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Credit: Paul Lachine -
Credit: Paul Lachine -
Credit: Courtesy Gills Onions -
The Gills expect to save hundreds of thousands of dollars annually on waste disposal, and with grants and incentives, will pay off the system in five years. -
More than 200,000 pounds a day of waste at Gills Onions — “a huge, stinking mess” — is now food for digester bugs that will create methane gas for fuel cells. -
Credit: Paul Lachine -
Sopogy’s 1-megawatt installation of compact concentrating solar thermal power generators on a lava-rock hill at the Natural Energy Laboratory on Hawaii. The generators focus sunlight on a fluid that turns into gas that powers an internal turbine. Sopogy founder Darren Kimura has installed solar arrays around the world, but he’s particularly focused on offsetting his native Hawaii’s nearly total dependence on imported oil. -
A compact concentrating solar thermal power generators. -
Homegrown electricity at the off-the-grid workshop of Dan Fink and Dan Bartmann near Fort Collins, Colorado. -
artmann uses a hand-crank to power a lightbulb -
Fink dusts off the cage and wheel where Skippy the hamster (now deceased) powered a nightlight -
Turbine blades made to order at the shop -
Credit: Paul Lachine
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.
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If you read High Country News, you probably know the statistics: Global greenhouse gas emissions have increased 70 percent since 1970, and our energy-squandering ways are to blame. Coal-fired power accounts for nearly a third of all energy-related greenhouse gas emissions in the U.S.; natural gas power another 10 percent. If our emissions continue to climb, the oceans will rise and submerge island nations, species will go extinct, and millions of acres of fertile soil will turn to punishing dust.
We may be able to avert the worst of these consequences, say a team of scientists in the journal Nature, if we cut our carbon emissions to half of what they were in 1990. In the U.S. alone, that means reducing carbon by 3.5 billion metric tons, the equivalent of retiring all of our coal-fired and natural gas power plants.
In many environmental circles, these facts have been used to support a simple argument: Anything done to displace coal-fired power is good. We need big solutions and massive investments in energy projects, centralized and large like the old ones, only cleaner. Small solutions will take too long.
And maybe that’s true. A 2007 Department of Energy report estimates that 12 million independently owned small onsite generators, or “DG units,” currently operate in the U.S., with a combined capacity of only 2,000 megawatts. Roughly half of those megawatts are from solar photovoltaic cells, which produce electricity by absorbing the sun’s photons and liberating electrons. In a country with a little more than 1 million megawatts of generating capacity — slightly more than 90 percent of it fossil-fueled or nuclear — those numbers seem hardly worth discussing.
But even that report, which Congress ordered the Energy Department to complete in accordance with the 2005 energy bill, finds few reasons not to scale down more of our power and move it closer to home. The authors argue that the days of “economies of scale,” as they apply to electrical power generation, are over: The improved technology and efficiency of small-scale systems means that it no longer costs less per kilowatt to build giant plants.
That’s not to say that we don’t need large-scale renewable energy to help replace fossil fuels. Electricity generated at big wind farms costs 5 cents per kilowatt-hour, well below the national retail electricity average of 10 cents; with production tax credits, the price drops to 3 cents per kilowatt-hour, which is hard to beat. Photovoltaic solar still costs 30 cents per kilowatt-hour compared to 15 cents per kilowatt-hour for large-scale concentrating solar power (CSP), which uses sun-tracking mirrors to focus the sun’s energy, and can be scaled up to hundreds of megawatts.
Nor does it mean that distributed energy alone can solve all, or even most, of our energy problems. The precise benefits of millions of small generators infiltrating the U.S. power supply are difficult to predict, even for the Energy Department. (Doing so would require “a complete dataset of the operational characteristics for a specific site,” and success would be “highly improbable.”) But to trivialize distributed generation’s potential is to assume that our problems stem only from the fuel we use to make electricity, not from the model we use for generating it.
There are many indications that large solutions will take longer than small ones. Even leaving aside the land-use issues and lengthy permitting processes that may bog down large-scale renewable projects for years, the Midwestern Independent System Operator estimates that just to bring wind energy from the Great Plains to cities will require building $80 billion worth of transmission lines, amounting to more than half the circumference of the earth. We’re also in a deep recession.
