Global Initiative for Distributed and Local Energy (DALE)

Vision, Mission, and Possible Strategies
Draft discussion document, April 22, 2017
by Eric Martinot, Director

Click Here to Join Us -- Let's Build the Initiative Together!


CONTENTS:

Vision
Mission
What is Distributed and Local Energy?
Possible Initiative Strategies
Initiative Formulation Questions
Initiative Origin and Funding

Vision

We envision a world powered almost entirely by renewable energy, with over half of that renewable energy in the form of distributed and local energy. In this vision, distributed and local energy not only provides power, heating and cooling, but also contributes to economic decentralization, more sustainable cities and towns, local ownership, local jobs, local resiliency, environmental quality, and new solutions for housing, transport, and water. Distributed and local energy also becomes an integral part of the sharing economy and transformation of communities.

Mission

With the tremendous market growth and cost reductions of renewable energy over the past several years, distributed and local energy has emerged as a profitable alternative to the reigning centralized energy paradigm of the past hundred years. Tens of millions of households and businesses around the world already get some of their energy from distributed and local sources of renewable energy. And these distributed and local sources are becoming more tightly integrated with other technologies like energy storage, low-energy building designs, flexible energy demand, and electric vehicles, and also with the power grid itself. Such integration is leading to greater benefits and many potential routes to higher profitability.

Our mission is to support and facilitate the global transition to much greater use of distributed and local energy, community-by-community, city-by-city, and to emphasize and make visible solutions, models, and policies that result in local ownership and that provide income to cities, local communities, local businesses, and individuals.

We will tell the ongoing story of distributed and local energy around the world–including how individuals, communities, cities, and businesses are making choices, solving problems, and earning income. We recognize that collaboration, synthesis, video-rich media, and many-node networks are needed to tell this story. Physical travel and conferences are inadequate, while person-to-person connection, inclusion, and community are essential.

We will help others decide to act and learn how to get started. We will build a vehicle to uncover, curate, and share "gems" of wisdom and experience for solutions to common problems. We will help foster a common vocabulary. We will support utility and regulator buy-in for new practices and policies, while aiming to redirect vested interests in productive directions. We will help the array of energy consumers, from cities to facilities managers to households, to ask the right questions, and to identify existing costs that can be eliminated with distributed and local energy.

We will connect and make more visible the valuable work by so many around the world. We will paint virtual landscapes of cities, community groups, non-profit organizations, advocates, cooperatives, companies, industry associations, researchers, consultants, and others working across the spectrum of distributed and local energy. More connections and commonalities can help get things done faster, better, and with fewer mistakes. In doing so we will be inclusive and facilitative, enabling these constituents to see how their activities connect to a bigger picture for learning and mutual support.

We will go beyond reports and conferences, recognizing that the world is already well served by others producing reports and organizing conferences. We seek to develop decentralized and collaborative forms of facilitation and knowledge that are increasing possible and effective in our era of online tools, platforms, video communication, and video-based knowledge. And we seek especially to assist those making decisions, those creating plans, and those learning how to get started.

Finally, we will target and track specific measurable outcomes, facilitate those outcomes, and report on their achievement. What those outcomes should be, and what activities will facilitate them, will be defined in scoping and prototyping during the first years of the initiative.

Our mission extends long-term, to 2035 and beyond. One possible long-term goal of the initiative is that by 2035, at least half the world’s individual and business energy consumers should be receiving some of their energy from distributed and local sources, or have readily available to them the viable and competitive option to do so.


What is Distributed and Local Energy?

What is “distributed and local energy”? There are many forms, along a spectrum of technologies, business models, social models, ownership forms, stakeholder involvement, and policy environments. Distributed and local energy can serve the full ranges of built environments, economic groups, and geography -- urban, peri-urban, suburban, islands, rural villages, agricultural lands, recreational vehicles, manufactured housing, "tiny houses", and off-grid dwellings. The spectrum includes several application levels:

  • Renewable energy at any individual building level, including residential, commercial and industrial buildings, can include not just solar power, but also solar, geothermal and biomass heating and cooling, along with electricity and heat storage, and can become tightly integrated with building energy management and energy efficiency.

  • Micro-grids, which can serve clusters of buildings, industrial parks, campuses, villages, or other defined-community configurations, can be powered by all forms of renewable energy and can also include heat supply from combined heat-and-power generation.

