The 1978 Public Utility Regulatory Act encouraged on-site generation to use the energy normally wasted in large remote power plants for hot water and steam. Now the idea is emerging again with a new name: distributed generation. It could be the solution to power shortages and rolling blackouts. Contractors might do well to keep up with these developments.

Distributed generation, or as some call it, distributed resources, includes energy produced by micro-turbines, fuel cells, photovoltaics, wind, and geothermal sources, to name some of the more common forms. Electrical contractors will find new installation and maintenance opportunities if they choose to pursue them. Ronald D. Earl, CEO of Illinois Municipal Electric Agency (IMEA), forecasts: “The day is not far away when we are going to be able to bring distributed generation to each individual household.”

Driver No. 1—Transmission congestion

Besides energy efficiency, there appear to be three new drivers of this trend: the need to bypass transmission congestion; the demand for ultra-reliable power; and the availability of new technologies. Earl expresses the first driver of IMEA’s program, which provides vital protection against transmission congestion. The IMEA distributed generation approach provides heightened reliability for its member utilities as well as placing dollars back in member communities and improving the local communities’ infrastructure. The program also promises to enhance the municipal utilities’ relationships with large customers and has a lower environmental impact than alternative approaches, according to Earl, since several scattered two-MW plants do not raise environmental concerns as larger plants do.

Driver No. 2—Ultra-reliability

The second major driver of distributed generation is the increasing need for ultra-reliable power. Typically, the 99.9 percent reliability provided by traditional electric utilities can result in the risk of power loss for over eight hours per year. For modern, data-centric facilities, this is unacceptable, because most require reliability to “six nines,” i.e., 99.9999 percent.

The traditional electric power grid is getting less dependable. James Amato, CEO of EPI General Contractors, Van Nuys, Calif., notes that reliability was the major issue for a company in Northern California, that disconnected from the grid and installed Capstone micro-turbines. The Capstone micro-turbine installation was a heavy capital expenditure but worth it for increased reliability. Noting that “we’re in it for the long haul,” Amato said alternative sources of energy are a very important aspect of our economy, since “we’re too dependent on large energy companies.” Capstone’s home page is at www.microturbine.com.

Obviously, on-site generation could replace much central power and extend the useful life of the grid. And, with more people working at home in computer-dependent jobs, the need for highly reliable power has surpassed predictions. For example, the forecasted load in California for 2005 was reached this past summer, five years ahead of schedule.

Driver No. 3—New technology

The third driver of distributed generation is new technology. Several technologies that previously were too costly are now becoming competitive with the cost of deregulated power. They have attracted a flood of venture capital and now are ready for volume manufacturing. Virtually all of them are small-scale systems, also called “micro-generation.”

New technology micro-generators are small by comparison to central plants, ranging from a few KW to power a single-family house to a few hundred KW for a small commercial facility. There are power plants you could mount next to the air conditioner or even in the basement. These environmentally friendly power plants produce only a fraction of the pollutants of larger plants. Larger units may even produce up to several MW.

These technologies use advanced materials, sophisticated power electronics, and novel electrochemical processes. Some were developed for aerospace applications and defense uses that were far too expensive for commercial markets until now. For example, hydrogen fuel made by reforming fossil fuels or electrolyzing water to run low-temperature fuel cells has attracted several producers and many capital investors recently after being used for many years to power U.S. space vehicles. Proton Energy Systems is manufacturing electrolyzers to make almost pure hydrogen from water. The product is about the size of a dishwasher. If the fuel is hydrogen, the only effluent from the oxidation process in a fuel cell is chemically pure water. A novel approach to fuel cells pioneered by Metallic Power uses zinc pellets or foil as fuel. Once oxidized in the cell, the zinc fuel can be regenerated and reused—a recyclable fuel. This company recently obtained new venture capital amounting to $18 million.

New technologies for distributed generation include fossil-fueled micro-generation. They range from dramatically re-engineered reciprocating engines that burn natural gas or propane, to new micro-turbines that operate at up to 60 percent efficiency. The excess heat can be captured and put to use, raising the net system efficiency to over 70 percent. Increasingly popular are small power plants such as the micro-turbines produced by Capstone Turbine Corporation, which have been installed in a wide variety of applications worldwide. They are ultra-reliable and require little maintenance, as they have only one moving part that requires no lubrication.

One traditional construction firm that sees the potential is Harza Engineering Company Inc., which formed a new energy services company focused on power systems and distributed generation. Harza Energy, LLC, will focus on providing turnkey energy solutions to fill the needs of small commercial clients, large industrial users, local communities, large government agencies, municipal electric suppliers, and utilities. Stephen J. Chippas, an 11-year Harza veteran with an extensive background in both the technical and legal aspects of power projects, will lead Harza.

“Harza has been a leader in the field of power and energy for more than 80 years. We see Harza Energy as our vehicle to continue that leadership in the area of distributed generation and resource recovery projects,” said Harza President and CEO Dr. Refaat A. Abdel-Malek.

Plans include a strategic alliance in which Harza will serve as a nationwide provider of Capstone MicroTurbine power systems for use in various distributed generation and resource recovery projects.

