White Paper

Girding the Grid

How Utilities Reduce Costs and Boost Efficiency with Gas

by Michael A. Devine
Caterpillar, Electric Power Division
Gas Product Marketing Manager

Distributed generation has gained favor as utilities seek cost-effective ways to keep up with rising demand for power. The concept helps forestall construction of costly centralized power plants, and power used near the point of production limits stress on distribution and transmission systems.

Natural-gas-fueled reciprocating engine-generators have served well in distributed generation service, delivering reliable power, ease of service, and low life-cycle cost. Now, near-record-low natural gas prices in many countries make reciprocating engines even more attractive. When deployed for peaking support and other strategic purposes, they deliver high efficiency, increase the diversity of the power generating portfolio, protect power quality, and shield against market power price volatility. They also offer potential for profitable heat recovery in combined heat and power configurations.

All of these factors can help utilities improve their financial position, differentiate their service to customers, retain and attract commercial and industrial users, and support community economic growth. The key to using gas-fueled distributed generation is to deploy units strategically and dispatch them intelligently, with full understanding of market dynamics, daily and seasonal load profiles, and the relative costs of different generating resources.

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