“When the capital market returns, the small, fast, modular projects will recover much faster than the big, slow, lumpy ones,” says Rocky Mountain Institute founder Amory Lovins, who has been advocating for distributed generation for 30 years. “Central power plants with capital costs in the billions can’t get financing at all.” Collectively, the benefits of distributed energy — Lovins counts 207 of them — “increase the value of smaller systems by a factor of 10. That’s enough to flip any investment decision.”
As with Dan Fink’s experiment with Skippy and the wheel, the transition to small and local after a century of large and distant may take some imagination. “What you’re really talking about,” Lovins says, “is the flowering of a million miniature solutions.”
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There’s another lesson to be learned from Skippy, who in his living hamster-ness reminds us once again that not all fuels are fossil. And just as there are many ways to spin a turbine, there are lots of ways to make fuel. You can even extract it from your garbage.
Ten years ago, Steve and David Gill weren’t thinking about energy solutions. They were looking for something to do with the 200,000 to 300,000 pounds a day of waste they had leftover from peeling and chopping onions for salsa companies and supermarkets. They originally tried using it for compost on the 15,000 acres of onion fields they tend in Oxnard, Calif., but as their business grew, it became, Steve Gill says, “a huge, stinking mess.”
The Gills had been hit hard by the California energy crisis in the summer of 2000, when the manipulation of the state’s electricity market caused blackouts across the state. It made Steve Gill think: What if onion waste could somehow be turned into energy?
Gill called his friend, Bill Deaton, a chemical engineer and energy consultant from Kayenta, Utah. Deaton had an idea for seeding the Gills’ onion waste with tiny bugs that would digest the waste and turn it into methane. “Digester gas,” as it’s called, has already been made from beer waste to run boilers at breweries; dairy farmers from Maryland to California feed digesters with manure and make a profit on the fuel. New York City makes 4.7 billion cubic feet of methane from its wastewater sludge. No one, however, had yet made methane from onions.
Deaton consulted the California Biomass Collective at the University of California at Davis, which determined that the sugar in onions makes them particularly nutritious food for microbes. He got a Dutch company, Biothane, to build a specialized digester. “It’s heaven for microbes in the digester,” Deaton says. “We give them the right temperature, the right pH, and make the food available. They eat all this stuff, and they develop gas. That’s methane.” Deaton and Gill elected to use the digester gas in a fuel cell.
A fuel cell makes electricity through chemistry. It works like a battery that never needs recharging, as long as you keep feeding it hydrogen. FuelCell Technology Inc. of Danbury, Conn., manufactures a fuel cell that converts methane to hydrogen internally, mixing hydrogen electrons with oxygen electrons to make electricity, heat and water. It’s quiet, emits nothing and with combined heat-and-power, it runs at 90 percent efficiency.
Fuel cells have limitations. They need pristine methane to run properly; the sulfur that stings your eyes when you chop an onion will poison a delicate fuel cell. The California Energy Commission awarded a $106,000 grant to an Illinois company, Gas Technology Institute, to figure out how to take the sulfur out of the onions. The solution will extend to other agricultural wastes in the future.
The system will take a few months to ramp up, says Deaton. The microbes, which came from Anheuser Busch — they’re “beer bugs,” Deaton says — have to adapt, eat and digest before sufficient gas can be harvested. For now, the Gills’ two 300-kilowatt fuel cells operate on natural gas, connected up to Southern California Edison’s grid. They inoculated the digester on June 8, and expect to have onion fuel by fall.
The state and federal governments have been supportive: California’s Public Utilities Commission ponied up $2.8 million from its Self-Generation Incentive Program, and the Gills will get another $1.8 million from the federal government, money that would have trickled in as an investment tax credit before February’s stimulus bill turned it into a grant. The entire project, including all the research, cost $9 million, but the Gills will save hundreds of thousands of dollars every year on waste disposal. With the incentives, he expects it to pay for itself within five years. And he can be confident about the math: Although natural gas prices fluctuate wildly several times a year, the price of onion gas is always the same.
