no reason to assume that DER won't overtake centralized power generation if it becomes so cheap and affordable as to justify a setup, and significant return on investment.

Mr. Rays advice to Power Engineers is that we should not expect a move away from central generation. My advice is this: Power Engineers should jump ship and head for the DER train, because it isn't slowing down anytime soon.