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6 MICROPOWER: THE NEXT ELECTRICAL ERA INTRODUCTION 7 investment capital that were unthinkable only a few months ago. Now, as then, the arrival of financial entrepreneurs on the scene marks an important step in the evolution of a new electric power system.3 Edison would be excited for another reason as well. Relatively small-scale, localized power was what he had in mind when first installing his electric power-and-lighting systems in the late nineteenth century. Edison envisioned a dynamic, decentralized electricity industry, with dozens of companies generating and delivering power close to where it was to be used, or even putting systems on site in customers’ basements. And at first, electric power systems did indeed evolve along these lines, with hundreds of small “central-sta- tion” and isolated plants appearing in cities across the Western world. Small-scale power units were particularly popular in factories, which could save money by capturing and reusing their waste heat.4 But new technological and institutional developments soon began to point in a different direction. The rise of the steam turbine and the development of alternating current were making it economical to generate larger amounts of electricity and to transmit it over longer distances. The par- allel spread of the idea of the power business as a natural monopoly reinforced this trend, as electric utilities embraced the large-scale model, with its “economies of scale,” as the best means to generate low-cost power for consumers. Five decades later, however, in the 1980s, the steady trend of big- ger plants and plummeting prices came to a sudden end as the industry encountered limits to efficiency gains, environ- mental problems, rising energy prices, and costly nuclear power projects. By the 1990s the trend had actually reversed, with gas and wind turbines auguring a dramatically different paradigm for energy supply.5 As we embark upon the second electrical century, a “triple power shock” of technological, economic, and envi- ronmental trends could potentially push the energy system further toward a more small-scale decentralized model. Some see parallels with recent revolutions in the telecommunica- tions industry, which has been transformed by new technol- ogy and deregulation, and in the computer industry, which has been completely realigned by the rapid shift from main- frames to personal computers. In any event, these new “micropower” technologies represent a dramatic departure from the status quo.6 The solar cells, microturbines, fuel cells, and other devices now beginning to trickle into the commercial power market have capacities as low as 1 kilowatt, one millionth the amount of power generated by a typical nuclear plant. With three quarters of U.S. commercial and residential cus- tomers using on average no more than 10 and 1.5 kilowatts, respectively, the new generation of technologies is well matched to the scale of need. During the coming decade, continued technical advances will likely accelerate the downsizing. Small and modular, the new technologies’ advantage stems not from economies of scale—building big- ger units to lower costs—but from economies of produc- tion—producing more units to lower costs.7 A related factor in micropower’s rise is the shift in the philosophy of power generation—away from the natural monopoly of utilities, and toward open, competitive mar- kets—that is sweeping the globe and revolutionizing an $850 billion industry. As the costs of ever-larger power supply, or “diseconomies of scale,” come under greater scrutiny, it appears that, to paraphrase E.F. Schumacher, small may be beneficial. In addition to becoming economical when mass- produced, modular systems can be adjusted to match the scale of demand and installed far more quickly than a cen- tral station. Micropower can improve reliability by reducing demands on transmission systems and thus avoid costly investment in new power plants. And smaller systems can facilitate more local control over power use, contributing to economic development within the community and reducing reliance on distant institutions.8 Some of the most important benefits may be environ- mental, as modern micropower systems will generally leave a lighter ecological footprint than the predominantly fossilPDF Image | Micropower: The Next Electrical Era
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