Challenges to implementing distributed generation in area electric power system

Nowadays, electricity is mainly produced by large central generation plants. However, generators with lower capacities are increasingly used for distributed generation (DG). Distributed generators are applicable for improving supply reliability with considerations of renewable energy, environmental protection, peak load shaving and deferred investments in network expansion. Comparing to central generation, DG technologies are flexible in size, fuel, operation and expandability. Most of DGs are installed at distribution level. Various kinds of loads as well as active compensation devices may be connected in parallel with DG. Moreover, low capacity generation systems are more susceptible to power quality issues. This paper presents challenges of implementation of DG in practical area electric power systems under the impacts from both utility side and demand side.