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ABSTRACT
Distributed generation (DG) is electric or shaft power generation at or near the site of use as opposed to central power station generation. Combined heat and power (CHP) takes advantage of this site location to recover the normally wasted thermal energy from power generation and utilizes it beneficially to increase the total system efficiency. This article explores the rapidly developing world of DG and associated CHP. First the article shows why DG is necessary in the US power future and that DG is going to happen. Then, the article briefly looks at the different technologies that might be employed and their relative advantages and disadvantages. The article then explores who should be the major designers and implementers of DG and CHP technologies, and develops a strong argument that in many cases this should be an Energy Service Company (ESCO). Finally, the reasons for selecting either an independent ESCO or a local utility affiliated ESCO are discussed, and in particular, opportunities for the local utility ESCO (the local grid) to be a major moving force in this effort are examined in depth.