  • Mini-grids are a larger but similar option to micro-grids, often for entire off-grid rural villages and islands.

  • District energy systems can supply heating and cooling to entire neighborhoods or zones of an urban area.

  • District-level, zone-level, and city-level urban or community planning can target, plan, and collectively implement many options for renewable energy at the urban level that integrate with urban sustainability goals for buildings and housing, for transport (including electric vehicles and biofuels), for local food and agriculture, and for water systems.

  • Locally-sited renewable stand-alone power plants can feed power into the local grid and serve local consumers, and can be considered "distributed" if their generation is consumed locally and not exported into the transmission system.

  • Power distribution grids at the local and neighborhood level can become more autonomous and more self-balancing with both generation and consumption, more supportive of local energy markets (i.e., local business-to-business energy trading), and more of a contribution to regional or national electricity markets in new ways. (A good example of this in the United States is the New York “Reforming the Energy Vision” initiative.)

There are seven further dimensions of distributed and local energy:

1. Ownership and business (energy service) models. Household rooftop solar power, in both single-household and multi-household buildings, can be owned by the household(s), leased from a third party, or owned by a third party selling the power to household(s). Households, as well as owners/operators of any building-level renewable energy system, can sell surplus power back to the grid, or directly to other local consumers via peer-to-peer and business-to-business transactions. Microgrids, minigrids, and district energy systems can be developed, owned, and operated by a community association, by a dedicated third-party energy service company, by an industrial association, by the local government, with a wide variety of energy service, purchase, and pricing models for consumers connected to the micro/mini-grid. Local stand-alone wind and solar plants can be local-business-owned, community-owned, or cooperative-owned, and can sell power to the grid, or to local consumers via peer-to-peer, business-to-business, and a variety of other retailing models. A central challenge here is "how to define the model so it works."

2. Social concepts and associations. Closely related to ownership and energy-service-provision is the emergence of many new social (and political) concepts and associations, such as “solar citizens” and “community solar gardens,” “community wind farms,” and “community choice aggregation.” Such social concepts and associations are variations on ways that local choices and decisions can be made to own renewable energy directly, or to buy renewable (“green”) power at a collective or community level.

3. Enabling technologies. Distributed and local energy can consist of not just the renewable energy sources themselves, but complimentary and enabling technologies that together can provide the full range of energy services, capabilities, and value. These technologies include local energy storage (of both electricity and heat), demand flexibility (called “demand response”), smart inverters (for solar power panels), metering and control that allows response to dynamic or time-of-use electricity pricing, and of course all the information technology needed to allow local energy transactions and markets to function. Electric vehicles charged from local renewable energy sources, integrated with building energy systems or stand-alone charging/discharging are also part of the picture, and can buy and sell local power using their batteries in service to not just mobility but also to a flexible, balanced, and resilient power grid.

4. Aggregation. Distributed and local energy can be aggregated to offer a variety of “grid services.” Aggregated together in the thousands or millions, the owners and operators of distributed energy can contribute to power grid support and flexibility, and thus aide the balancing and integration of much higher shares of renewable energy of more centralized and concentrated types (i.e., large-scale wind farms and large-scale stand-alone solar power plants). So-called “virtual power plants”, which consist of large numbers of individual distributed generators, energy storage units, and/or flexible-demand (demand response) consumers aggregated together under a single controller, are another concept for providing grid services, as well as energy and capacity to both centralized (transmission-level) and local (distribution-level) grids.

5. Valuation. The "value" of distributed and local energy potentially includes many elements that are not currently counted or compensated monetarily in existing regulatory/pricing frameworks or business models. This means investors and owners do not obtain the full economic income and profitability possible. Such value can include the "grid services" described in the "aggregation" paragraph above, along with avoided (or deferred) investments in transmission and distribution grid infrastructure that may arise from distributed energy (and which can depend on the specific geographical location of distributed energy within a power grid). Value can also encompass avoided costs in power conditioning equipment needed to ensure power quality from the grid, and avoided costs of back-up generators for ensuring reliability from the grid. Furthermore, the economic value of distributed energy to a particular investor, household, or business often depends on the proportions of distributed and local generation that can be "self-consumed" versus those proportions that must be "sold into the grid." These proportions often depend on the pattern of electricity demand in a household or business, whether any energy storage exists, season of year, etc. Value, and thus profitability, is very much a function of the regulatory regime of prices for buying and sell power at different times of day, the design (structure) of the electricity market, and what "product" from distributed and local energy is actually being bought or sold. (Examples of "products" include energy, capacity, voltage regulation, reactive power support, and ancillary service, along with associated attributes like power quality, reliability, etc.)

