Independent energy

Since the early beginnings of electrical generation, economies of  scale have had a very relevant role in the reduction in costs of the generated energy. Until some years ago, colossal fossil fuel, nuclear, and hydro-electric plants were the only investments that were being made in electrical generation. They required sums of hundreds of million euros to become operational. This restricted the range of potential investors to just few large companies that were able to finance and operate these generation assets.

The advancement of technologies to generate electricity from renewable sources such as wind or solar, has opened the door to new adversaries in the shape of small independent producers of electricity. The evolution of renewable technologies has made the construction of smaller installations feasible and attracted a much wider range of investors thanks to a lower capital expenditure per project. In the following link, the evolution of the costs of these technologies in recent years is shown: IRENA. The advent of distributed generation is now here. Now, huge investments are not necessary in order to generate energy at a competitive rate. That is why we think the energy of the future will be independent, because it will increasingly be developed, in a market with a growing number of participants and with stiffer competition.

How would distributed generation be deployed in the future? In the near-future it will continue to be installed as a generation source linked to the existing electrical system, both on domestic and industrial scales. Later, other elements such as batteries will become increasingly installed alongside generation units, so users would increase their management capacity and improve the services offered to operators of the wider electrical system.  As a greater number of these units are constructed over time, small grids would become established ‒known as microgrids‒ and they would allow the integration of renewable energy sources with other energy storage technologies; so, users will reduce and even finish their dependence on the main electrical grid.

A time of changes is coming in the world of electricity generation, and the balance of power will be very different. Energy 4.0 is coming.