Decentralization, as the name implies, is the process of distributing and dispersing power away from a central authority. For power systems in Nigeria, that will be the transformation of our “one-way street” of energy into a multi-directional, peer-to-peer network.
Centralised power generation is giving way to decentralised systems. This is because new technologies continue to create cheaper and more efficient forms of power generation, storage, and transmission.
This evolution has already begun. Decentralisation will change how we generate, store, move and consume energy.
The social media analogy
Just like everyone now can receive news from a million sites, on-demand, and broadcast to thousands of friends and followers via various social media platforms. So too, with advances in power generation and storage, smart metering technologies, we are beginning to develop a similar capacity.
Some large institutions who cannot depend on the grid both produce and consume electricity. Let’s call them prosumers because, when they produce excess energy they can now sell to residential areas. When they need power they can buy from the grid or other prosumers, therefore reducing their dependence on centralised power stations.
This would encourage private investments in local solar plants and wind farms, supplying power to the interconnected grid. This network of private generating stations, prosumers and consumers will create a robust decentralised power network.
You too could sell energy
If you have installed a solar generator at home (if you haven’t, here’s a good reason to), there inevitably would come the time when your batteries are charged up while the sun smiles brightly. Your panels are producing energy but it’s all wasted. You cannot store more energy.
Installing a smart meter and a few sensors could set you up as a Prosumer. Your smart meters will measure and report energy production, consumption, and excess energy to a mobile app. You could then sell the surplus to the consumer markets via an online trading platform.
Smart contracts and a blockchain network could even automate these transactions. It would facilitate the production, transmission and distribution of energy. Blockchain technology makes it easier to scale a decentralised power grid.
Why it’s Important
The benefits of decentralisation, as regards power, are numerous. Deploying solar plants, small wind farms, battery storage and combined heat-and-power plants will drive your electricity bills down, as the number of energy providers goes up.
It will give more control to communities over the sources of energy they consume (hopefully in favour of renewables). It will also offer new opportunities for revenue and provide backup power to the national grid. Localised power is often renewable, it will cut carbon emissions.
If Nigeria envisions at least 95%+ electrification rate, decentralised power in Nigeria is our most viable option.