20th Century Power System Incompatible with Digital
Economy
Study Calls for Greater Use of Micropower
July 15, 2000 - Today’s giant coal and nuclear power
plants are failing to provide the high-quality, reliable
electricity needed to power the new digital economy,
according to a new report from the Worldwatch Institute,
a Washington, DC-based research organization.
Power interruptions due to the vulnerability of central
power plants and transmission lines cost the United
States as much as $80 billion annually.
“We’re beginning the 21st century with
a power system that cannot take our economy where
it needs to go,” said
Seth Dunn, author of Micropower:
The Next Electrical Era. “The kind of highly
reliable power needed for today’s economy can only
be based on a new generation of micropower devices
now coming on the market. These allow homes and businesses
to produce their own electricity, with far less pollution.”
The new micropower technologies, which include fuel
cells, microturbines, and solar roofing, are as small
as one-millionth the scale of today’s coal or nuclear
plants—and produce little if any of the air pollution
of their larger cousins. Already, the multi-billion-dollar
potential of the market for micropower has sent investors
scrambling to buy into some of the new companies,
sending their share prices soaring earlier this year.
One group of micropower technologies generates electricity
by combustion. Reciprocating engines, traditionally
fueled by diesel oil and once used largely for backup
power, are increasingly fueled by natural gas and
run throughout much of the day. Microturbines, advanced
gas turbines derived from aerospace jet engines, are
just starting to be mass-produced, shipped by the
hundreds, and installed in drugstores, restaurants,
and other U.S. commercial buildings. Stirling engines,
which can run on wood chips and even solar heat, are
becoming popular in European homes.
Other micropower systems rely on processes that do
not involve combustion. Fuel cells are electrochemical
devices that combine hydrogen and oxygen to produce
electricity and water. Several hundred fuel cells
are already operating worldwide, and will become commercially
available for homes in the next one to two years.
Solar cells, or photovoltaics (PV), which use sunlight
falling on semiconductor chips to produce electric
current, have already entered the residential and
commercial building market in nations such as Japan
and Germany, and for off-grid use in developing nations.
Wind power, the most cost-competitive renewable energy
technology, is poised for rapid expansion in rural
plains and offshore regions. Small geothermal, microhydro,
and biomass systems also hold important roles in the
emerging decentralized electricity system.
These small-scale generators have numerous advantages
over large-scale power plants. Located close to where
they are used, small-scale units can save electricity
consumers millions of dollars by avoiding costly new
investments in central power plants and distribution
systems.
Micropower can also save homeowners and businesses
millions of dollars by lowering the threat of power
outages and subsequent lost productivity. An electricity
grid with many small generators is inherently more
stable than a grid served by only a few large plants.
Banks, hospitals, restaurants, and post offices have
been among the early adopters of micropower systems
as a way to reduce their vulnerability to power interruptions.
The First National Bank of Omaha, in Omaha, Nebraska,
for example, responded to a costly computer system
crash in 1997 by hooking its processing center up
to two fuel cells that provide 99.9999% reliability.
Use of more efficient combustion-based micropower
systems, relying primarily on natural gas, will substantially
lower emissions of particulates, sulfur dioxide, nitrogen
oxides, and heavy metals. These reductions would range
from 50 to 100 percent, depending on the technology
and pollutant.
The use of wind, solar power, and fuel cells fueled
by hydrogen can also help reduce global carbon dioxide
emissions, one third of which come from electricity
generation. In the United States, widespread adoption
of micropower could cut U.S. power plant carbon dioxide
emissions in half. In developing nations, small-scale
power could lower carbon emissions by 42 percent relative
to large-scale systems.
Micropower will allow developing countries to leapfrog
to power sources that are cheaper and cleaner than
building more coal or nuclear plants and extending
existing transmission lines. Many of these countries
lose the equivalent of 20 to 50 percent of their total
power generated through leaks in their transmission
and distribution systems. In rural regions, where
1.8 billion people still lack access to electrical
services, small-scale systems are already economically
superior to the extension of transmission lines—and
environmentally preferable to continued reliance on
kerosene lanterns and diesel generators. To date,
solar PV systems have been installed in more than
half a million homes.
Despite micropower’s potential benefits, current
market rules in most countries favor the incumbent
centralized model. Many electric utilities, moreover,
perceive micropower systems as an economic threat,
and are blocking their deployment by charging onerous
connection fees and by paying low prices for power
fed into the grid. Failure to reform these rules and
practices could result in the construction of another
generation of marginally improved large-scale power
plants of questionable long-term economic and environmental
value.
The extent to which current power markets favor short-sighted
solutions is highlighted in the rush to construct
some 100,000 megawatts of “merchant plants” worldwide.
These large gas-fired power plants, marketed as the
answer to power shortages, are designed to make money
by selling power in newly deregulated electricity
markets when demand and prices are high. But they
have raised serious concerns among investors for their
financial riskiness, and among grass-roots groups
for their negative ecological impacts—as many are
located in rural or pristine areas.
The risk of locking in outdated central power plants
is even greater in the developing world. Over the
next 20 years, some $1.7 trillion of capital investment
in new power capacity is projected to take place in
developing countries. “These nations have a golden
opportunity to get the rules right the first time,
and set up markets that support power systems suitable
for the 21st century and not the 20th,”
concludes Dunn.
FOR MORE INFORMATION, CONTACT:
Seth Dunn,
Author, sdunn@worldwatch.org.
Mary Caron, Press Director, mcaron@worldwatch.org.
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