Small is profitable: The Hidden economic benefits of making electrical resources the right size

to quantify any resulting benefits, but their common-sense obviousness may help to win approvals. 2.4.10.7 Conflict avoidance: stakeholders and trust Centralized resources tend to be built by large, bureaucratic institutions that are relatively opaque, slow, and inflexible as seen by outsiders. The impression that such an organization is trying to impose its will on relatively powerless citizens can create a sense of injustice, reaction, and revolt, and this perception in turn can exacerbate resistance to local impacts perceived as relatively large. Distributed resources fit better with stakeholder engagement at a community scale, with flexible siting sensitive to local needs, and with the sense that the enterprise is of a comprehensible scale more likely to prove politically accountable. These attributes can reduce the potential for conflict, and hence can moderate cost, financial risk, and delays in approvals. 2.4.10.8 Health and safety issues: risk and perception Any energy system has health and safety effects. There is a huge literature on them. They range from obvious to subtle, local to global, and immediate to long-delayed. In general—though no doubt exceptions can be found—electrical resources that are distributed and renewable tend to have lower, easier-to-understand, easier-to-measure, and more temporary health and safety impacts than those that are centralized and nonrenewable. This should have an economic value to the extent impacts are internalized, and a political value, which translates into reduced cost and risk, even if they are not internalized, so long as they are at least perceived. It is also noteworthy that giant facilities tend to attract the sort of political and regulatory scrutiny and “ratcheting” feedback described in Section 1.2.3 (Figure 1-8) that can increase unit cost geometrically with the number of units built. Distributed facilities generally avoid this disadvantage. 300 Part Two: BENEFITS OF DISTRIBUTED RESOURCES 2.4 OTHER SOURCES OF VALUE 180 Distributed resources can reduce irreversible resource commitments and their inflexibility. Benefit 181 Distributed resources facilitate local stakeholder engagements and increase the community’s sense of accountability, reducing potential conflict. Benefit 182 Distributed resources generally reduce and simplify public health and safety impacts, especially of the more opaque and lasting kinds. 183 Distributed resources are less liable to the regulatory “ratcheting” feedback that tends to raise unit costs as more plants are built and as they stimulate more public unease. Benefits