Daily GPI / NGI All News Access

Distributed Power Faces Utility Opposition

Distributed Power Faces Utility Opposition

The technology and economics are in line for commercial expansion of distributed power, but progress is threatened by entrenched utilities, according to distributed power sponsors.

In the marketplace distributed power is winning increasing accolades for its reliability and peak-shaving potential, a panel of industry representatives told state regulators meeting in San Francisco earlier this month. Panelists urged members of the National Association of Regulatory Utility Commissioners (NARUC) to resist what they described as utility efforts to establish "disconnect charges" for customers choosing distributed generation and bypassing the local electric grid.

"If utilities put in disconnect charges for residential customers, they could stop distributed power in its tracks," said Gary Mittleman, president/CEO of two-year-old PlugPower, a marketer of a small residential natural gas-or propane-fired fuel cells. "And I am not talking about just fuel cells, I'm also talking about wind power, micro-turbines, everything. We need a level playing field."

Tony Prophet, president/CEO of Allied Signal Power Systems, maker of a commercial microturbine, said "models" are emerging for blocking distributed generation by the utility industry. "It is in the interest of the utility shareholders" to block distributed power. One tactic, Prophet contends, is for the utilities to refuse to connect with distributed power sources or to require each unit be dealt with on a case-by-case basis.

Reliability is no longer an issue. Prophet emphasized to the regulators that Allied Signal's demonstration units nationally have operated for up to two years in harmony with local grids, proving that the new, small power plants can co-exist with the centralized grid. "Our machines, in reality, have added to the reliability on the grid."

Dan Rastler, distributed power manager for the Electric Power Research Institute, Palo Alto, CA, told the regulators that decentralized small power plants-fuel cells, micro-turbines, wind power and others-are now viewed as good for individuals and good for utilities in providing an added measure of reliability. He said customers are concerned about a lot more than "just the cost of electricity," they are concerned about unmet needs that can be created by power quality blimps, outages, etc.

Both distributed power producers point to major corporate support. PlugPower, with Detroit Edison as a founding sponsor, has backing from Southern California Gas and from General Electric, which is the global distributor of the fuel cells in the residential and small commercial markets. The units are about the size of a dishwasher and range from 4 to 5 kW in size. Allied Signal, which earlier in the year acquired Honeywell, has alliances with Caterpillar, Ford and Emerson, and it has demonstrated its small megawatt-micro-turbines in a half dozen utility service territories representing a variety of climates and grid tie-ins. With peaks again rising to all-time records in California this summer, Robin Morrison, from the California Independent System Operator (ISO) drew short of endorsing distributed generation, but she noted that the Cal ISO "clearly is on the side of deepening our ancillary services markets" to lessen price spikes and curb peaks, and distributed generation is viewed as a way of taking some of the strain out of the distribution and transmission grids.

©Copyright 1999 Intelligence Press Inc. All rights reserved. The preceding news report may not be republished or redistributed, in whole or in part, in any form, without prior written consent of Intelligence Press, Inc.

ISSN © 2577-9877 | ISSN © 1532-1231
Comments powered by Disqus