Prospects for distributed renewable electricity generation in competition-based power markets

摘要

In the face of liberalisation many electricity markets are currently being substantially reshaped. One feature of this change is a gradual shift from centralised to more localised systems for electricity production situated closer to the consumer. Distributed generation (DG) sometimes offers an attractive alternative to large-scale centralised capacity expansion, mainly due to lower initial investment costs and greater flexibility that allows a better match of supply capacities with actual demand. Moreover, there is plenty of scope for using renewable and environmentally less damaging energy sources, an important ingredient in any strategy to curb local pollutant and global greenhouse gas emissions. uncertainties introduced by the liberalisation of the energy markets, however, and a lack of suitability of traditional approaches to assess the economic performance of DG technologies, often make comparisons between different generation options a challenge. This paper addresses the potential of DG in competitive power markets on a conceptual level. We conclude that the combination of competition and new modular generation technologies will dramatically transform the energy supply business, and that DG can be expected to contribute significantly to achievement of environmental, regulatory and developmental challenges.