Eric Fox, sales manager at Harza for the Capstone micro-turbine project, says micro-turbines are “miles ahead of fuel cells in production and pricing.” The distributed generation business is relatively new for Harza, but they are aggressively pursuing it, Fox said. He is identifying areas all over the country that have certified contractors to install micro-turbines.

Mark Kuntz, vice president of marketing for Capstone, said initially he thought that mechanical contractors were going to be the most needed because the turbine is a mechanical device. But then he realized that, because of interconnections with the building, the necessary system synchronization, and the complex parts of the installation, the balance was shifting to electrical contractors. He advised, “The key for electrical contractors is to regard micro-turbines as an emerging product unlike anything that they have worked with. Micro-turbines are not just stand-by generators. Micro-turbines are a totally new way; the grid then must be regarded as a backup rather than vice versa. Electrical contractors are in a good position to identify cases where reliability might be a problem. They need to know about micro-turbines.”

Sasco Electric employees who have wired seven micro-turbines at Capstone headquarters in Chatsworth, Calif., report that the actual hookup of micro-turbines is relatively uncomplicated. However, providing initial installation planning, maintenance, and on-going technical service is another matter. Capstone offers a five-day service and installation course for this purpose.

Kuntz noted that the attendees are from the electrical contracting world and further explained, “We have targeted some ESCOs whom we perceive to be aggressive in the marketplace and forward-looking with regard to technology and have approached them. Just as frequently, though, ESCOs who want to get into the distributed generation business approach us.” As of this writing, about 20 firms from the United States and Europe have participated in the certification sources.

Non-polluting efficiency

Micro-turbines are very efficient, since they can run on different fuels, such as propane. Also, combined heat and power can be recaptured, increasing efficiency even more. Most micro-generators using renewable resources are intrinsically non-polluting. Perhaps the most exciting of these technologies is photovoltaics, which produce electric power from sunlight shining on a photocell made from a semiconductor similar to those used in integrated circuits or computer chips. Both large and small companies are striving to reduce manufacturing costs, so these devices can compete with the other forms of generation.

The U.S. General Services Administration (GSA) contracted with Pepco Energy Services, Inc., in partnership with Applied Power Corp., to construct one of the largest photovoltaic arrays in the country. Pepco Energy Services, a wholly owned, separately managed subsidiary of Potomac Electric Power Company (NYSE: POM), served as the general contractor and project manager of the system. Meanwhile, Applied Power Corp. designed and installed the solar equipment at the Federal Center in Suitland, Md., southeast of Washington, D.C. The GSA funded the generation station to support the Planet GSA program, the “President’s Million Solar Roofs Initiative” and the goals of “Executive Order 13123.”

The project will showcase how quickly and easily amorphous silicon technology can meet the energy needs of many different types of commercial and industrial facilities. Unlike polycrystalline silicon technology, which has been in use for more than two decades, amorphous silicon technology is an advanced cell material that performs better under high ambient temperatures and costs less to manufacture. The photovoltaic power system consists of an array of 2,800 modules that convert sunlight into 100 kilowatts of electric power. The solar-generated electricity will provide power for the central cooling plant at the Suitland , Md., Federal Center.

“This system demonstrates the General Services Administration’s commitment to a cleaner tomorrow,” said GSA’s Anthony Costa, assistant regional administrator for the Public Buildings Service in the national capital region. “The President has set a goal for the federal government of 2,000 solar energy installations by the end of this year, and the GSA is helping to make that goal a reality.”

Technical and regulatory challenges

A significant technical issue arises when a kilowatt size micro-generator is part of a system that must be interconnected and synchronized with the power grid. Engineer Kenneth R. BuShea and CEO of Teamwork-net, Inc. outlined for Transmission & Distribution World what is needed. There must be a new parallel transparent interconnect (TI) capable of meeting the following criteria: since it cannot rely on technical skill of its users, the TI must be fully automated; the system must earn the full confidence of operating utilities in safety, transparency, and reliability; the system will have to react automatically to internal and external faults and be capable of automatic re-synchronization; it may require a full dual-redundant synchronizing system with automatic switch-over to meet the full transparency criteria; the system will need to automatically alarm a remote service center so that repairs can be accomplished through telemetered control indications to the dispatch center; the designer may need to use multiple smart processors for self-diagnostics; and the end-user must anticipate a return on investment for the technology to gain widespread acceptance.

With generation now deregulated but states still regulating power distribution, the side of the meter on which the distributed generation is installed matters. If multiple micro-generators are installed on the customer side, rules may classify the user as a utility subject to state laws. The Distributed Power Coalition of America includes members among manufacturers, utilities, and users working hard to help resolve such issues so the distributed generation market can move forward. As James Amato of EPI said, “Market awareness will eventually come.”

TAGLIAFERRE, is proprietor of the C-E-C Group in Springfield, Va. He can be reached at (703) 321-9268, or by e-mail at lewtag@aol.com. GREENWOOD has been a lecturer with the University of Maine’s Department of Sociology for 13 years. She can be reached at susanfg@maine.edu or (207) 581-2394.