Curbing Energy Sprawl with Microgrids

Energy sprawl—the phenomenon of ever-increasing consumption of land, particularly in rural areas, required to site energy generation facilities—is a real and growing problem. Over the next twenty years, at least sixty-seven million acres of land will have been developed for energy projects, destroying wildlife habitats and fragmenting landscapes. According to one influential report, even renewable energy projects—especially large-scale projects that require large-scale transmission and distribution infrastructure—contribute to energy sprawl. This Article does not aim to stop large-scale renewable energy projects or even argue that policymakers should focus solely on land use in determining whether energy projects are allowed to proceed. Rather, it proposes that we advance the legal institutions necessary to facilitate one possible solution to energy sprawl: the alternative energy microgrid—that is, small-scale distributed generation between neighbors of energy derived from sources such as solar collectors, wind power systems, microturbines, geothermal wells, and fuel cells. Microgrids are attractive from a public policy perspective. They decentralize energy production, reducing the need for massive transmission lines and large centralized plants. They allow property owners to achieve economies of scale by spreading the costs and the risk of installation and maintenance among many parties. They provide cleaner alternatives to conventional energy methods of production. And they improve system efficiencies by reducing the amount of energy lost during transmission across long distances to end users. Despite such benefits, regulatory, political, and economic barriers thwart microgrids. For example, state laws prohibit or severely limit their viability, while neighbors may object to living nearby. This Article offers three proposals to address such barriers. First, Congress should require states to consider a model standard for microgrids, just as it has required states to consider model standards in other areas of utility law. Second, states should provide guidance to localities with respect to siting and permitting microgrid projects. Third, states should develop and authorize legal institutions that would support microgrid projects, drawing from Professor Robert Ellickson’s proposal for block improvement districts, which accommodate the public-private nature of shared energy. Together, these proposals would support small-scale energy sharing collectives whose emergence could transform the American landscape