Distributed generation

Distributed generation is electricity produced by relatively small-scale units connected to distribution networks or located near the consumers they serve. It contrasts with electricity supplied solely by large, centralized power stations.

Distribution network: The part of an electricity system that delivers power from substations to consumers. Distributed generators connect to this network, often supplying power close to its loads.
Rooftop solar power: Electricity generated by photovoltaic panels installed on building rooftops. Rooftop systems are a familiar form of small-scale generation near household loads.
Centralized generation: Electricity production concentrated in large power plants that supply broad areas through transmission networks. It is the principal organizational alternative to generation dispersed near consumers.
Hosting capacity: The amount of distributed energy resource capacity a distribution network can accommodate without unacceptable impacts or upgrades. It sets a practical limit on new generators connecting to particular feeders.
Electricity tariff: A schedule of prices and charges governing electricity service and use. Tariff design determines how distributed generators are paid and how network costs are recovered.
Grid interconnection: The technical and contractual process of connecting an energy system to an electric grid. Interconnection determines how a local generator can operate alongside the wider network.
Combined heat and power: The simultaneous production of electricity and useful heat from one energy source. Facilities can use local generators for electricity while capturing heat that centralized plants often discard.
Transmission system: The high-voltage network that carries bulk electricity over long distances between generators and substations. Centralized plants typically send power through transmission before it reaches distribution networks.
Duck curve: A graph of net electricity demand that shows a deep daytime dip and steep evening ramp, notably in solar-rich grids. Concentrated distributed solar can reshape net demand and increase the need for flexible evening supply.
Locational marginal pricing: An electricity-market pricing method that calculates the cost of serving one additional unit of demand at a specific location. Its treatment of local network constraints informs debates about the value of generation near loads.

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