High natural gas prices and uncertainty about the regulatory landscape from state to state make it difficult for distributed generation to take hold as a means of forestalling future transmission line upgrades without first gaining utility sponsorship . Most installations don’t pencil out on a strictly on-site power-production basis, according to a San Diego-based consultant who talked with NGI/Power Market Today last Tuesday.

Large industrial/commercial customers must want reliable back-up power and/or large amounts of waste heat for most distributed generation (DG) projects to make economic sense today, said David Field, president of San Diego-based Utility Infrastructure Partners, which as the name implies is in the business of getting utilities to become sponsor/marketers of DG systems to their key customers as a grid management tool.

“For customers who want DG for back-up power, you have to size it over the needs of the facility,” Field said. “That way, by over-building, if the grid goes down, a facility can back up 100% of its power needs.

“Looking at that marketplace last year, we realized you have to get more value out of these cogeneration units for there ever to be a market for DG in the United States. And that is where the utility focus really came into play — reducing or eliminating the need for new transmission, primarily eliminating line losses, or the need for new upgrades and providing utilities with capacity value.

“When you add up those components, you have a compelling argument for Southern California Edison Co. or PG&E, for example, to install DG for their large commercial/industrial customers at locations where it benefits the grid.”

Reciprocating engines currently look like the best fit in most industrial applications, said Field, noting that micro-turbines and fuel cells have niches. The small turbines, particularly, work well where the customer has a significant heat requirement because they have very high heat rates – a factor that makes their power production less economic in some applications.

“It works fine if you have a significant heat requirement, but it is not a grid electrical substitute,” Field said.

Capstone Turbine Corp., the Chatsworth, CA-based pioneer in the micro-turbine field that has had mixed results in its worldwide marketing effort, nevertheless thinks there are enough unique installations and a common need for waste heat to keep the firm’s 30 kW to 60 kW units in the mix in a variety of applications, such as a major Sanyo chemical plant in Japan. Its product — a chemical polymer used as a drying agent in disposable diapers — demands that no hazardous liquid vapor be used in the process, which is ideal for the waste heat produced by an array of 44 60-kW Capstone micro-turbines.

At the landfills, the micro-turbines have the advantage of being able to produce power using a relatively low-Btu gas emanating from the buried refuse that would not be useable by itself with reciprocating engines or other thermal power options. “In these cases, there are over-riding circumstances that favor micro-turbine technology,” said Keith Field, a Capstone Turbine spokesperson.

In the case of the Sanyo plant, any hazardous liquids’ vapor coming in contact with its chemical polymer product would render the polymers useless, making the waste heat generated by the micro-turbines an ideal solution. The array of 60-kW units totaling 2.6 MW provided a million dollars worth of electricity along with providing a clean source of heat that would not give off any oil products.

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