Traditional power systems are built around relatively few, centralised power plants: large-scale generators such as coal, gas or nuclear plants connected into the high-voltage transmission part of the T&D network (the centre of the grid).
Distributed generation refers to the existence of more numerous, smaller-scale power generators cited at or close to end-users (in the distribution part of the T&D network, i.e. the grid edge). So this could include examples like rooftop solar PV, small-scale or community wind turbines, micro hydro schemes, or captive power facilities at industrial or commercial facilities.
There are many potentially disruptive aspects of distributed generation to traditional power businesses, both economic and technical. Here are just a few:
- The reversal of power flows within distribution networks (i.e. into the grid, rather than out).
- A reduction in total power flows across the grid and in centralised electricity sales, if more electricity is used in the same place as it’s generated.
- Opportunities for new charging and billing models, such as net-metering, grid charging and so on.
- Opportunities for new “power producers” such as rooftop leasing companies, community schemes and so on.
- Increased separation or integration of alternative grid concepts such as microgrids (or fully off-grid)
- The integration of distributed generation with a variety of other “smart”, locally connected devices including battery storage, EVs, smart devices and more.