L11 – Mulhollem – Decentralization – stock market


This is our last blog so I wanted to mix it up a little. I just wanted to get everyone thinking about what makes the electricity market in the United States different from other countries.

When we look at decentralization of our electrical power, we must take into consideration that the electrical utility companies are for the most part publicly owned and traded on the stock market. These stocks pay very good dividends. Some utility stocks pay 5 – 6 % dividends per year. There are a lot of these stocks in American saving portfolios such as 401K and IRAs funds. If decentralization was to take place on a larger scale it would cut into the dividends utility companies pay to their stockholders. This would affect the stock market along with the savings plans. The federal regulatory agencies realize this so I will be surprised if a decentralization of more than 20% ever takes place. With that said, I do see small scale, behind the meter projects to be the only real growth that could take place.

With the recent advances in battery technology and improvements in appliance efficiency, I would suggest that off grid home electricity will become the next energy entrepreneurial market. If we are able to reduce our residential electrical consumption to 1/4 of what we use now through efficiency, then battery storage could be a viable source of electricity. To take this further, we could re-engineer our homes to use DC current instead of AC current. There is approximately a 30% loss of efficiency in the conversion from AC to DC. All of our computers, TVs, LED lighting and appliances actually run on DC current. AC from your electrical outlet is converted to DC inside the TV through a bridge rectifier. This consumes a lot of power. If future battery storage would be able to run a house overnight, a photovoltaic array could recharge it during the day. Photovoltaic arrays produce DC current so there would be a minimal loss when charging the batteries.

The area that I feel would see a very large growth in the future is the battery storage and battering charging. Batteries need to be charged and cycled properly. I could start a business that would monitor and cycle the batteries as needed. This would be done remotely through a wireless connection. The temperature of the batteries is also critical to the output and life of the batteries. This business would complement the installation of any small scale, behind the meter electrical projects. The batteries will also need to be monitored 24 hours a day. After the installation, my business would charge a small fee for the monitoring and reporting of information pertaining to the batteries. The company could also send a daily usage report to the owner so they would know what level the batteries are at any time. The business would also develop a phone application to receive battery information at any time.

6 thoughts on “L11 – Mulhollem – Decentralization – stock market

  1. Hey Mark,

    Great post and unique points. I just got around to reading the other blogs, and realized you discussed effects of decentralization in investment and retirement banking funds, a point I discussed as well. The loss of major funds will require niche specialization in energy investments, in order to provide financial planning companies with information on smaller, and more volatile, industries and working groups. Unfortunately, the loss of stable funds might not be replaceable in current markets, but there is potential based on future renewable fund developments (or, there is always Disney stock).

    Nice to see a similar point made.


    (You can find my post at http://engr312.dutton.psu.edu/2014/11/07/decentralized-power-generation-stama/)

  2. Great post! I am really glad you mixed it up, I think the idea is something you should truly consider looking into. When I read your post I was thinking of how the business could be setup — as far as the monitoring and retrieval of information goes it reminds me of a security system. Maybe look into how they manage and the software and technology they may use to monitor and communicate with the equipment. As for the batteries would you have some sort of backup in case the battery dies prematurely? I’m really interested in how much energy could be saved in less conversion from DC to AC. Thanks for sharing!

  3. I like the idea of monitoring batteries. I think that it would be hard to get customers though, because why wouldn’t the contractor who installed the system monitor the batteries? All of our solar systems that we install, we monitor for 5 years,we could do the same for batteries. Are you actually going to send out people to add electrolyte or whatever? Anyways, I enjoyed reading your post, I’m not actually expecting a response, I’m just responding to your post for obvious reasons. Its been great working with you in this class Mark.
    J. Bond

  4. Wow, what an informative and interesting post, thank you for the enlightenment. I was not aware how centralized the stock market was to the utility companies. The information you state could be key player to why it has not evolved as big as places such as Germany (among other reasons). I just love your business idea and the real time monitoring is a brilliant theory for the sake of the user. Would you consider forming this business as a lean start-up or traditional style? Personally, I believe a lean approach could favor your idea by testing and adapting changes as needed! I believe we can expect major technical changes to batteries and storage infrastructure with growing deregulation to meet peak load requirements. Thank you for sharing your ideas and mixing up the format!
    Katie Loyd

  5. I get what your saying and I agree. However, after reading some of the articles, there is no escaping decentralized power. I mean in many ways it is already happening. everyone who installs an array is devaluing stock by reducing revenue. this is way simplistic but the premise is true. Out here in California, utilities have been avoiding this reality. Their solution so far has been to raise rates. Similar to college tuition, all this does is create more animosity and promotion of other power methods. However, to avoid some of the sting electricity from micro grids can be sold back to utilities and real trade can exist. A business partnership is born. this also does away with the battery back up situation which may never reach a large audience.


    • Hi David,
      The utility companies have already raised our rates in NJ to reflect all the added PV arrays. Once everyone realizes that we are going up against the stock market, a different approach will be needed. I can tell you that they will make their forecasted dividends. They have also basically shut down the PV industry in Pa. Why? It is not because PVs don’t produce; it is because the utility companies saw it as lost revenue. You have to follow the money trail.
      As for battery storage, what if I told you I could run a house off 2 car batteries? (TV, computers, lighting, washing machines and even an air conditioning unit). Would you want to know more?

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