Distributed Generation Market to Thrive Despite High Natural Gas Prices

The Potential U.S. Market for Distributed Generation estimates the market potential for new distributed generation (DG) in the U.S. to be 28 gigawatts, with three-quarters of the applications being combined heat and power (CHP). If DG is installed at all these economically viable locations, the size of the currently installed 18 gigawatt market would more than double. California, New York and Michigan are the leading states. This is the first published national assessment based on todays higher natural gas prices. Organizations seeking to be successful players in the DG market will benefit from the market intelligence in this report and will gain an understanding of the size of the potential new market and specifically where DG will be adopted.

Vienna, VA (PRWEB) August 27, 2004 --- The Potential U.S. Market for Distributed Generation

A report titled The Potential U.S. Market for Distributed Generation" has recently been published which estimates the market potential for new distributed generation (DG) in the U.S. to be 28 gigawatts, with three-quarters of the applications being combined heat and power (CHP). If developers installed DG at all these economically viable locations, the size of the currently installed 18 gigawatt market would more than double. California, New York and Michigan are the leading states. This is the first published national assessment based on todays higher natural gas prices, and the first to forecast market potential for all 50 states. The report examines fossil fuel-fired DG technologies and covers baseload, CHP, and peaking applications. Results are tabulated by DG technology, size, application, state, and end use sector -- helping many stakeholders target specific market niches to pursue.

The report shows that the number of DG units will grow significantly. Organizations seeking to be successful players in the DG market must have this market intelligence -- an understanding of the size of the potential new market and specifically where DG will be adopted. New DG technologies and recent changes in fuel prices will have a profound effect on the marketplace. Market potential varies considerably depending on the underlying assumptions, but the market is likely to at least double in size over the coming decade, and under certain market conditions could eventually add 4 times as much capacity as has been installed to date.

To measure this, five different cases were prepared, starting with the Base Case market potential given todays DG technology price and performance, current gas prices, and expected escalations in gas and electricity prices. Four additional cases examine the sensitivity to capital cost, gas prices and competing electric prices. Each case projects whether DG can economically beat the electric grid price for a particular user, including recovery of capital investment in the DG unit. Each and every commercial and industrial enterprise in the U.S. is modeled to determine whether they can save money with DG. The analysis considers actual tariffs from the utility where the user is located, and is not based on average electricity prices. This report can be ordered at www.distributed-generation.com

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