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14 MICROPOWER: THE NEXT ELECTRICAL ERA COMING FULL CIRCUIT 15 lines that Edison had envisaged, with individual businesses generating electricity themselves in decentralized fashion.”24 Instead, for four decades, technological and institution- al developments reinforced the trend toward large power sys- tems, which in turn created remarkable declines in consumer prices. Improvements in the efficiency of steam turbines steadily pushed up the scale of the generation units, whose largest size jumped from 80 megawatts in 1920 to 600 in 1960 and from 600 megawatts in 1960 to 1,400 in 1980. But then, unit scale “hit the wall” of efficiency limits, environ- mental concerns, energy crises, overcapacity, and multi-bil- lion dollar losses from nuclear power plants, all of which indicated that the bigger-is-better approach entailed certain “diseconomies of scale.”25 Meanwhile, new policies and technologies were in the process of reversing the decades-long trend toward large- scale power systems, allowing the development of inven- tions that challenged the natural monopoly of utilities. In the United States, the energy crisis of 1973 had laid the groundwork for legislation that allowed independent power producers access to the electrical grid. By removing barriers to entering the power-generating market, the laws catalyzed major innovations in small-scale technologies.26 In his new book, Power Loss, Hirsh writes that these rules “proved that large-scale hardware no longer held a stranglehold on low-cost electricity.” New types of equip- ment were brought on line, tapping resources that had for decades been wasted or overlooked. Thousands of wind tur- bines, averaging between 50 and 300 kilowatts in size, were installed in the state of California. Between 1980 and 1990, U.S. industry’s use of waste heat from electricity generation for heating and additional power, known as “cogeneration,” nearly quadrupled. Particularly popular were new combined- cycle gas-combustion turbines derived from aircraft jet engines, which were suitable for mass production and ranged in scale from 10 to 90 megawatts. Their use grew dynamically as natural gas prices dropped. The turbines were economical at sizes of 100 megawatts or less and required much lower initial investment than 1,000-megawatt coal or nuclear power units did.27 By demonstrating smaller and cheaper ways to provide electricity, these new technologies, offered by independent producers, began to undermine the justification for monop- oly utility control over power generation. During the mid- 1980s, support grew for eliminating monopoly regulation and bringing market principles back into the power sector, or restructuring. In the United Kingdom, deregulating the coal industry and opening utilities to competition led to a dra- matic increase in the use of combined-cycle gas turbines, whose heightened commercial attractiveness spurred interest in power sector restructuring elsewhere.28 Large electricity consumers were particularly intrigued by the shift. Pointing to the cost declines resulting from the restructuring of the airlines and telecommunications indus- tries, they pressed for analogous changes in the power gen- eration sector. Similar changes unfolded in some European nations, Latin America, and the United States. The tide of electricity restructuring was washing up on more and more shores, gradually converting a once staid industry into a free- wheeling, dynamic business.29 The gas and wind turbines and cogeneration systems of the 1980s were bellwethers of a trend that would accelerate throughout the 1990s. The average size of a new generating unit in the United States declined from 200 megawatts in the mid-1980s to 100 megawatts in 1992 and to 21 megawatts in 1998, roughly equal to the electrical sizes of the World War I era. Still smaller sizes, down to 10 and even below 5 megawatts—the average size in 1903—were also beginning to emerge. (See Table 1.)30 From the perspective of power generation, the last decade of the twentieth century may have had more in com- mon with its first decade than with the 80 years in between. Discovering that they could provide power from cogenera- tion, wind, and gas systems, independent power producers— as well as some utilities—were revitalizing the concept of generating power at a smaller scale and nearer its ultimatePDF Image | Micropower: The Next Electrical Era
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