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Slide 2: Pre-Requisites
In order to fully appreciate this topic, you need to understand how energy is billed. Factors such as demand, demand
ratchet and time of use all have an impact on the potential returns from your distributed generation strategy. If you do
not have a thorough knowledge of these topics, please take Energy Rate Structures I and II first.
Slide 3: Welcome
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Click the attachments link to download supplemental information for this course. Click the Notes tab to read a transcript
of the narration.
Slide 4: Objectives
At the completion of this course, you will be able to:
• Identify important drivers for why distributed generation is gaining popularity as a source of energy
• Describe the primary categories of technology used to generate small-scale electricity; and you will be able to
• Discuss the main benefits and issues for each technology
Slide 5: Introduction
Most industrial economies rely on very large central station power plants for electricity production. Such plants are
fueled with natural gas, oil, coal, nuclear, and hydropower. Large central station power plants benefit from economies
of scale to deliver high production efficiencies and/or at low production costs. However, they are usually located in
remote areas and need to transmit electricity over long distances to end users located throughout a region.
Transporting electricity over long distances over transmission wires results in lost energy.
Slide 6: Introduction
Distributed generation reduces energy losses by bringing energy production closer to the end user, sometimes even in
the same physical building or campus. Distributed generation reduces the number and size of transmission and
distribution wiring needed to serve modern-day energy needs.
Slide 7: Introduction
Capacity margin is the amount of unused available capability of an electric power system at peak load as a percentage
of capacity resources. Due to significant growth, capacity margins are declining to alarming values. In many countries,
the quality of electric power is poor in terms of frequent power interruptions, un-scheduled power reductions, voltage
variations, frequency fluctuations, presence of harmonics, and other system instabilities.
Slide 8: Introduction
In almost all cases, the price of electricity is steadily increasing. The cost of fuel is pushed up by increasing global
demand, and the cost of production is impacted by requirements to meet more stringent emissions regulations.
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Many times, there are very few options that an end user can choose from for alternate sources of energy. They are
captive to the existing electric grid.
Slide 9: Introduction
Recent electricity market deregulation, greater emphasis on environmental quality, and on-going concerns related to
the high cost of electricity is resulting in a renewed interest for distributed generation throughout the world. Distributed
generation provides an alternative to, or an enhancement of the traditional electric power system. The purpose of this
course is to discuss various small-scale generation technologies that exist today. We will then move on with a
discussion of the major benefits and issues of distributed generation. Let’s begin with a discussion on the definition of
distributed generation.
Renewables such as solar energy, wind power, and in some cases geothermal offer potential for energy production
near populated areas as well. Battery storage and automotive application of electric vehicles are also being developed.
These technologies can be used as electric energy sources on-demand when plugged into the grid. Distributed energy
resources are any of these technologies introduced and include small-scale power generation technologies (typically in
the range of 3 kW to 10,000 kW) used to provide an alternative to or an enhancement of the traditional electric power
system.
Slide 12: Major Drivers for Why Distributed Generation is Gaining Popularity
Deregulation of electric markets and environmental concerns can be cited as the two main drivers for why distributed
generation has gained popularity in recent years. Let’s look at the deregulation of electric markets as the first driver.
Slide 13: Major Drivers for Why Distributed Generation is Gaining Popularity
We’re seeing an increased interest by electricity suppliers in distributed generation because they see it as a tool that
will help them to fill in niches in a deregulated market. In deregulated markets, customers look for the electricity service
best suited for them. Naturally, different customers will attach different weights to features of the electricity supply.
Distributed generation technologies can help electricity suppliers deliver the type of electricity service their customer
prefers. Distributed generation allows competitors in the electricity sector to respond in a flexible way to changing
market conditions.
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Slide 14: Major Drivers for Why Distributed Generation is Gaining Popularity
In deregulated markets, it is important to adapt to the changing economic environment in the most flexible way.
Distributed generation technologies generally provide this flexibility because of their small size and the short
construction lead times compared to larger central power plants.
It should be noted that the lead time reduction is not always realized due to difficulty obtaining permits as well as other
factors, and a fair amount of public resistance may still exist with regards to very large wind energy generators.
Slide 15: Major Drivers for Why Distributed Generation is Gaining Popularity
As distributed generation becomes more prevalent throughout the world, we can expect to see increased interest in
peak use capacity (peak shaving) and other demand response opportunities. There will be significant technical
emphasis in areas related to standby capacity, reliability, and power quality.
