Lesson 11: A Niche Created from Decentralized Power Generation – Rob Fulton

I think one of the greatest advantages of decentralizing power generation, is that it will improve efficiency of power generation. By reducing centralized power generation, overproduction of energy will reduce. To explain, transmission losses can be avoided by having sources of power located more closely to end users. It is generally understood that between 5% and 10% of grid losses are due to transmission losses, because of the long distance between generation sites and consumers (WADE, 2014).

Businesses both providing and supporting distributed power have the greatest potential for benefiting from increased decentralization of power generation (Owens, 2014). The outlook for Solar PV is especially bright. There seems to be a niche opening for institutions, businesses, and even residential property owners for installing solar arrays on their roofs and properties to not only reduce their energy cost over the long run, but also to produce revenue from selling power to the grid. Such ventures are even better with governmental incentives still making them economically feasible.

With the ever-increasing number of Solar PV companies launching in my home state (California), consumers need a source of information that will provide data such as approval ratings, cost comparisons, customer feedback, etc. on the list of companies serving their locations. Providing such as service would fill that void and with good marketing and advertising I believe the service would be desired and purchased. It could be as simple as paying a fee to enable access to information via the web, with more premium access, at a higher fee, which could include phone or office visit consultation services.


Works Cited:

Owens, B. 2014. “The Rise of Distributed Power.” THE RISE OF DISTRIBUTED POWER. http://www.eenews.net/assets/2014/02/25/document_gw_02.pdf.

WADE. 2014. “How Does DE Work?.” WADE : World Alliance for Decentralized Energy. World Alliance for Decentralized Energy. http://www.localpower.org/deb_how.html.

Business Opportunities Through Decentralization- Mark Moore

What will be the effect of greater decentralization of power generation?

The decentralization of power generation is an important step in attaining energy efficiency and meeting future demands. First, it is important to consider the drawbacks of a centralized system. Centralized power is a wide network of transmission lines which supply residences, industries, and almost every structure demanding power. This system is very inefficient because of the distance the energy must travel and from the loss of energy through conversion. The biggest problem; however, is the systems vulnerability to natural hazards. When one section of the distribution system is cut off due to a natural hazard, the whole system suffers.

Greater decentralization will provide a more flexible system where distributive capacity could be added through the development of a smart grid. This allows consumers to generate their own power and supply the grid with any excess power not used. The formation of ‘micro grids’ will create a more efficient, reliable system that can form a symbiotic relationship with the main grid. In the event of natural disaster, a micro grid can disconnect from the main grid and still generate it’s own power. The market implications are enormous through decentralization of power generation. Of course, the decentralization depends on government policy and the massive amounts of money spent on lobbying politicians.


What new businesses will evolve in this changing landscape?

There will be many business opportunities in the energy industry created by decentralization. The renewable energy sector alone will have major growth potential in solar, wind, geothermal, biomass, and other forms. Within these renewable energy generation sectors there will be need for installers, maintenance workers, and designers. Battery storage is a business opportunity that will continue to expand as technology increases the storage capacity. Computer software and sensors will play a large part in the development of the micro grid, which will create opportunities for entrepreneurs to cash in on their innovations. Consulting firms will be needed to help direct entrepreneurs and forecast certain niche markets made available in the changing energy industry. Finally, capital will be needed to finance these business opportunities and investors who can foresee the potential, while understanding the government incentives, stand to make substantial returns.


What business can you see yourself creating to serve this market?

I could see myself starting a consulting firm. I am not a computer programmer and do not possess the engineering skills to create something innovative. I am more interested in finance and policy, and would help entrepreneurs navigate through the government incentives and regulations, while providing them with a financial analysis of project plans. My consulting firm will help align business strategy and compliance initiatives while also providing risk assessment and governance goals. The consulting aspect in this industry could provide a business the tools needed to capture it’s full market potential.