Photo: Distributed generation makes use of renewable energies and helps reduce emissions. Credit: Unsplash

By Alba Casilda

Energy generation and distribution has primarily relied on large power plants. Now, a new model is being promoted that aims to build cleaner environments where end users have the ability to generate, consume and share energy. To do so, they simply install solar panels on the roof of their own home and set up a community where some people produce their own renewable energy, while others are able to connect to the roof to enjoy it. This method of producing and self-consuming energy is part of the new distributed generation energy model that is being developed on a national and international level.

According to La guía básica de la generación distribuida, produced by the Fundación de la Energía de la Comunidad de Madrid, there are several definitions used to explain the distributed generation trend. On the one hand, it refers to the Distribution Power Coalition of America (DPCA), which explains that it is considered “any small-scale generation technology that provides electricity to locations closer to the consumer than centralized generation and that can be connected directly to consumers or to the transmission or distribution network”. On the other hand, it also mentions the approach of the International Energy Agency (IEA), which refers only to technology that “connects to the low-voltage distribution grid and links it to technologies such as engines, mini- and micro-turbines, fuel cells and solar photovoltaic energy”.

In short, distributed generation involves taking advantage of new technologies so that the end consumer can consume and share the energy they produce. In this way, the production would be close to the point of consumption and would be produced from smaller sources, as opposed to what happens in the traditional system where production is centralized from large sources. According to the Community of Madrid document, the idea is to build a model in which both systems can complement each other.

Towards an international clean energy model

The creation of this new generation and consumption system has an international scope. In fact, in the Clean Energy Package, the European Union (EU) has established the legislative framework to promote energy efficiency and the use of renewable energies. These legal aspects must be taken into account by the electricity companies in order to achieve the energy targets set out for 2030. Among other things, it encourages promoting self-consumption and establishes the consumers' right to generate, store, use and share renewable energy.

One of the ways to encourage self-consumption is by promoting distributed generation. As explained by Endesa, this requires implementing microgeneration strategies, which involve the use of renewable energies and, therefore, reduce CO2 emissions. For example, wind turbines could be installed near lights so that streetlights are self-powered; electric vehicles could be used to feed energy into the grid; and photovoltaic panels could be installed on the roof of a building, so that it could be electrically self-sufficient and provide surplus electricity to other nearby parts of the city.

Although it's true that solar panels could already have been installed many years ago, ” there is now starting to be a change in both consumer and company mentality,” says Amelia Hernández, innovation strategist and communications manager at Opinno. She also adds that “there is a public concern for greener alternative solutions. In addition, as people spend more time at home, they attach greater importance to energy consumption.

Living is sharing

Distributed generation has led to the creation of community-based resource sharing. One example is Solmatch, launched by Repsol. It is a solution used to design solar communities and generate local and renewable electricity in urban environments.

Members of such communities can play two roles. On the one hand, there are roofers. This role can be taken on by schools, neighbours, public entities, private homes, gyms and businesses. They make use of unused roof space by installing solar panels. In this way, they have priority access to the energy they produce, as well as being able to share it.  On the other hand, there are the matchers, i.e., households that connect to a solar community within a maximum of 500 metres to benefit from the energy produced by the roofers.

Photo: Individuals can install solar panels on the roof of their house to generate and share their own energy with their neighbours. Credit: Pexels

A different approach is that proposed by the EnergÉtica cooperative, which offers a range of different installation options. For example, one of its solutions is aimed at residential communities to enable them to generate their own energy and supply common services. However, this type of action is not only for private individuals. For instance, the organisation also targets municipalities that wish to install solar panels on some of their buildings and thus use the production to cover the needs of families at risk of exclusion.

Iberdrola is also another company that has embraced collective self-consumption through the creation of solar communities. To do so, it has created its Smart Solar programme. It works in a similar way to the previous examples and allows different environments to generate their own 100% renewable energy and distribute it among their neighbours.

This type of initiative encourages the development of smart cities, intelligent cities that integrate technology to improve the way they function. According to Hernández, smart cities have so far focused more on mobility issues and she adds that “new formulas are now being proposed to bring this intelligence to household energy consumption”.

The benefits and challenges of a cleaner and more local environment

Through examples such as solar communities, distributed generation has a positive impact on the environment and both companies and individuals can take advantage of this new model:

  • Cleaner systems. Energy generation is achieved in a more environmentally friendly way, as it is obtained from renewable energies which, in turn, are the most suitable for being located near points of consumption.
  • Financial savings. Through self-consumption, individuals can better manage their costs.
  • Efficiency of production. As it is distributed in a local environment, the energy generated is utilised at nearby locations and is not lost during transport, as it does not have to travel long distances through the electricity grid.
  • Reduces the risk if any one power source fails. By having several power generation points in the city, the grid will not be affected as much if one of them has a problem.

“Since COVID-19, people are building a more local way of life. Through this type of system, companies will be able to get closer to citizens, meet their new needs and consider how they can leverage resources to support new consumer habits,” says Hernández.

At the same time, she points out that while the energy landscape is moving towards distributed generation, companies will have to overcome a number of hurdles along the way. “Firstly, they have to be more open-minded and secondly, they have to navigate a highly regulated environment. It is not a question of stopping the exploitation of energy from traditional sources. That would imply a huge geopolitical and economic change. It is a process in which these new formulas coexist with the current ones,” she adds.

It is clear that society has an obligation to create cleaner environments. Distributed generation, through initiatives such as solar communities, is an important part of the way forward to more efficient and environmentally friendly systems. It will be a process in which consumers and businesses will grow closer than ever before.