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What, Why and How
The concept of distributed generation relates to generation of power close to the point of consumption. – i.e. local production of electricity. Many different technologies can be used for such electricity generation including fossil fuelled systems as well as systems based upon renewable energy sources. Typical examples of DG are small scale combined heat and power systems using piston engines or gas turbines as prime mover, small wind power plants, photovoltaics, fuel cells and different types of small generating system operating on land fill or sewage gas.. 
The main reason to use DG and thus these different types of systems are one or more of the followIncreased efficiency
- Higher reliability
- Lower emissions
- Less use of scarce primary energy sources
- Lower investment cost
Different technologies and applications have different values.
The values may also be different for different stake holders. Main stake holders are the end users, the energy producing companies, the grid operators, system manufacturers and the society ( represented by policy makers and politicians )
Different attempts have been made to quantify the values of DG. This is quite difficult taken into account the different priorities of the different stake holders. However it can be concluded that all stake holders sees advantages with DG under certain circumstances. These circumstances may be connected to availability of a certain fuel, how good the grid is, the customers load profile or the customers need for reliability.
This variation in valuation of DG is also one reason that there are no standardised rules for installation and use of DG.
The final report of DG-FER which can be downloaded gives more information about value of DG and the barriers to DG.
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