The technology and economics are in line for commercialexpansion of distributed power, but progress is threatened byentrenched utilities, according to distributed power sponsors.

In the marketplace distributed power is winning increasingaccolades for its reliability and peak-shaving potential, a panelof industry representatives told state regulators meeting in SanFrancisco earlier this month. Panelists urged members of theNational Association of Regulatory Utility Commissioners (NARUC) toresist what they described as utility efforts to establish”disconnect charges” for customers choosing distributed generationand bypassing the local electric grid.

“If utilities put in disconnect charges for residentialcustomers, they could stop distributed power in its tracks,” saidGary Mittleman, president/CEO of two-year-old PlugPower, a marketerof a small residential natural gas-or propane-fired fuel cells.”And I am not talking about just fuel cells, I’m also talking aboutwind power, micro-turbines, everything. We need a level playingfield.”

Tony Prophet, president/CEO of Allied Signal Power Systems,maker of a commercial microturbine, said “models” are emergingforblocking distributed generation by the utility industry. “It is inthe interest of the utility shareholders” to block distributedpower. One tactic, Prophet contends, is for the utilities to refuseto connect with distributed power sources or to require each unitbe dealt with on a case-by-case basis.

Reliability is no longer an issue. Prophet emphasized to theregulators that Allied Signal’s demonstration units nationally haveoperated for up to two years in harmony with local grids, provingthat the new, small power plants can co-exist with the centralizedgrid. “Our machines, in reality, have added to the reliability onthe grid.”

Dan Rastler, distributed power manager for the Electric PowerResearch Institute, Palo Alto, CA, told the regulators thatdecentralized small power plants-fuel cells, micro-turbines, windpower and others-are now viewed as good for individuals and goodfor utilities in providing an added measure of reliability. He saidcustomers are concerned about a lot more than “just the cost ofelectricity,” they are concerned about unmet needs that can becreated by power quality blimps, outages, etc.

Both distributed power producers point to major corporatesupport. PlugPower, with Detroit Edison as a founding sponsor, hasbacking from Southern California Gas and from General Electric,which is the global distributor of the fuel cells in theresidential and small commercial markets. The units are about thesize of a dishwasher and range from 4 to 5 kW in size. AlliedSignal, which earlier in the year acquired Honeywell, has allianceswith Caterpillar, Ford and Emerson, and it has demonstrated itssmall megawatt-micro-turbines in a half dozen utility serviceterritories representing a variety of climates and grid tie-ins.With peaks again rising to all-time records in California thissummer, Robin Morrison, from the California Independent SystemOperator (ISO) drew short of endorsing distributed generation, butshe noted that the Cal ISO “clearly is on the side of deepening ourancillary services markets” to lessen price spikes and curb peaks,and distributed generation is viewed as a way of taking some of thestrain out of the distribution and transmission grids.

©Copyright 1999 Intelligence Press Inc. All rights reserved. Thepreceding news report may not be republished or redistributed, inwhole or in part, in any form, without prior written consent ofIntelligence Press, Inc.