6. Energy efficiency. As more and more energy comes from distributed and local sources, the importance and value of energy efficiency (of energy-consuming equipment and infrastructure) can become more visible and tangible. Local investments in energy efficiency will have a more direct bearing on the costs of, and service levels needed from, distributed and local energy supplies. Trade-offs and optimizations of investments in supply and end-use efficiency become more localized and can have greater influence on decision-making. Energy efficiency investments can also impact the proportions of distributed and local energy that can be "self-consumed" versus the proportions that are "sold into the grid", as discussed in the "valuation" paragraph above.

7. Inter-operability. Several aspects discussed above--for example micro-grids, integration with enabling technologies, aggregation, valuation, energy efficiency--point to growing needs for "inter-operability" across distributed and local energy solutions. This can mean standards, protocols, plug-and-play designs, communications, data, applications standards, and other new integrative approaches. These challenges will cut across many industries and dominate efforts for many years.


Possible Initiative Strategies

There are many possible strategies that the initiative could pursue. In the initial prototype phases, and with guidance from participants and partners, these strategies can be explored, defined, and tried.

Prototyping: The initiative as a whole, or sub-parts of it, or individual strategies, can be prototyped at different levels below the global level, including at the community-level, city-level, state/provincial-level, and national-level. These prototypes can identify effective strategies suited to specific conditions, create coalitions of stakeholders, and also begin to catalogue the range of existing real-world experience, as well as show emerging business, financing, social, and policy models. Prototyping could be done at different levels by individual organizations or coalitions of organizations working together.

Below are ten possible strategies that could be prototyped and/or incorporated into the initiative.

1. "Gems of wisdom and experience" -- uncover, curate, and share gems for solving common problems and making things happen. Identify and link to as many sources worldwide of relevant cases, stories, and lessons as possible. Collect, develop, aggregate, and disseminate, with the view to helping others think-through and implement their own solutions and projects, and introducing them to new ideas. Recognize context dependencies but also isolate elements of stories and solutions that are common across situations. Publish online in video form, as a growing video library with its own topical catalogue and roadmap.

2. "How to get started" -- identify, curate, and fit together decision-making tools that can help people, communities, and organizations get started and make choices that will give them the most benefit from distributed and local energy.

3. "Connections" -- with people, organizations, companies, industry associations, social associations, and local governments, typically at the community-level, city-level, or regional-level. Connect stakeholders working along the entire spectrum of distributed and local energy, so that they can benefit from others’ activities, reduce isolation, share intellectual resources, learn from experience, become more visible, and gain greater access to tools, services, and information to help them with what they are already doing.

4. "Understanding what's happening" -- make an organizational and facilitation-oriented mapping and landscape of all activities globally related to distributed and local energy. Use different views of this landscape to identify and make visible synergies, connections, solutions, and potential partnerships, as well as fundable and aggregated opportunities for funders or coalitions.

5. "The role of battery storage" -- as an example of a specific topical focus, point to existing work about the emerging trends and models in integrating batteries with distributed solar power, particularly at the building level ("behind the meter"), including the role of electricity rate design and how storage can increase income from distributed and local energy, and strategize and implement ways to inform actions and choices related to storage.

6. "Local governments" -- connect the initiative with local governments, local policy-making, and local planning processes at district, city, county, or state levels. Connect to help facilitate actions, plans, and policies that will enable distributed and local energy, as well as local economic benefits consistent with the initiative's mission and vision.

7. "Distribution utility buy-in" -- understand electricity market regulation and development in specific jurisdictions related to distributed and local energy, including actions and plans by distribution-level electric utilities. Build utility buy-in for planning, operation, and innovation that enables (rather than potentially hinders) distributed and local energy.

8. "Social concepts and associations" -- spread social concepts and association models, such as “solar citizens” movements, peer-to-peer energy trading, local energy cooperatives, solar gardens, and many others. Help existing associations see themselves in a larger global context and gain greater visibility for their concepts and models.