Steve Gill acknowledges that his transition to local power was far from simple. Negotiations with Southern California Edison were “time-consuming,” he says. (Utilities typically extract a number of significant fees for the transition to local power.) He might have given up were he not intent on “getting rid of a huge problem,” he admits. And “now we’ve turned the whole thing into a demonstration project.”
The University of California at Santa Barbara has adopted Gills Onions as a teaching model for other agricultural operations, and now Steve Gill goes around, he says, “helping other guys do this thing. Because really, you shouldn’t have any waste out of a food plant. There’s a use for everything.”
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E.F. Schumacher wrote Small is Beautiful 36 years ago, when political shifts in the Middle East suddenly awakened the world to the reality that its petroleum might not last forever. In the years that followed, we were supposed to start driving smaller cars, wearing cardigans in the house, plastering our rooftops with solar panels. Congress passed the Public Utility Regulatory Policies Act (PURPA) in 1978, requiring utilities to buy electricity from independent renewable generators at competitive rates. Millions of solar roofs were set to bloom.
But it didn’t happen. Instead, cars got big again and the sweaters came off, along with the solar panels on Reagan’s White House roof. And large, centralized fossil-fuel plants solidified their hegemony: Between 1980 and 1999 in the United States, 155 new coal plants came online. Photovoltaics and wind could not begin to compete with the price of electricity generated from coal. Consequently, PURPA did little to promote any kind of renewable energy except combined heat-and-power.
Coal’s steady pulse of cheap electrons seduced us into doubting whether efficiency itself was worth the trouble. While a few states have followed California’s lead in “decoupling” utility profits from electricity sales, for most of our electrical history, utilities made a profit per kilowatt-hour. Along with those profits came a parade of gadgets to encourage profligacy: electric can-openers and toothbrushes, garage-door lifters, dishwashers and air conditioners, all of them creating a need where there once wasn’t even a desire. GE, as its slogan went, brought good things to life.
In an essay published in the 1983 book Nuclear Power: Both Sides, Amory Lovins described how French energy-efficiency planners in the 1970s figured out that most of their electricity went into heating buildings. Because France fueled almost all of its generators with oil, and oil supplies were suddenly in peril, efficiency experts started looking to other sources — waste heat from on-site generators, passive solar, natural gas — to warm the country’s buildings.
At the same time, however, the country’s energy supply planners, “who were far more numerous and influential in the French government,” discovered nuclear power. By the mid-1980s, the country had more than 50 reactors, generating so much electricity that heating buildings with it didn’t seem so wasteful anymore. In fact, “the only way they would be able to sell all that electricity would be for electrical heating.”
Lovins’ point was this: If you start at the consumer end, you can calculate how much energy we need to live and build what you need to supply it. If you start at the supply end, you predict future demand by adding numbers to the current demand. And you can only satisfy that demand with ever-larger supplies of power.
If it’s hard to separate reliable electricity from behemoth generators, it’s harder still to think of getting by without coal, oil or natural gas. As former Energy Secretary James Schlesinger and Energy Department veteran Robert L. Hirsch wrote in a recent editorial for the Washington Post, “Solar and wind electricity systems must be backed up 100 percent by other forms of generation to ensure against blackouts. And in today’s world, that backup power can only come from fossil fuels.”
They’re partly right: In general, wind farms and solar plants generate power at the mercy of nature. But as onion fuel demonstrates, backup power can come from multiple sources. It can even come from the sun.
About 2,500 miles across the Pacific, Darren Kimura has a cough. “It’s the ‘vog’,” he says on the phone, a condition that occurs when ash from Hawaii’s Kilauea volcano mixes with moisture-laden southern breezes. “I’m allergic to it.”
Still, he soldiers on to explain the mechanics of the organic Rankine cycle, the process his company, Sopogy, uses in its compact concentrating solar thermal power generators to make and store electricity.
“In the ‘organic’ Rankine cycle, you use organic fluids,” he explains, such as liquid propane, which changes based on the temperature. As with large-scale concentrating solar thermal plants, sun-tracking mirrors in Sopogy’s technology focus sunlight on a container of fluid. As the fluid flashes to gas, it spins a turbine. While batteries store electrons, a Sopogy collector simply stores heat, “like a thermos,” says Kimura, so the miniature solar collector can extend the solar day and generate power through the vog. “Storing thermal energy is cheap, and the system lasts for 30 years.”
