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The Future Of Microgeneration

Microgeneration (home power generation) has been talked about for 10 years at least. Why are adaption rates so low? And what can be done about it?

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What is the future of microgeneration and how will it affect the traditional commercial electric grid?

Let's begin by defining micro-generation.

As the name implies it is the generation of electricity using renewable technologies such as solar and wind power on a micro level. This means that instead of having large commercial electric utilities that deliver energy to everyone on a macro level each home or building would be generating their own electricity using one or more of several renewable sources including solar, wind or geo-thermal technologies.

Microgeneration represents a very big change from the centralized energy model we have always relied upon.

For over a decade micro generation has been hailed as the wave of the future but adaptation rates are still low. So, what are the barriers and obstacles? What actions can be taken to hasten micro generation capacity as part of an overall program to reduce reliance on fossil fuel generation and green house gasses?

Constraints To Microgeneration Adaption And What To Do About It


The ability to manufacture solar and wind technologies inexpensively and on a mass unit level are still a problem because demand remains low for micro-generation due to the continuing low cost of centralized distributed energy. This fact restricts the development of micro-generation companies to reach scale economies for manufacturing so that prices will drop.

Efforts are needed on a government level to stimulate demand. That can occur in a variety of ways but until the cost of distributed energy rises to a level that is unsustainable or governments make it more attractive to enter the micro-generation market for consumers to stimulate demand we will continue to witness slow adoption.


Although there are several micro technologies that lay at the lower end of the cost spectrum adaptation rates remain low. This indicates there are other issues affecting the growth of micro-generation. Attitude is certainly one of the problems. For those who live in countries that have easy and inexpensive access to centralized electricity it is difficult to develop a change in attitude towards saving energy and using clean renewable energies. Although people may say they are committed to saving energy the facts indicate differently. Even no cost energy saving tips are often times ignored so we have to ask why this happens. In many cases it is a lack of information and promotion. If governments aren't making the issue a priority and they fail to promote it constantly and underpin it with disincentives such as penalties for failing to recycle etc. people have little incentive to change their existing energy consumption patterns.

Another area is that of product quality and installation. Without a solid certification program for micro-generation technologies, performance and installation guarantees people are less likely to jump into the market. Uncertainty is a prime motivator for staying on the sidelines and observing rather than participating.

There is a critical need for objective information for both the independent consumer and localities. Issues such as zoning restrictions, planning permissions etc. are often times difficult to find. Lack of information about basic planning, zoning and safety considerations hinders people who may be ready and willing to invest in micro-generation. Making information easily available is an immediate need to encourage greater participation in energy saving behaviors and micro-generation installations.

Lastly, without good performance information on microgeneration products and installation requirements builders shy away from using technologies they do not understand, that are new and that are not well-documented and proven.

Government Policy

Countries need to look at how they can simplify the regulatory environment and government policies so that there is minimal regulation around the installation of individual solar, wind and geo-thermal technologies.

Local, state and country government need to make renewable technologies as accessible as possible. Zoning must accommodate a move towards allowing wind turbines and solar arrays or solar tiling on roofs in areas which are not subject to tornado and hurricane winds. Feed-in tariffs to offset the costs of micro generation must be established and ways to work with centralized energy distributors (electrical utilities) through net metering and perhaps other formats will be required.

Governments also need to provide the funding to help people enter the micro-generation market. This means ways of reducing upfront costs by factoring in the value of energy generated by the micro system over time and providing that benefit upfront to customers in the form of rebates, lower down payments, leasing programs through the government or their agents. This would go a long way towards helping people enter the micro generation market.

Technical Constraints

There are still many issues that exist around metering, connecting into the existing distribution system and how to balance out the input of energy into the grid with the energy taken from the grid which is referred to as balance and settlement. Although new metering equipment isn't required for the installation of microgeneration technology to be implemented,the ability to have net metering is a requirement under balancing and settlement codes if utilities are going to be able to receive credits for their customers who export power to the grid and figure out how to deal with Roc's and carbon cap and trading issues.

The existing centralized energy grid needs to begin the process of figuring out how large scale micro-generation will affect grid performance and stability. Because the number of micro-generation units are currently so low the impact on the centralized grid has been minimal but as micro-generation grows and begins to exert a macro effect the grid will need to find new ways of balancing available and peak power to avoid overloads and system imbalances due to so much export of energy into the grid from micro sources.

Regulatory Constraints

Regulation has an important role to play in helping to develop a sustainable market. Essentially planning and permitting inhibit microgeneration in two ways:

  1. The existing planning permissions required for the installation of micro-generation on existing houses.
  2. Regulations governing the planning requirements for new housing developments.

Existing regulations are often lack clarity, involve highly complex processes to apply and receive a planning or building permit and in many cases the rules are subject to differing interpretations by local authorities making it a frustrating and time consuming process. Delays can translate into increased costs so regulatory issues drive down demand.

Measure To Increase Adaption Rates

What do all of these constraints mean for micro-generation in the future?

It means that the development of micro-generation will continue to grow slower than originally predicted back in the 1990's but there is little doubt that micro-generation will get more and more attention as we move closer to 2015,2030 and 2050.

What can be done to speed up adaptation rates of micro-generation?

  • Governments must implement policies that drive a strong micro-generation incentive. From easing planning, permitting and zoning regulations to providing extra incentives and purchase programs that ease the entry cost into the micro-generation market.
  • Pressure must be brought to bear on public utilities to find solutions to the issue around micro-generated power and the existing electrical grids.
  • Penalties for the use of non-renewable energies may need to be implemented to help stir and develop demand for micro-generation technologies.
  • Governments need to stimulate the market by leading the way using micro-generation for all government buildings and property. Permitting for future planned neighborhoods should be done with a target of including a specific level of micro-generated power to the development.
  • People must receive better information and education about micro-generation, its benefits and how it can be made affordable. Countries need to develop standards for renewable energy technologies and certify products to the same standard to increase trust by consumers.

Several countries including Germany, the UK, Sweden, and Australia have worked hard to implement policies that support microgeneration technologies and they are continuing to bring greater financial support through things like feed-in tariffs and other incentives to build demand.

We can learn from their research and from their successes and failures in moving towards micro-generation. Once thing is certain; the efforts will continue to increase and intensify because climate change is real, the problem of fossil fuel availability is real and the inability to provide enough energy worldwide with increasing electronic demands are real despite some slowdown in population growth. There is only one way to solve these problems and that is through the wide spread adoption of renewable energy generation.

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