Even though distributed renewables get the majority of DG headlines, solar and wind are not the only customer-sited generation options.

Today, 8 percent of all U.S. electric generation capacity comes from customer-sited CHP and fuel cells. This is almost double that of the total U.S. wind capacity, and 10 times that of distributed solar. And it’s been around for decades. The sheer scale achieved by CHP systems — 83GW in the US — was a big reality check as we worked on this assignment with Greentech Media.

CHP systems can typically achieve 75-90% efficiency (compared to ~45% from centralized generation) when they are properly sized and located near the site where customers can use the power and heat. We believe that fuel-based DG will continue to play a significant role in the U.S. electricity system, as the U.S. grid infrastructure ages and the need for cleaner and affordable generation options increases. In fact, our analysis showed that we may be close to a tipping point for this market to start growing again — but among new customer segments and applications — which is a pretty exciting prospect.

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