A typical Sopogy unit weighs 150 pounds, measures about 12 feet by 5 feet and puts out 250 kilowatts at 392 degrees Fahrenheit. The unit doesn’t even need flat land: Sopogy has tucked a 1-megawatt system into four lava-encrusted acres at the Natural Energy Laboratory on the Big Island. Kimura tells only potential clients the full price of the system, but he promises that a Sopogy collector can generate electricity at 20 cents per kilowatt-hour, 10 cents less than photovoltaic solar. As with photovoltaics, that cost will drop as manufacturing scales up.
Kimura is a slightly built 34-year-old, who looks even younger in person. But he’s studied energy ever since his parents helped build Hawaii’s space observatories, putting their son to work wiring the utility substations that powered the telescopes. At an early age, he realized that his state had energy problems: “We can’t build more power plants, but we’ve had a soaring demand for power,” he says. “I had an incentive early on to care about efficiency.” Later, he worked on a voltage-regulation device that would even out loads from distributed generators across small local grids. In Portland, Ore., in the 1990s, he helped the federal government develop efficiency standards for Energy-Star appliances.
Nine years ago, Kimura came back to Hawaii, to apply his expertise to the state’s peculiar energy problems. Hawaii has long been nearly 100 percent dependent on oil, but Gov. Linda Lingle, R, has set an ambitious goal of securing 70 percent of the state’s energy from renewables by 2030. “We have a very limited amount of land and unique conditions,” Kimura says. “We need to use our local resources. We needed to do something conventional and simple, something a plumber could understand, because you can’t fly a consultant in from California every time you have a problem.” Because a Sopogy system is “just metal and a steam turbine,” Kimura says, it’s possible to “manufacture them in an automotive parts factory with the same equipment, the same press, the same laborer who once made the car frame window.”
The Hawaiian government has given Kimura $10 million to fund more research, and the vice president of the state’s major utility, the Hawaiian Electric Co., has been an enthusiastic backer. With recent publicity about large concentrating solar plants in California’s Mojave Desert, requests for quotes from Sopogy have gone from one a month to 15 a week. Kimura has tested the system in Abu Dhabi, in Washington state and in Spain. This summer, the company will install 50 megawatts of solar power spread over several small installations in Toledo, Spain.
Kimura’s system is not the only way to get small-scale non-photovoltaic electricity from the sun. An Arizona company called Stirling Energy Systems has built six 25-megawatt solar generators using engine technology originally invented by Robert Stirling, a Scottish minister, in 1816. Mirrored dishes focus the sun’s heat on hydrogen gas, which turns small electric generators as it expands and contracts. The gas never escapes or runs out; it’s not being burned so much as put to work.
But Stirling is thinking big: The company has contracts with both Southern California Edison and San Diego Gas & Electric to supply 1,600 megawatts of power in installations of 300 megawatts or more by 2012, backed by $100 million invested by an Irish developer in April 2008. But that sum represents less than a 20th of the system’s estimated cost, and the technology has yet to be demonstrated on such a large scale. In poor developing countries, though, with few capital reserves, small concentrating solar generators have already been deployed by the Solar Turbine Group of Cambridge, Mass. The nonprofit has installed two such systems, one and three kilowatts each, to provide electricity and hot water to rural villages in the Southern African country of Lesotho. More will follow.
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A few years into deregulation in California, when people were getting stranded in elevators and produce rotted in coolers during blackouts, distributed energy seemed once again to be the wave of the future. The push toward small and local began when the state partially deregulated the electricity markets in 1996; it continued on through 2000, when the Public Utilities Commission established uniform statewide standards for distributed systems to connect up to the grid.
