Decentralized is the new black

The global shift to cleaner energy sources is not new. Renewables have been growing since 2010 around 10% per year according to IRENA [1]. The adoption of new technologies has brought a revolution within the energy systems. 

Energy grids are not going only in one direction as they first were when created, but they are now being upgraded to be able to match bi-directional energy supply to energy demand [2]. This new approach is a factor that facilitates a system to be decentralized, whether it is connected to the grid or goes completely off-grid. 

A decentralized energy system locates the energy generation facilities closer to the site of energy consumption. It also allows the diversification of the energy source as it can be biomass, combined heat and power (CHP), geothermal, wind, and the most common one, solar energy. 

Another element that eases on-site generation are Energy Storage Systems, which can reduce frequency variations by storing energy when supply exceeds demand and feeding it back into the grid during peak hours. Batteries can perform a similar role  for intermittent sources, which often generate at their highest capacities during non-peak hours. 

benefits

Among the advantages of decentralized systems is rural electrification, which can be achieved through off-grid or mini-grid systems. Distributed generation is the best solution for remote areas as these are usually tailored systems according to the low population and their low electricity consumption.

Of course, there are still some challenges when talking about decentralizing the grid such as regulation, infrastructure design, financial and even cyberattacks. However, the benefits outweigh the difficulties and a shift to decentralized renewables is not only good for the grid, but also offers opportunities for new players in energy markets. 

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[1] IRENA (2018), Global Energy Transformation

[2] National Renewable Energy Laboratory, From the Bottom Up: Designing a Decentralized Power System

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