The era of electricity self-sufficiency is coming.

 Was electricity originally a luxury? Did you know that electricity was originally a luxury?

Today, it is thought that anyone can use it by simply plugging in a plug. But, in fact, electricity was close to a luxury that a few wealthy could afford until about 100 years ago.

It is said that most people at that time used more gas than electricity for their daily life.

It is said that about 20 times more people use gas to light their lamps than electricity.

To borrow the expression of a book called 'Grid', which describes life at the time. "Gas was for the masses and electricity was for the few."

Reason for Electricity popularity:

The reason it hasn't become popular is simple.

First of all, even in the big city of Chicago, there were many areas where electricity was not available.

It is said that until the 1890s, there were many DC generators in Chicago instead of AC.

The direct current generator had a fatal disadvantage in that it could not send electricity to long distances.

For this reason, instead of installing a single large generator that spans multiple regions. It was necessary to install several small generators in each region to supply electricity.

If the population of a certain area is small and sufficient demand to install the generator is not guaranteed. The operator will have no choice but to be reluctant to install it.

Therefore, DC generators were installed only in densely populated areas with high operating efficiency to supply electricity.

However, even in the city center, which is a densely populated area, the generator operation rate was not very high.

It is said that when workers moved to the suburbs at night. The demand for electricity fell and the utilization rate fell sharply.

Low utilization means that a small number of customers have to bear the huge cost of electricity production, right?

Due to the structure in which a few pay high fixed costs for installing and operating power plants. The electricity has never been cheaper.

In fact, it is said that electricity in the city was 50% more expensive than gas.  Which was used as a universal fuel at the time.

Samuel Insel:

In those days when electricity was not available or because it was expensive. A businessman named Samuel Insel appeared and popularized electricity consumption.

Samuel Insel, who once served as Edison's secretary, arrives in Chicago in the early 1890s to take over the management of Chicago Edison, an electric utility.

It is said that when Insel arrived in Chicago, there were as many as 20 electric power operators in Chicago.

There are still very few electricity consumers, and even two or three power plants in one area were competing to supply electricity.

Even a small pie had to be shared with several people, so the generators were poorly operated.

Samuel Insel works to eliminate these inefficiencies and create “economies of scale” for electricity production.

Samuel Insel's strategy:

By taking over small-scale power plants that had been sparse, one by one, power plants with low utilization rates or unprofitable power plants are closed and consolidated.

In addition, a DC generator that can supply electricity only in a short distance is removed, and an AC generator that can transmit electricity to a long-distance is installed.

In this way, small-scale generators operated by several independent operators are merged into one large-scale generator operated by one operator to maximize the operation rate.

For example, 10 small generators operating at 7% per day are demolished, and one large generator operating at 70% per day is operated.

Insel's strategy was to lower the unit cost of electricity production by taking advantage of the economies of scale resulting from this.

In fact, when Inseol first arrived in Chicago in 1892, the price of electricity was 20 cents per kWh.

In 1897 it drops to 10 cents and in 1909 it drops to 2.5 cents. It is now possible to supply electricity almost eight times cheaper than the price.

In fact, the number of Chicago electricity consumers, which was only about 5,000 in 1892, increased tenfold to 50,000 in 1906 and quadrupled again to 200,000 in 1913.

It's no longer easy to see multiple generators installing generators and bloody competition over an area, like in Chicago in the 1890s.

And thanks to that, electricity has become universal energy that more people can use without much worry than before.

Reasons for frequent global electricity shortages in 2021

However, the price of electricity that could be used by everyone at such a low price has been fluctuating all over the world recently.

Last year, as news of a surge in electricity rates, which had been stable in the United States, Europe, and China, rose, the electricity supply system, which had been maintained for 100 years, turned on in red.

What happened to the stable power supply systems around the world?

There are two main factors that have contributed to the instability of electricity supply and prices around the world.

 First Factor:

Lack of new and renewable energy supply due to extreme weather The world in 2021 we live in is more dependent on renewable energy than we think.

According to an IEA survey, in 2020, renewable energy accounted for 29% of global power generation.

In fact, the amount of renewable energy generation has grown to a 7-fold scale compared to about 40 years ago.

However, such renewable energy generation has a weakness in that the amount of power generation varies greatly depending on weather changes.

Due to global warming, extreme weather events around the world are becoming more and more frequent.

Also, anxiety about the stability of renewable energy, which is greatly affected by this weather environment, is growing.

Second Factor:

Lack of fuel supply due to changes in the international situation

It is said that last year and this year were the years of "shortage", a supply shortage caused by the corona and international political conflicts.

In China, which stood at the center of it, generators were stopped one after another due to a shortage of coal.

Distributed power, the democratization of electricity production

Another trend that is accelerating the departure from this collective supply system is “distributed power”.

Distributed Power:

Dispersed generation refers to a small-scale power generation facility that can be self-sufficient in electricity by installing renewable energy power plants such as solar and wind power near demand sites.

Dispersed generation refers to a small-scale power generation facility that can be self-sufficient in electricity by installing renewable energy power plants such as solar and wind power near the demand site.

What are the advantages of installing distributed power?

First, the transmission and distribution network installation can be reduced.

In the existing power system, large-scale transmission towers and transmission lines had to be installed to transport electricity generated by large-scale power plants to various locations.

However, in distributed power generation, electricity is generated and used directly near the demand point, eliminating the need for a long and complicated transmission and distribution network.

Second, transmission and distribution losses can also be reduced.

Distributed power for self-sufficiency can minimize the installation of transmission and distribution networks, thus reducing power loss in this process.

Finally, risk can also be diversified.

Although the power supply system centered on large power plants appears to be stable, unexpected accidents can sometimes lead to large-scale blackouts.

For example, 10 years ago in Japan, several nuclear power plants were shut down and destroyed due to the Fukushima accident, resulting in a serious power shortage.

However, if the distributed power supply for home use becomes common. It will have the advantage of being able to receive power stably even in such an emergency situation.

Tesla:

Tesla is advancing the era of distributed power

It is said that products that can build distributed power in each household are becoming more and more widespread.

A representative product is Tesla's Solar Roof.

A solar roof is simply an external solar panel installed on the roof.

In addition to Solar Roof, Tesla is selling a home energy storage system (ESS) called “Powerwall” as a set.

As the name suggests, a power wall is a wall-mounted power storage system.

It receives sunlight during the day and stores the electricity generated by the solar roof in the power wall. And uses it when electricity is needed in the evening when the sunsets.

In addition, Tesla has released a power trading software called 'Autobidder'.

In simple terms, it is an AI-based trading system that can make money by reselling idle electricity at high prices.

Isn't this the ultimate dream of Tesla in a world where electricity price is at the household level?

Of course, this home-based electricity generation/consumption system still has a long way to go.

It is still too expensive to be popular not only in the United States but also around the world. And there are many restrictions on the installation environment.

However, what is clear is that there is a movement in which the subject of electricity consumption, production, and sales is changing from the state and company to the individual.

 

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