Yet for all the technologies that have sprung up around that effort, from microturbines to photovoltaics poured into shingles, California’s major investor-owned utilities have not exactly encouraged their customers to invest in their own small generators. Indeed, as former state Energy Commissioner John Geesman put it two years ago, “There’s an ongoing schizophrenia in state energy policy between what we say we want to do and what we actually allow to happen.” Eloquent state reports hail the advantages of distributed energy, but the state regulates utility profits in such a way that customer-owned generation shrinks utilities’ earnings. The current rules make a $700 million steam-generator replacement at a nuclear power plant, or a $2 billion transmission line, appear to be sound investments, because the utility can bill customers for their cost and upkeep.
“Large utility-owned power plants, transmission and distribution lines, electric and gas meters all contribute to the revenue stream (of investor-owned utilities),” says Bill Powers, an electrical engineer and energy consultant in San Diego, Calif. The more a utility owns, the more it earns.” The profit is not trivial: The California Energy Circuit reports that Pacific Gas & Electric chief executive Peter Darbee earned $8.7 million last year, 5 percent more than the year before, despite a reported $79 billion in average annual losses due to blackouts.
Most of Powers’ research, which can be found in a document called San Diego Smart Energy 2020, has been focused on obviating the need for the Sunrise Powerlink, a 500-kilovolt transmission corridor slated to cut through pristine areas of San Diego County to bring solar and geothermal energy from remote locales to the city. San Diego Gas & Electric, a subsidiary of Sempra Energy, has promised its investors that the utility will earn a $1.3 billion profit on the $1.9 billion line. “When I looked at the numbers,” Powers says, “I thought, ‘I may even consider building a transmission line myself.’ “
Damon Franz, a regulatory analyst with the California Public Utilities Commission, agrees that none of the investor-owned utilities that dominate the state have a direct monetary incentive to encourage distributed generation. But he notes that some utilities pursue some distributed energy anyway, simply because it’s good public relations. Southern California Edison has conducted workshops to support customers wanting to take advantage of the California Solar Initiative, a program that pays cash incentives for photovoltaic systems. PG&E helps people connect new systems to the grid in record time. “The people that work within that program get 90 percent of their applications processed within a month,” Franz says. He attributes such responsiveness to a service territory full of “eco-minded and progressive” customers.
PG&E has also been worried about losing those eco-minded and progressive customers. In 2007, just as a coalition of San Francisco environmentalists and consumer groups, including the local Sierra Club and the Democratic Party, unveiled plans to break free of the utility, PG&E launched a $10 million marketing effort called “Let’s Green This City.” The San Francisco County Board of Supervisors responded by approving the activists’ plan, allowing the city to take advantage of a 2002 law that permits cities and groups of cities to shop among independent producers for power. “Clean Power San Francisco” has now set a goal of securing 51 percent of its power from renewable sources, including digester gas-powered fuel cells and microturbines, by 2017. “Distributed generation is a core part of the city’s goals,” says Michael Campbell, the program’s director.
Other communities in other utilities’ territories may follow San Francisco’s example. In April, Southern California Edison angered residents of Palm Desert, Calif., when it lobbied against legislation meant to subsidize rooftop solar. The bill would have required utilities to establish a “feed-in tariff” to compensate owners of photovoltaic installations per kilowatt-hour at a premium rate.
The state assemblyman who authored the bill, Brian Nestande, withdrew it shortly after Southern California Edison executive Catherine Hackney sent a letter to legislators asking them to vote against the bill. The state already allows customers with small renewable systems to choose between selling as much electricity back to the utility as they use (known as “net metering”) or selling all the electricity they generate — including any surplus — for a modest feed-in tariff. As the tariff on average pays less than California’s 12-cent-per-kilowatt-hour retail electricity rate, it benefits almost no one.
Assemblyman Jared Huffman of Marin County received similar input on a bill to allow small wind and solar producers to sell surplus power back to the grid, a measure he believes would encourage more consumers who install their own systems to conserve electricity. Huffman’s legislative analyst, Lawrence Cooper, compares the current system to filling your car’s tank but having to turn in your surplus gas should you not burn through it after a certain period of time. “These people paid to put their systems on their homes,” he says, “they’re providing power for the grid. They should get paid for them.”
