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A guide to micro-generation in New Zealand

Tuesday, April 12, 2011
New Zealand is blessed with abundant renewable energy resources compared to many other countries, and this has helped achieve a high percentage of renewable generated electricity in our electricity grid. Large-scale renewable energy development, such as wind farms, geothermal, and hydro energy, already provides cost-effective and ‘clean’ electricity.

Another way of harnessing the power of New Zealand’s renewable energy resources is through small-scale generation, also known as ‘micro-generation’. This is renewable energy generation on a domestic or household scale.

The motivation for homes or businesses to generate their own electricity using photovoltaic (PV) modules, small wind turbines, or micro-hydro schemes can come from the satisfaction of gaining independence from conventional electricity supply arrangements, or the desire to contribute to greater environmental goals. Improved security of supply and a favourable financial return can also be factors, especially for those whose home or workplace is located in isolated areas where generating their own electricity can be the only viable option. In many remote sites, off-grid power systems using renewable energy technologies are often more economic than relying on diesel generators, or financing the costs of connecting to the local electricity network.

Micro-generation is also an important component of what is emerging as the ‘smart-grid’; a concept that replaces the existing model of one-way electricity supply from centralised generation plant to end users with an arrangement that allows for electricity to flow in optimal ways and directions, depending on the conditions at the time. Micro-generation may allow previously passive consumers of electricity to become more engaged and active participants in managing their energy needs.

Technology improvements and decreasing costs of some micro-generation, especially PV, along with rising energy prices and a growing popular interest in sustainability, mean that micro-generation is likely to become increasingly attractive and cost competitive, leading to greater uptake.