9. "Advocacy and education." Advocate for and provide education on distributed and local energy among communities, city-level planners and policy-makers, business groups, and a wide variety of other stakeholders. Advocacy may also include ways to redirect vested interests in productive alternative directions.

10. "Policy understanding and advocacy" -- understand, identify, and advocate for policies and regulatory frameworks that better support distributed and local energy, at local, state/provincial, and national levels. Energy policies, sector policies, and electric-power regulatory frameworks at local, state/provincial, and national levels underlie all dimensions of distributed and local energy. It is very well known that supportive policies have been and will continue to be a critical part of the picture, and a central challenge. However, many are already working on policy understanding and advocacy, so the scope for this initiative is uncertain.


Initiative Formulation Questions

We seek ideas on any of the following questions, or other aspects of the initiative's vision, mission, strategy, and activities. You can email them to Eric Martinot and/or request a phone meeting to discuss.

1. In what ways should the initiative advocate for, and facilitate, the transition to distributed and local energy?

2. What should be the targeted and measurable outcomes of the initiative, over different time frames?

3. What should be the specific activities that the initiative undertakes? As the strategies for those activities develop within the initiative, who would fund them?

4. How to reconcile the local nature of action, investment, and knowledge, with the global nature of the initiative, learning, and synergies that are possible? (And across different policy, business, social, and cultural contexts of different jurisdictions.)

5. What are the best ways to organize, connect, and manage those interested in contributing to the initiative?

6. Who are the real “clients” of the initiative, and what will serve them the most, what will actually give them real value they can use? What is that value?

7. How to involve, connect to, and provide benefit to the product and service providers, that is, the companies that provide services and/or products that are used in distributed and local energy projects.

8. How to involve the existing owners and operators of distributed and local energy projects, from households with one solar roof, to large international multi-project developers.

9. How to connect with city government agencies, departments, councils, and mayors? What will help them the most?

10. What could be the tangible benefits of connecting companies, entrepreneurs, households, cooperatives, community associations, advocates, local government planners, policy makers, researchers, and media across the world, that are all in one way or another working on or supporting distributed and local energy, and of targeting and facilitating their collective actions?


Initiative Origin, Funding, and Governance

Eric Martinot is creating and directing this initiative. For the past twenty years he has been synthesizing renewable energy information and writing about experience and lessons, global status, global futures, local renewable energy policies, and grid integration of renewable energy. His career has been driven by his deep personal commitment to a renewable energy future. Hundreds of thousands of people have read and benefited from his work, and have been inspired and informed and better positioned to make renewable energy happen. "Now its time to change gears! Let's build and lead something together, a collaboration that can change the world!" he wrote to his email list of 3500 renewable energy colleagues, almost all of whom he has personally met or communicated with over the years.

The initiative is a reflection of Eric's deep understanding of renewable energy markets, policies, investments, and trends at local, national, and global levels. The initiative also reflects a recognition that the "distributed energy space" remains fragmented, tentative, poorly understood, and under-appreciated relative to its enormous future potential, at least in most jurisdictions and in most people's thinking. For renewables to achieve their full global potential, the centralized part of the picture will not be nearly enough. The biggest challenges lie ahead in distributed and local energy, as well as the biggest benefits for cities, local communities, local businesses, and individuals.

The initiative is intended to be collaborative and inclusive, reaching out to all corners and aspects of distributed and local energy, and not be limited to a small group of organizations, companies, or funders. Of course, we will have to start with some specific activities, including prototyping and piloting of activities and strategies in different jurisdictions, to discover how to make a difference consistent with the initiative's vision and mission. Plus we will need to create partnership concepts and strategies.

The initiative is starting as an all-volunteer effort, entirely unfunded (with the exception of Eric himself). As others join to contribute, guide, and co-lead, we will have to address the question of funding. Eric does not envision competing with other organizations for traditional sources of funding. Rather, long term he envisions distributed and local sources of funding, perhaps crowd-funding or micro-payments, or other ways to capture value-added that the initiative creates.

Governance and structure of the initiative will need to be created as the initiative gets built over time, perhaps starting very simply and evolving over time. There are many possibiilties, and no ideas are being excluded at the outset.


Page updated April 22, 2017