Two key findings show that meeting future US electricity demand growth through DE instead of central power would, by 2020:Cut CO2 emissions by over 45% compared to central power.
Commenting on the survey, WADE Director Michael Brown said: ‘Optimizing Future Heat & Power Generation’, Tom Casten & Martin Collins, October 2002; available
at www.localpower.org. 
“The ongoing dominance of traditional central power is preventing both developing and
industrialised countries from benefiting from the economic-environment ‘win-win’ which DE
WADE press release 22 October 2002 2
can deliver. Globally, central power generation wastes as much energy as that used by the
entire worldwide transportation sector. This waste is causing substantial social, economic
and environmental damage. Our new survey highlights that the key to reducing this waste
lies with energy policymakers and regulators, in particular those responsible for power sector
reform. The barriers to efficiency can be removed”
One of the most substantial benefits of DE, both high efficiency cogeneration and distributed
renewable energy systems, is that it reduces carbon emissions. The survey indicates that a
doubling of the DE share of global power generation to 14% by 2012 would reduce global
CO2 emissions by more than 720 Mt/year – over 25% of the required cut to achieve Kyoto
The survey identifies six key barriers which recur time and again around the world:
1. Power utility efficiency is not rewarded;
2. Electricity sales to third parties are often illegal;
3. Electricity prices do not reflect overall demand at a particular time;
4. Backup charges are too high;
5. Policymakers ignore transmission and distribution costs;
6. Power sector reform ignores the benefits of DE.
To enable future developmental and environmental objectives to be achieved, policymakers
should address these barriers and ensure:
1. Grid access on fair and transparent term for all DE systems;
2. Market-based rules that encourage greater efficiency of electricity brand heat generation;
3. Full price recognition for the locational value and environmental benefits of DE;
4. Incentives for monopoly electricity companies to reduce fuel use and improve efficiency;
5. The establishment of well-resourced DE promotion organizations in every country.
What is Decentralized Energy?
WADE defines decentralized energy (DE) as the high efficiency production of
electricity (and heating/cooling where possible) near the point of use, irrespective of
size, fuel or technology.
Two key divisions of DE are: