With the drop in the price of distributed energy systems (mainly solar PV), the cost of energy for some prosumers becomes lower than the one provided by the grid. They are then tempted to severe their tie to the network to escape its cost. The burden of the cost of this mutualized infrastructure would then have to be socialized on fewer customers, pushing more of them to leave their electric utility to become automous prosumers. This is what is called the “Utilities death spiral”.

 

But this misses the point that the grid brings much more than just kilowatthours to its customers.

  • First, it brings a reliability, thanks to mutualized back-up, that could be matched on an independant energy system only with over-costly redundancies of generators.
  • Second, the grid can supply the in-rush current some equipments need to be started, for example motors. Relying only on local energy generation would require to oversize it just for those few seconds when the fridge or air conditioning compressor kicks-in.
  • Third, the sheer size of the electrical system enables the grid to provide high quality voltage and sinusoid that modern equipments require. In automous systems, harmonics that harm the lifespan of machines and electronics are difficult if not impossible to dampen.
  • Fourth, the overall efficiency of the electrical system is better if generators connected to the grid can merge all their outputs, given the fungible nature of electricity, while running at their best efficiency ratio. Any local generator would have to run close to the profile of the loads connected to it, thus often operating out of its ideal efficiency range. For example, a Combined Heat and Power system (CHP) will not run at its optimum if heat and electricity are needed at the exact same time.
  • Last but not least, being connected to the grid gives the ability to engage into energy transactions. Obviously, an islanded system won’t have access to energy markets nor any possibility to sell its excess power.


The grid brings so much more than kilowatt-hours that it is here to stay. There certainly is an issue in the way utilities pass on the cost of the grid to its prosumers, but this the regulators’ mission to find ways for a fair pay of the grid's value.