Centralized electricity production made sense in the 20th Century. Here's why:
- Energy was cheap so it could be wasted. 80% of the energy used in electricity production and transmission is lost as heat. However, that isn't true anymore (either in absolute cost or costs relative to income).
- Transmission capacity was on the rise. Unfortunately, investments in transmission haven't grown in 30 years and NIMBY is preventing any improvement. Transmission lines are already saturated.
- Little chance of disruption. Systems disruption as a means of warfare is on the rise. Also, breakdowns in an overtaxed transmission system cause $100 billion a year in damage, due to dirty power, in end-user equipment.
Micropower
Fortunately, new technologies now make it possible to generate electricity at the level of the home, business, or urban building. This technology, called Combined Heat Power (CHP) or cogeneration (lots of resources are available on this topic). In microCHP systems, you either generate electricity as a byproduct of heating or heating as a byproduct of electricity generation. It does the following:
- It allows production of electricity within the structure it will be used. Eliminating transmission losses.
- Waste heat generated by the production of electricity can be used to heat water or the home/building. That means the 80% of the energy that would have been lost is now put to use.
- It makes electricity both resilient and clean. Transmission breakdowns have zero effect on the end-user. Further, the power is clean/smooth, generating little damage to connected equipment.
Gaps in the Marketplace
Unfortunately, despite the advantages, there are significant gaps in the marketplace for products that are truly resilient. This is a significant opportunity for commercial entrepreneurs and DIY developers. Truly resilient products would provide:
- Biomass (pellets, etc.) burning. Existing commercial microCHP systems use natural gas. Residential biomass CHPs are the next step and would likely sell like hot cakes (pellet stoves are).
- Generic stirling CHP systems. These systems would allow you to switch the source of heating from natural gas to biomass to concentrated solar. In short, you could optimize depending on costs/availability.
Network Effects on Resilience
Micropower becomes extremely interesting when combined with Microgrids (see the brief: Microgrids for more). Connectivity to a Microgrid would ensure that a community continues to have power even if the national grid is inoperative. Further, if the community Microgrid is smart (meaning it carries data on pricing, etc in addition to power), it would allow local markets to develop. Not only would the individual producer be paid for the production (at end-user rates minus a small transmission charge), they would be incentivized to optimize/grow.