Editor & Publisher, Marcellus Drilling News (MDN)
Home generation of electricity using personal generators powered by natural gas are on the horizon and can be a nice complement to solar energy.
Last December I, on behalf of Marcellus Drilling News (MDN), I attended and reported on the Platts Global Energy Outlook Forum in New York City. One of the most interesting speakers at that event was David Crane, CEO of electricity-generating giant NRG Energy. At that event Crane touted a pretty radical idea: home generation of electricity. About 1/3 of all U.S. homes have natural gas pipelines running to them. Crane believes technology exists to allow those homeowners to produce their own electricity with small units powered by natural gas, thereby cutting out the local electric utility. A recent article in Forbes magazine details why Crane’s idea isn’t just idle speculation.
Home Generation of Electricity with Natural Gas on Horizon
I reported the following from the Platts event:
Crane proposed something that the other panelists seemed to be skeptical of, but is an intriguing notion all the same. Crane spun this argument: Currently some 34 million (out of 80-90 million) American homes have natural gas pipelines right to the house–to deliver gas. He believes that gives the gas industry an opportunity to “disintermediate” electric utilities. Crane said technology exists and is being developed that will allow homeowners to create their own electricity by using natural gas. So a homeowner would no longer need an electric line to the house–or if they did, it would simply be a backup system and not the main system. Crane postulated (predicted?) that such a change is on the way in the U.S.
The Forbes article brings to light how Crane “eats his own dog food,” meaning he has a unit in the basement of his Princeton, NJ home that yes–uses natural gas to produce electricity. It is, for now, a backup generator–in case electricity from the pole (or in Crane’s case, from the solar panels on his roof) goes out. The unit is experimental and only the second one built by the same guy who invented the Segway scooter–Dean Kamen.
The natgas using/home generation/electric producing contraption is called a Beacon 10 and it’s taken Kamen ten years of experimentation to refine it. The Beacon 10 uses a Stirling engine, which is much more efficient than other types of engines. The Stirling engine uses heat to push a gaseous fluid, driving a piston. Essentially a Stirling engine converts heat energy into mechanical energy. Burning natgas provides the heat (we assume).
Crane is helping Kamen “work out the kinks” in the Beacon 10 by providing a live, living laboratory–Crane’s house. Crane is a big solar advocate. As we noted in our Platts coverage:
NRG owns a number of coal-powered electric generating plants, but is committed to transitioning them. But that transition, according to Crane, will happen over a number of years (decades) and in the meantime using coal to generate electricity is a necessity in the U.S. Crane said that a few years ago NRG went in big for wind power but quickly became disillusioned with it, for various reasons. Today NRG is pragmatic in using coal and natural gas, but their future (said Crane) is in solar. And so they continue to concentrate their future forward-looking efforts on the solar space. Crane said selling solar to a consumer is much more personal than selling wind power and other forms of power. A rep goes to a home, sits at the table with the homeowner, and talks about how it’s going to look and work with solar panels installed on the roof. It’s more tangible–gets you up close and personal with the customer. And he likes that aspect of solar.
Home Generation Is All About Solar and Natural Gas – Combined
NRG is a big coal-burning electric generator, but Crane’s vision for NRG’s future is solar–and for at least for a generation–in natural gas. NRG is rapidly expanding their solar business with a somewhat different and unique model: Consumers don’t buy solar panels from NRG, they lease them. Crane hopes to do the same thing with personal natgas generators like the Beacon 10.
The Beacon 10, according to Kamen, could be manufactured and installed for about $10,000. It produces a hefty 10 kilowatts of electricity–about five times more than the average household uses. Kamen plans to produce a 2.5 kilowatt version soon.
Crane’s plan is to partner with Kamen and, as they do with solar panels, lease Beacon units to homeowners, making it less expensive for a homeowner to transition to the new electric source. NRG can lease you both your solar panels and a natgas electric generator. Snip snip go the electric lines! (Or rather, they stay in place as a backup.)
Crane is crafty, however. If the Beacon is on and producing more electricity than the house needs, NRG will sell the excess electricity back to the grid for a tidy profit.
A big hat-tip and thank you to ongoing MDN contributor and friend Chris Acker. Chris, as you may recall, is a retired geological engineer with an MBA. He grew up in the oil fields of Venezuela where his father, a petroleum engineer, was a drilling contractor for all the major players, onshore and off. Chris owns a house in Montrose, PA and leased his land to Cabot Oil & Gas. He now has two shiny new natural gas wells sitting a few hundred feet from his house–and he loves it! Chris is also personal friends with his old Princeton classmate David Crane. Chris alerted us to the pair of articles in Forbes.
Editor’s Note: Also see this article for another example of the potential for home generation of electricity.