As a global energy system evolves towards greater flexibility and resilience, decentralized renewable energy is becoming an increasingly popular option for homes and communities. These systems of interconnected buildings power themselves through renewable energy sources and combine multiple energy carriers, including electricity, heat and storage technologies.
Increasingly, these decentralized power resources are acting as real-time demand response assets. As a result, they are critical to supporting markets in their quest to ramp up renewable generation, increase energy diversity and boost grid flexibility.
Reduced Upfront Costs
Decentralized renewable energy is an effective and low-cost way to reduce the cost of electricity while improving the overall quality of life in our communities. It can be implemented by homeowners, small businesses, and local governments in a variety of ways.
Solar and wind technologies are now relatively inexpensive compared to their fossil fuel counterparts, making them a feasible option for most of us. Aside from cost, harnessing these energy sources also has the benefit of reducing carbon emissions.
However, there are some downsides to deploying renewable power technologies at scale. The most obvious one is the high costs associated with transmission lines. A better approach is to focus on locally generated electricity that can be stored for peak times. Depending on the technology, this might be done with batteries or through small-scale micro grids.
Lower Energy Bills
One of the biggest advantages of decentralized renewable energy for homes and communities is lower energy bills. This is especially true if your utility provider spikes rates during peak use hours, which many do.
As a result, a lot of households have saved a significant amount of money on their energy costs over the years. Moreover, you can also find a number of year-round discounts on your energy bill that can save even more money, so it’s definitely worth checking with your local utility company to see what they have in place.
Nevertheless, there are some drawbacks associated with using solar and wind (variable renewable energy) in an energy system. Those include costs for the electricity generation and the required corresponding storage capacity. This has led to a growing interest in the use of electricity storage technologies.
Reduced Carbon Footprint
A carbon footprint is the amount of greenhouse gases (including CO2, methane, nitrous oxide and fluorinated gases) that are emitted by our activities. This includes everything from driving to shopping, to heating our homes and cooking.
Decentralized renewable energy systems have the potential to dramatically reduce our carbon footprint. They can also help us achieve climate neutrality, a goal that is set by many countries and companies.
One way to lower our carbon footprint is by cutting down on the number of miles we drive. This can be done through organizing our trips, walking or biking when possible, and using public transportation.
A similar approach can be taken with home heating. By insulating and trapping heat effectively, we can cut down on our use of gas and electricity – the largest contributors to our carbon footprint.
Increased Community Empowerment
Decentralized renewable energy for homes and communities is a powerful way of boosting community autonomy. Studies have shown that when a local community is involved in a RE project, it is more likely to accept the construction of such facilities than if they were not.
Another benefit of these decentralized systems is that they can be adapted to local conditions. They are more affordable, reliable and easier to maintain than centralized energy solutions.
In addition, they can be used for local economic activities and create jobs. For example, solar PV and wind generate 5.7 person-years of employment per $1 million of investment (Pachauri 2009).
However, it is important to remember that decentralized renewable energy projects aren’t without their challenges. Repair and maintenance loans, recurring costs and the lack of credit are common issues that can impact rural communities’ ability to access these energy options. In addition, some community members may not be aware of the benefits of these technologies.