There are also opportunities and concerns related to alternative expansion of use of the local grid network, and
increased demand for grid support.
Slide 16: Major Drivers for Why Distributed Generation is Gaining Popularity
Environmental policies and concerns are also a growing driving force behind demand for distributed generation.
Environmental regulations force participants in the electricity market to look for cleaner energy, and in turn, more
cost-efficient solutions. Distributed generation can play a role here, as it allows for optimizing energy consumption of
firms that have significant requirements for both electricity and heat. Now let’s move on and discuss engine types.
Reciprocating engines were developed more than 100 years ago. These were among the first examples of distributed
generation technologies. Both the spark ignition and the diesel cycle (also called “compression ignition”) engines have
gained widespread acceptance in almost every sector of the economy. They are used on many scales, with
applications ranging from fractional horsepower units that power small tools to enormous 60 MW base load electric
power plants.
Smaller engines are primarily designed for transportation and can usually be converted to power generation with little
modification. Larger engines are more frequently designed for power generation, mechanical drive, or marine
propulsion.
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• Intake (Induction)
• Compression
• Combustion (Ignition), and
• Exhaust
The fuel/air mixture is introduced into the engine cylinder, compressed and ignited with a spark.
For diesel units, the air and fuel are introduced separately with fuel being injected after the air is compressed – ignition
is accomplished through heat-of-compression.
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Reciprocating engines are currently available from many manufacturers in many size ranges. They are typically used
for either continuous power or backup emergency power. Cogeneration configurations are available with heat recovery
engine cooling, and from hot engine exhaust gas. A significant amount of energy from an engine generator is available
for low-temperature heating processes which are shown in the pie chart as heat rejected losses.
With the arrival of modern, high efficiency turbochargers, it is possible to use an exhaust gas driven turbine generator to
further increase the engine’s rated output. The net result is lower fuel consumption per kWh and an increase in overall
thermal efficiency.
A number of companies are currently field-testing demonstration units, and several commercial units are available for
purchase. A simple internet search will yield the name of companies in your area.
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power. Most microturbine units are designed for continuous-duty operation and many are recuperated to reduce fuel
consumption. A recuperated unit is fitted with a heat exchanger to recover some of the heat from the exhaust. This is
used to pre-heat the incoming air, boosting the fuel efficiency, but leaving less heat available for recovery for other
uses.
Combustion turbines range in size from simple cycle units starting at about 1 MW to several hundred MW when
configured as a combined cycle power plant. Units from 1-15 MW are generally referred to as industrial turbines or
sometimes as miniturbines. This differentiates them both from larger utility grade turbines and smaller microturbines.
Industrial turbines are currently available from numerous manufacturers. Historically, they were developed as aero
derivatives - spawned from engines used for aircraft propulsion.
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For years, steam turbines have been used as prime movers for industrial cogeneration systems. High-pressure steam
raised in a conventional boiler is expanded within the turbine to produce mechanical energy, which may then be used to
drive an electric generator.
The power produced depends on how much the steam pressure can be reduced through the turbine before being
required to meet the site heat energy needs.
A steam turbine will generate less electrical energy per unit of fuel than a gas turbine or reciprocating engine-driven
cogeneration system, although its overall efficiency may be up to 84% higher - because it is generating both heat and
electricity (based on fuel gross calorific value).
The higher the turbine inlet pressure, the greater the power output. Higher steam pressures entails progressively
greater boiler capital and running costs.
Optimum pressure will depend on the size of the plant along with the required process steam pressures.
Steam cycles have an immense advantage in that the associated boiler plant can be designed to operate on virtually
any fuel, including:
• Coal
• Gas
• Heavy fuel oil (HFO)
• Residues and municipal or other wastes, and are
• Often capable of operating on more than just one fuel.
An existing site supplied by low pressure boilers will normally need to replace the existing boilers with high-pressure
equipment. It may be desired to retain the original equipment as stand-by.
Steam cycles normally consume a large amount of energy compared with the electrical output. Steam turbine plants
also have high equipment and installation costs.
However, incineration typically raises concerns over the production of undesirable emissions.
As an alternative, some types of waste can be gasified and the resultant gas used to fuel a gas turbine installation—or
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possibly even a gas engine.
The simplest arrangement is the back-pressure turbine in which all the steam flows through the machine and is
exhausted from the turbine at a single, relatively low pressure—suitable for use on-site.
Using the exhausted steam for process or other heating makes a contribution to the overall efficiency of the site.
However, if this exhaust is not used, the energy contained within it is wasted. In a moment, we'll see how the second
type of turbine handles this.
