Recent, prolonged power outages caused by Hurricane Sandy and other severe weather events caused many people to ask themselves as a homeowner or business person, “What can I do to operate my home or business and maintain safety, basic amenities and the information and communications I need when the grid is down?”
Those who can afford it install backup engine/turbine generators, but fuel can be difficult to obtain during emergencies. And backup engine/turbine generators still burn carbon and are not particularly efficient. A more convenient and sustainable solution may eventually include installing DC sources (e.g., solar photovoltaic panels, fuel cells, battery storage, even EVs/PHEVs) that directly power DC end uses on the premises, including lighting, computers, other electronics and appliances. The steadily declining cost and improving performance of all of those DC sources will accelerate uptake. In fact, DC end uses make up a rapidly increasing proportion of total retail energy consumption. Of course, today’s electric end uses, including electronics, are wired for AC, and appliances driven by electric motors (refrigeration, compression, transport) will likely continue to be, so this solution won’t happen quickly and it’s not comprehensive. But affordable DC-to-DC subsystems will find a market.
The value of these “nanogrids” will not be limited to backup for occasional grid outages. Customers may continue to operate them as isolated systems even when the grid power is available to displace utility costs, reduce their carbon footprint, improve energy sustainability, avoid transients and harmonics from the AC grid, or just achieve some measure of independence and control.
Many utilities are pondering that now. In the near term, unless it is limited to charging batteries with grid power, these nanogrids will reduce total energy consumption and, therefore, reduce an electric utility’s revenues. But the utility may not experience an equal reduction in costs, so that may lead to kilowatt-hour price increases. The potential for decreased revenue is why utilities have focused on demand response instead of energy efficiency and conservation. Customer self-sufficiency also undercuts efforts by investor-owned utilities to invest in and earn a return on their infrastructure, not to mention the foundation for their good credit in the financial markets. And it introduces new variables and complexity to the operation of the legacy grid.
The fact remains that utilities cannot spend their way to a perfectly reliable grid, and their customers cannot tolerate being without power for days or even weeks. At the same time, legislators and regulators are becoming more aggressive in requiring that utilities increase their conservation and renewable energy efforts as well as reduce their carbon emissions. Utilities must get ahead of the curve and offer alternatives to customers or the dreaded disintermediaries will.
Solar PV is already being deployed widely in both developed and developing economies. Two drivers push down the cost of solar PV: First, the cost of the technology itself, which is declining steadily, and second, the cost of manufacturing, which decline with economies of scale. The world’s emerging economies will adopt solar PV systems in such quantities that global prices will drop low enough to energize customers in the U.S. and other developed countries to adopt them. Most of the global population does not already have a legacy, centralized power grid. And less than one-fourth of the world’s population uses more than three-fourths of the world’s electric energy. More than a billion and a half people in the world have no access to electricity at all. The rest of the world will catch up.
A relatively modest solar PV array for DC-based electrical loads that include LED lighting, Internet access, computing and telecommunications could not only change a person’s life, it could also benefit commercial facilities and entire industries, and drive economic growth in economies lacking a centralized grid. The number of kilowatt hours needed is modest in large sectors of emerging economies — just a fraction of the energy density Americans enjoy. So I don’t think this is much of a stretch. In fact, I’m sure it’s being done now. And when that movement takes off, it’ll bring economies of scale to PV production and Americans will adopt this form of DC generation in much greater numbers.