Micro-Generation: Small Power with a Big Impact

"Bigger is better" would fit the bill nicely if you had to pick a theme to describe the evolution of Alberta's electrical power system. Just like the rise of big-box stores and the domination of a few giant automobile makers, our power grid is characterized by large, centralized power sources that require massive networks to deliver energy to several million consumers spread across a wide area.

The advantages of these large-scale economies are obvious. What is less understood are the challenges that come with a growing population that expects power at the touch of a button and infrastructure that becomes more fragile and less efficient all the time. Alberta has reached a crossroads as aging power lines, record-breaking usage, land-use conflicts for distribution systems and environmental concerns about power generation force citizens, industry and governments to take a hard look at how to keep the electrons flowing most effectively.

A key solution lies in reversing the large-scale, centralized trend and recognizing the value of small-scale, diffuse power generation. Known as micro-generation or distributed generation, the concept is simple: Reduce your reliance on a small number of big power plants by supplementing them with a large number of small, localized generation systems. Think neighbourhood corner stores instead of Wal-Marts. And judging by recent events - including a new provincial energy strategy that calls for increased emphasis on renewable energy and more efficient power generation - it's an idea whose time has arrived.

"Distributed generation has the potential to facilitate many of the goals we commonly talk about, specifically improving the efficiency and resiliency of the electricity system, the inclusion of renewable energy and reductions in greenhouse gas emissions from the electricity system, " says John Rilett, Vice President of Climate Change Central.

Micro-generation can take many forms. But it generally means energy sources not completely reliant on the larger electrical grid but connected to it so as to sell unused electricity back to the system and buy it, when needed. In this way, homeowners and operators of small generation systems are able to achieve a measure of energy independence and realize financial benefits that can help offset the costs of adding power-generating technology to residences.

In Alberta, micro-generation is defined as up to one megawatt of electricity produced from renewable sources such as solar, small-scale hydro, wind or biomass. Power can also be derived from high-efficiency co-generation (combined heat and electricity generation) or fuel cells.

The benefits of such systems boil down to increased efficiency, less pollution and a broadening of the province's electricity pool, which can help strengthen the entire system, according to Anouk Kendall, President of World Alliance for Decentralized Energy Canada (WADE Canada) and Vice President, Sustainable Energy Systems of IRIS Environmental Systems Inc.

"Assuming modernization of our aging grid, decentralized energy can ensure reduced electricity demands, greater power quality, reduced vulnerability of the grid and increased self sufficiency," Kendall says. "It is a good solution for electrifying remote areas, and in more populated areas, it can reduce air pollution and improve quality of life."

When it comes to meeting international climate change obligations, Alberta may stand to gain the most of any province from micro-generation. With almost 90 per cent of its electricity generated from coal- and natural gas-fired plants, and demand expected to rise by more than one-third over the next decade, shifting part of the load to renewables will be necessary to slow or reduce the province's greenhouse gas emissions. Even fossil fuel-powered micro-generation can make a big difference, since heat and power co-generation is vastly more efficient than traditional large-scale electric and heating systems.

A new report on low-carbon energy by the Worldwatch Institute estimates most power plants lose two-thirds of their energy in waste heat and transmission loss and that capturing wasted heat to produce electricity and heat buildings can increase efficiency by up to 90 per cent. Canada currently has one of the highest per-capita rates of electricity use in the world, with one-third of its greenhouse gas emissions coming from electricity generation. Therefore, a large dent in its emissions from electricity will be necessary to achieve the daunting task of slashing greenhouse gas emissions by at least half by 2050.

Micro-generation also promises to play a key role in Canada's ongoing efforts to reduce carbon dioxide output by promoting the three pillars of energy efficiency, conservation and renewable energy. A survey of community-based energy plans by University of Waterloo researchers Genevieve St. Denis and Paul Parker found that adopting renewables has taken a back seat to the more consumer-focused approaches of encouraging conservation and efficiency. This trend may be changing, however, as jurisdictions across the country update their electricity regulations and remove many of the bureaucratic barriers standing in the way of small-scale power systems.

In Alberta, this has taken the form of Rule 024, which streamlines the approval process for micro-generation applications and allows individuals to connect their systems to the grid, as of January 1, 2009. This approach has been bolstered by Energy Minister Mel Knight's recent release of a new provincial energy strategy, which seeks to diversify the energy mix and modernize the grid.

"The micro-generation regulation shows that Alberta is beginning to shift towards a closer relationship between supply and demand, so that generation of energy is closer to the end user," Kendall says. "We took a brave step in restructuring our electricity industry, but our generation and delivery of power still has fundamental challenges, and so far our rate of progress has been slow."

As you will read in this edition of C3 Views, micro-generation is already proving its worth at the community level in Alberta. This includes three "net-zero" homes that produce more electricity from solar power than they use, a fire hall in Grand Prairie powered by a small wind turbine, and the City of Calgary-owned Enmax taking steps towards supplying customers with residential-sized solar, wind and natural gas co-generation units. Nationwide, distributed generation now accounts for more than one-quarter of all new power being installed.