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The site heat load requirements dictate the amount of steam produced. The steam passes through the turbine and
contributes to power generation, and then exits the turbine to satisfy the heating requirements.
Hence the power output is dependent on site heat load. When more heat is required by the site, more steam is
produced, and more power is produced as well.
Where more than one grade of heat is required, the higher grade is served by extraction steam at the appropriate
pressure part-way along the turbine. Taking steam out of the turbine means there is less energy available for making
electricity, but if the extracted steam can be used for useful process heat that can lead to higher overall cycle efficiency.
This means the turbine gets as much energy as possible out of the steam. The surface condenser captures the water
that condenses out of the steam and returns it to the boiler. Some energy does escape from the turbine and passes
through the condenser during the process of condensation. However this is generally not recoverable, and is usually
rejected to the environment—as heat or water—and is lost.
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Slide 34: Steam Turbines
Let's look at an application. District heat is a system for distributing heat generated in a centralized location to a group
of residences and/or commercial buildings to provide heating requirements such as space heating and water heating.
Instead of each house or business having their own boiler, there is one central heating system which they all use.
In district heat designs that include cogeneration, the system deals with production of power as well as heat. The
steam turbine is used to produce power, but is set up with the turbine condenser operating near or even above
atmospheric pressure. In effect, this is deliberately running the turbine to produce less power, so that the steam which
leaves the turbine and enters the condenser still contains considerable energy. This guarantees that the condenser
cooling water picks up enough heat to supply the district heating circuit.
Wind turbines are packaged systems that include the rotor, generator, turbine blades, and drive or coupling device.
As wind blows through the blades, the air exerts aerodynamic forces that cause the blades to turn the rotor. As the
rotor turns, its speed is altered to match the operating speed of the generator. Windmill graphic is courtesy of the U.S.
Department of Energy.
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electricity can be used locally, or on the electric grid.
Advances are also being made into vertical-axis wind turbines, which are seen as an alternate to traditional propeller
designs.
PV cells produce direct-current (DC) electricity, which must then be inverted for use in an AC system. Today, PV units
have efficiencies of 24% in the lab and 10% in actual use, which is far below the 30% maximum theoretical efficiency
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that can be attained by a PV cell.
The first systems demonstrated were 200-kW phosphoric acid units from International Fuel Cells (International Fuel
Cells - also known as ONSI, UTC Fuel Cells). A number of companies are close to commercializing proton exchange
membrane fuel cells, with marketplace introductions expected soon.
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• A fuel cell consists of two electrodes separated by an electrolyte
• Hydrogen fuel is fed into the anode of the fuel cell
• Oxygen (or air) enters the fuel cell through the cathode
• With the aid of a catalyst, the hydrogen atom splits into a proton (H+) and an electron
• The proton passes through the electrolyte to the cathode and then the electrons travel in an external circuit
• As the electrons flow through an external circuit, connected as a load, they create a DC current
• At the cathode, protons combine with hydrogen and oxygen, producing water and heat
• Fuel cells have very low levels of nitric oxide and carbon dioxide emissions because the power conversion is
an electrochemical process
• The part of a fuel cell that contains the electrodes and electrolytic material is called the "stack," and is a major
contributor to the total cost of the system
• Stack replacement is very costly but becomes necessary when efficiency degrades over time
The Stirling engine has been around for over 60 years. This engine is an external combustion device and as a result,
differs substantially from the conventional combustion plant where the fuel burns inside the machine. Heat is supplied
to the Stirling engine by an external source, such as a burning gas, waste heat, or solar energy. This makes a working
fluid - for example - helium, expand and causes one of the two pistons to move inside a cylinder. This is known as “the
working piston”.
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(Diagram courtesy of www.stirlingengines.com)
The external burner or heat source allows for a very clean exhaust and gives the possibility of controlling the electrical
output of the engine by reducing the temperature of the hot side. So there is the possibility of varying the electrical
production regardless of the need for thermal heat demand.
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Slide 55: Advantages and Disadvantages
As we discussed, each technology has advantages and disadvantages. It’s important to weigh these advantages and
disadvantages prior to selecting a distributed generation technology. To assist you with weighing these issues, we’ve
attached a downloadable table that lists out the basic advantages and disadvantages of each technology. We’ve also
included some additional resource information that addresses the topic of distributed generation in more depth.
Lastly, we discussed the major benefits and issues for each of these technologies.
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Slide 58: Thank You!
Thank you for participating in this course.
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