August 18, 1998
Distributed power generation can ease transmission problems
As summer continues, electric power prices are up and some consumers are worrying about whether they will be able to get electricity when they need it. One problem facing both utilities and power users is that -- even though reasonably priced power might be available -- in hotter-than-normal weather transmission facilities may be so overloaded that it just isn't possible to transport available power to places where it's needed. Restructuring of the electric industry is improving access to the transmission grid, but in some places the grid isn't capable of meeting unusual demands. Siting new power lines can be difficult, and planning for transmission system expansion is likely to be particularly challenging while the industry remains in transition.
One of the answers is to reduce the pressure on constrained transmission with public policies that encourage the development of distributed power - that is, power generation from relatively small facilities located at dispersed sites closer to end users than standard central power stations.
Natural gas generators can mitigate problems on the grid
Today, new technologies are emerging, making it possible for dispersed, small-scale generation to meet the needs of a restructured industry. For example, several manufacturers are on the brink of making micro turbines (25 to 300 kW) commercially available at reasonable prices. Also, other emerging small-scale generation options, like fuel cells, will soon provide a cheaper, more reliable alternative to expansions of the existing electric system (composed of large central plants and transportation along the traditional utility grid). Already, proven products like highly efficient natural gas-fired turbines and reciprocating engines are available to offer cost-effective, environmentally friendly solutions for many generation requirements ranging in size from 25 kW to 5 mW. Virginia Power, for example, recently asked the State Corporation Commission for certificates of public convenience and necessity to build and operate five natural gas-fired combustion turbine peaking units.
Easily installed natural gas-fired distributed generation can ease the impact of heat waves on communities where the transmission system just isn't adequate to meet a higher-than-normal demand for power. Small units can be located at or near customer facilities or close to electric transmission bottlenecks, especially where power lines cross gas facilities. Gas turbines, for example, can meet the need for "peaking" in periods of high demand because they require short start-up times to reach full production. And it is easier to locate clean burning, combined-cycle gas generators - compared to traditional large generation plants - near densely populated areas. Generally, where demand for power is outstripping generation or transmission capacity, gas-fired generation can provide a solution.
Another advantage of natural gas-fired generation for summer peaking is that while the electric system is at its peak in hot weather, the natural gas system is largely under-utilized since natural gas is mainly used for winter heating. The inherent counter-cyclical nature of gas and electricity demand provides for an abundance of siting locations for natural gas-fired generation on both natural gas transmission systems and more localized natural gas distribution systems. Restructuring policies should foster distributed power generation plants.
While distributed generation has been talked about for years, development has been hampered by utility policies that limit access to the power grid. The potential of distributed power has become more immediate since FERC issued Order 888, but obstacles remain, including the lack of uniform standards for interconnection with utility distribution and transmission facilities. And, if the potential of dispersed, small-scale generation isn't kept in mind, regulatory policies regarding transmission pricing or facility siting can effectively limit the access of new generators to the marketplace. The Virginia General Assembly can foster the development of these new technologies by explicitly recognizing the importance of distributed power technologies in its electric restructuring legislation.