Huffman says the bill actually benefits the utilities because they get credit toward their renewable energy requirements, which in California will rise from 20 percent in 2010 to 33 percent in 2020. Still, Pacific Gas & Electric has not dropped its opposition, even though the bill has been re-written and re-introduced, and no longer allows homeowners to intentionally install more power than they need.
Two decades after the french went nuclear, Amory Lovins and a group of co-authors published the book Small is Profitable: The Hidden Economic Benefits of Making Electrical Resources the Right Size. In it, they argued that the free market has already begun to favor distributed energy over centralized energy, as deregulation and restructuring “exposed the previously sheltered power-plant builders to brutal market discipline,” and shifted the economics toward local power. “Central thermal power plants stopped getting more efficient in the 1960s, bigger in the ’70s, cheaper in the ’80s and bought in the ’90s,” they write. “At the same time, new kinds of ‘micropower’ generators thousands or tens of thousands of times smaller — microturbines, solar cells, fuel cells, wind turbines — started to become serious competitors.”
Speaking by cell phone as he waits for a plane in Denver, airport alert bells and PA system announcements blaring behind him, Lovins has some advice for beleaguered utilities. “If you’re AT&T and somebody invents this new thing called a ‘cell phone,’ do you hunker down and just hope cell phones go away, or do you get into the wireless business?
“Utilities should be treating distributed generation as a source of profit and competitive advantage rather than as a competitive threat,” Lovins says. “It’s hard to get their heads around a lot of little things instead of a few big things, which is what they’re really good at. But if they want to provide low-cost reliable power for the least amount of risk, distributed generation can do it for them. The barriers to smaller systems are really cultural, not technical and economic.”
There are some signs that utilities, investor-owned and municipal, understand what it means to adapt, even if they haven’t embraced the change. Lovins notes that Idaho Power, an investor-owned utility in a state with no renewable energy goals, used to install, lease and maintain photovoltaic systems for its off-grid rural customers. The utility ended that program in 1997, a move its renewable energy specialist, Scott Gates, still laments. “I liked it,” he says. “It provided a real service, (and) it made financial sense, because we didn’t have to construct distribution lines at $20,000 a mile.” The program no longer fit with the utility’s post-deregulation business model, so it left the market to other solar providers. But Gates still writes checks at the end of the year to people who generate surplus power on their rooftops.
Southern California Edison is negotiating with state regulators to install 250 megawatts of distributed solar on rooftops leased from ratepayers, adding to nearly 450 megawatts of currently interconnected photovoltaics. Sempra Energy is using nine of Sopogy’s solar collectors to air condition a 45,000 square-foot office building in Downey, Calif. And while San Diego Gas & Electric’s plans for 52 megawatts of tracking photovoltaic panels were recently thwarted by regulators who deemed them overpriced (at $7 per watt), the utility has been busily installing “smart” meters in its customers’ homes and offices. The meters are one step toward a grid with advanced two-way communications to help utilities manage intermittent renewable power. It may also help integrate those plug-in hybrid cars that the new chairman of the Federal Energy Regulatory Commission, Jon Wellinghoff, envisions shoring up the grid over the next decade.
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On a November day in 2007, Con Edison severed the last wire from the only remaining power plant Thomas Edison had established in New York City. Edison built the city’s electrical framework based on a low-voltage direct current that could barely make it across the street, but many of the city’s old buildings had remained wired for it. The shuttering of the old power plant at 10 East 40th Street meant the utility had finally finished converting the city to alternating current. It was, reported the New York Times, “a final, vestigial triumph by Nikola Tesla and George Westinghouse.”
Then again, maybe not. For even as the city threw over Edison’s current, its energy planners have begun installing microturbines in office towers, fueling them with digester gas and recycling waste heat to warm the city’s buildings — in other words, steadily returning to the inventor’s distribution model, the one that required a power plant every mile or so. Had we followed that model all along, we might not now be wrangling with an invisible legacy of heat-trapping pollution.
Edison wasn’t right about everything. He spent decades battling Tesla’s technology, to no great purpose — these days, even the hamsters generate an alternating current. But the debate over local versus long-distance power may have finally tilted in his favor.
This article appeared in the print edition of the magazine with the headline Let’s Get Small.
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