Investigators swooped in on Thursday morning, seizing documents and hard drives from the main headquarters of Korea Hydro & Nuclear Power Company.
According to prosecutors who ordered the raid, officials snagged documents that were connected to wrongdoings in supply components for nuclear power plants operating in the city of Busan. This is actually where the largest cluster of nuclear power plants can be found in South Korea.
Apparently, the cables in question failed to meet the stringent standards required to withstand voltage and pressure changes; and it is suspected that management at Korea Hydro & Nuclear were involved.
As a result, South Korea’s energy minister told the public to brace for unprecedented power shortages as it idles these power plants to repair the cable issue and investigate. The government has even announced mandatory power cuts during peak hours.
Meanwhile, here in the U.S., we have nearly half of our fleet of nuclear reactors operating while being in full violation of fire safety regulations. And according to the Nuclear Regulatory Commission, the risk of reactor meltdown due to fire is estimated at about 50%.
Folks, this ain’t reassuring. Then again, what do you expect from a government agency that’s charged with the responsibility of protecting the public?
In any event, this is what we deal with when we choose to rely on nuclear to keep the lights on.
But let me clarify: This doesn’t mean nuclear is an unsafe option…
One Size Does NOT Fit All
No form of power production is environmentally benign. Although, as we’ve seen in Fukushima, the health concerns and environmental destruction resulting from nuclear meltdowns are much more severe than those from natural gas explosions or falling wind turbines.
But again, that’s not to say nuclear power isn’t necessarily safe. As I wrote a couple of weeks ago:
Chernobyl and Fukushima were not nuclear crises because the process of nuclear power generation is inherently unsafe. They were crises because of human error. Lax policies, sub-par safety procedures, and poor logistical planning were to blame in both of those instances, not the splitting of isotopes.
Today I’m going to take this one step further by pointing out that even when we are operating our nuclear power plants in a safe and efficient manner, it’s downright stupid to rely on nuclear for the lion’s share of our power.
This holds true for any form of power generation.
In the United States, nuclear only represents about 20% of the power we generate. This is a rational percentage, and I suspect it’ll never be much more than that.
In fact, I believe it’ll be much less in 20 years. And perhaps this is a good thing, as we embrace distributed power and learn how to rely less on less on a one-size-fits-all system that inevitably leaves us vulnerable to both acts of God and acts of terrorism.
Hooked into the System
It’s pretty simple when you think about it…
When the proverbial poop hits the fan — either from a major power plant going down due to a hurricane, or a major grid connection bring taken down by an act of terror — those communities that rely on decentralized power (i.e. the generation of electricity from many small energy sources as opposed to one, large centralized power plant) are at a significant advantage.
Of course, such communities are few and far between in the U.S. But if the entire country embraced distributed generation, as a nation we would be much better off environmentally, security-wise, and even economically.
In fact, according to analyst Thomas Beach of Crossborder Energy, distributed solar generation and net energy metering in Arizona alone could provide customers with $34 million in annual benefits.
In his 2013 report, Beach found that for each dollar of cost, distributed generation provides $1.54 worth of benefits to customers. Some of these benefits included savings on expensive conventional power plants, reduced investments in transmission and distribution infrastructure, and reduced electricity lost during transmission over power lines.
Also worth noting is a 2002 study conducted by the Rocky Mountain Institute that found accounting for the economic benefits of distributed electrical resources typically raises their value by improving system planning, construction, operation, and service quality.
Of course, none of this really matters to the power companies… After all, they make money when they get you hooked into the system.
Break those chains, however, and they lose revenue. Sadly, this is an inconvenient truth that many in the energy industry refuse to discuss honestly, as they don’t want to piss off the major utilities.
I also believe that this is what long kept the growth of distributed power to a snail’s pace. But this is changing — particularly due to the economic and national security benefits of integrating more distributed generation systems, or microgrids, into our overall energy and infrastructure mix.
$12.7 Billion in 5 Years
Microgrids serve to represent distributed generation in action — that is localized groupings of generation, storage, and loads that don’t need to be connected to a centralized grid.
According to Pike Research, the total worldwide capacity for distributed generation contained in microgrids will more than quintuple over the next five to six years. And by 2018, the annual market will reach $12.7 billion.
Senior analyst Peter Asmus noted:
Microgrids represent a fundamental building block of the ultimate smart grid, designed to serve the needs of energy producers, consumers, and distribution utilities. Perhaps most importantly, microgrids are an important accelerator for various kinds of distributed power generation, particularly from renewable sources.
I definitely believe the big winners on distributed generation and microgrids will be in the solar space, particularly those solar manufacturers that are increasing efficiencies and enabling drastic cost reductions.
It’s not particularly exciting, but the action is. And quite frankly, the stage is being set for some serious growth in the distributed generation market.
To a new way of life and a new generation of wealth…
Jeff Siegel
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Jeff is the founder and managing editor of Green Chip Stocks. For more on Jeff, go to his editor’s page.
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