In the spring of 2003, Dan Fink got a hamster named Skippy to power a nightlight. It took some imagination. First, Skippy had to be no ordinary hamster, but one of the Syrian variety, a breed that runs particularly fast and goes all night. Next, for all his relative speed, it turned out Skippy could only chug along at 60 revolutions per minute, too slow to charge a battery or generate a volt, so Fink had to build him an alternator out of extremely strong magnets. And then there was Skippy's noisy exercise wheel, which was not only obnoxious, but a waste of energy. Fink solved that by retrofitting it with a smooth ball-bearing.

Finally, after Fink glued 14 magnets to a steel ring and fashioned two coils out of 30-gauge wire, he mounted the whole contraption on Skippy's cage. He then hooked up two LED lights to the alternator. Together, they shone bright enough for Fink to find the bathroom in the dead of night. And even though the little rodent was voltage-deficient, "he had torque to spare," Fink says, so he added another light, and another, the resistance increasing with each new load. He got up to six lights before Skippy showed any fatigue.

Fink, with his friend Dan Bartmann, co-owns the company Forcefield, and lives off the grid in the mountains above Fort Collins, Colo. If you have space for a 30-foot tower, the Forcefield guys will help you build a backyard wind turbine and hook up to your local utility. They talk about the physics of electricity the way other people talk about their favorite bands.

"Did you know you can see electrical charges?" Fink says. "That's why metals look shiny. You're seeing electrons absorbing photons and emitting them back at you."

Fink acknowledges that hamster power is a bit silly; "I only did it because kids wrote in to ask us," he says. But the experiment demonstrates a principle that science-minded eighth-graders understand better than many adults: One way of generating electricity is to spin a wheel of magnets around metal, or a metal wheel around a magnet. And there are many different ways to get that wheel to spin. Wind will do it, and so will a waterfall. Steam will, too, whether raised by burning coal, splitting atoms or with the concentrated energy of the sun. The principle remains the same: Mechanical energy creates electrical energy when electron-conducting metal travels through a magnetic field.

Fink, who considers education to be Forcefield's primary business, believes our widespread ignorance about the workings of watts and volts has gotten us into trouble. "People call us all the time and say, 'I'm worried about climate change! I want to put solar panels on my roof,' " Fink says. "But then we find out their houses aren't insulated, and they're using incandescent light bulbs during the day. We make them do all the cheaper things before we teach them how to make their own power."

When people do make their own power -- on their rooftops, or with a 30-kilowatt microturbine installed in the basement -- they pay more attention to how they use it. They replace kitchen lights with compact fluorescents and reading lights with LEDs. They might even turn the lights off altogether for a few hours.

Electricity generated Forcefield's way -- close to home and in small batches -- is called distributed generation. It's the way Thomas Edison originally delivered electricity back in 1882, when he built the United States' first power plant in Manhattan and provided energy to just 60 customers. In the last decade or so, ever since California became the first state to open its energy markets to individual competitors, distributed generation has been sputtering back into the U.S. energy mix, making a dent in energy demand and securing supplies where blackouts mean disaster. It allows an ordinary electricity consumer to become a one-person power plant, and guarantees that a business can weather a downed power line without incident.

Local power plants are not always easier on the planet than the ginormous remote kind, but at least their pollution is immediate and visible, which makes it easier to clean up before it goes global. "Small-scale operations, no matter how numerous," wrote E.F. Schumacher in his 1973 book, Small is Beautiful, "are always less likely to be harmful to the natural environment than large-scale ones, as their individual force is small in relation to the recuperative forces of nature."

And local, small power plants operate close to the buildings where people live and work, so they sacrifice less energy to transmission. Their waste heat can be used to warm rooms and water, in a process called combined heat-and-power (CHP), which doubles a generator's efficiency. In some cases, that waste heat can turn another fluid into gas to spin another turbine and make yet more electricity.

So why aren't we turning en masse to local generation to offset coal-fired power and reduce carbon dioxide emissions? The short answer is that, ever since 1895, when Nikola Tesla and George Westinghouse lit up Buffalo, N.Y., with an alternating current generated 90 miles away at Niagara Falls, the developed world has acted as if all our power plants were waterfalls located far from the cities that need light. The longer answer requires taking a close look at energy policy in the United States: Who makes money on it and how it moves forward.

A revised blueprint that can accommodate smaller, scattered systems would have to be more complicated and would strain and confuse the transmission system that evolved over the last century. That system was set up for the utilities that once owned and controlled every part of the electricity business, from generators to distribution lines to transmission corridors -- utilities that, for more than a century, found that the bigger the plant, the more efficient it was, and the cheaper the power that came from it. Whether overhauling the system is worth it depends on a lot of factors, one of them being money. And, perhaps, how desperate we are for solutions.