HACKER Q&A
📣 tareqak

How can I start a business to generate electricity?


I know that the capital costs for building a working power plant of any kind are pretty high. However, I still want to learn and see what is possible.

1. What is the thinnest vertical slice of end-to-end power-generation functionality that an individual would be able deploy and maintain on their own?

2. What are the names of necessary things that I would need to learn and research?

3. What parts are too easy to dismiss early on, but are likely to bite me later on?


  👤 WJW Accepted Answer ✓
I don't want to be discouraging but if this is the level you are at right now, "deploy and maintain on your own" is very likely to get you electrocuted. Grid level electricity generation is not something to "move fast and break things" with.

That said, get acquainted with:

- How the electrical grid works. You will at the least want to have a working understanding on how generators synchronize to produce a coherent grid and how frequency regulation works. You should be able to at least immediately tell the difference between a MW and a MVAR, or to clearly explain the impact of power factor correction on transmission line capacity.

- The various different primary energy sources (fossil fuels, nuclear, wind, solar) and how they differ.

- Your local electricity grid regulator will have published rules for the local wholesale electricity market. Learn those and how to interact with them. You should probably be aware that for most markets the minimum bid size is in the order of megawatts, which is enough for about a thousand homes.

- The economics of how power generation works. Power generation has massive economies of scale and single-person initiatives are unlikely to be able to compete.

- Last but certainly not least, get yourself up to date with safety regulations. Grid level electricity will not only kill you, it will hurt the entire time too.

If you want to "just" make enough electricity for yourself, get some solar panels on your roof. I'm sorry this post is probably not what you were hoping for but electricity is really really dangerous and not something you should be going into if you don't have a firm grasp of what you are doing.


👤 qbasic_forever
Put solar panels on your roof and contact your energy company so they can be hooked up to provide power onto the grid and give you energy credits. Not every area allows this but from what I understand some folks make money in the summer and then that offsets the costs they spend pulling power from the grid in the winter.

You really need to do a lot of research to figure out if it's feasible and if you have enough sunlight, area for panels, etc. to make it worthwhile. There's a lot of upfront costs too with the panels, meters, and extra protections necessary for when you're interfacing with sending power onto the grid--a lot of folks need to run their system for 5-10 years or more before it breaks even and starts making them money vs. all the initial costs.


👤 bloudermilk
The last thing I want to do is discourage anyone from learning, but I'm afraid you're looking at this (fascinating) field the wrong way. To the extent that this is unlikely to be an interesting intellectual pursuit for you, as it's currently framed.

If you really do want to operate a business generating electricity, start by learning how the power market operates in your area. Unless you live off-grid with a high degree of autonomy, you're likely to find that there are zero opportunities for an individual to enter this market on their own. Providing stable power to the grid requires unbelievable amounts of capital, planning, compliance, person-hours, and way too many other elements to list here.

If what you're actually interested in is generating electricity for yourself or your community, the good news is this is much more approachable. Developing and operating small-scale off-grid renewable energy system for a small home is achievable with off-the-shelf components and a basic understanding of electronics. You'll still want an electrician to validate and perhaps perform some of the work, but it's all pretty basic.

If what you're actually interested in is spearheading a renewable energy campaign for a large community currently dependent on other forms of power, take a look at community solar programs and energy cooperatives. Both are in practice all over the US.


👤 chomp
1. Depends on where you live. In the Houston area, it’s any power generation from 0 to 10MW for connecting to Centerpoint. You can generate (solar) from your home. As you approach larger numbers (like say 20 - 30 kilowatts) is going to require special design because you’ll push the limits of a single meter. The cheapest and easiest way to get started is to just offset your home usage with solar.

2. There is a tariff for interconnection, and you need anti islanding. Inspections are backlogged by 6-12 months in the area. You’ll need an electrician to draw up the plans for submission to Centerpoint.

3. Even though Texas’s power market is famously “unregulated”, it’s still very regulated. I recommend starting here: https://www.ercot.com/services/training/courses/details?name...

ERCOT has a wealth of information available so that you can get up to speed.


👤 alfl
I tried this. As other commenters have pointed out the big challenge is regulatory.

That said, my approach was to find businesses or individuals as near as possible to a given piece of land (a lot I own) and see if they would buy power directly from me. I also contacted the local utility provider (as other commenters suggest) to see if I could sell them power or lease them equipment or land.

The idea was something like: find a large power consumer nearby - someone heating a hot tub, running a woodworking shop, data centre, whatever; undercut the local utility, see what the payback period would be on the capital equipment, then get a legal consult on how to paper it, then hire electricians to hook it all up.

tldr I suggest validating the market first.


👤 colechristensen
> What is the thinnest vertical slice of end-to-end power-generation functionality that an individual would be able deploy and maintain on their own?

Becoming a solar installer and engaging in some kind of revenue sharing or a loan kind of structure for getting residential or commercial customers in on it.

Building solar powered vehicle charging stations.

Building backup generation facilities for things like data centers or hospitals.


👤 contingencies
AC power is very different to DC power. A great deal of the efficiency loss and cost associated with small-scale renewable power is in DC-AC conversion, grid connectivity and associated regulatory concerns. Third party professional installations for house-type solar will bundle all of this and be expensive.

More progressive installations and new builds can just go 100% DC and drop the AC and the grid entirely. Whether this is appropriate is case-dependent. It's easier if you cook, shower and heat with gas. This obviously restricts internal design decisions but is totally possible, provides better results, greatly reduces regulatory overheads and safety concerns and is closer to what we see on cruising yachts which often have combinations of wind generation, solar generation and propeller-based generation.

Another concern is energy storage methodology. If you are building a new site you can consider interesting storage technologies such as buried flywheels vs. batteries. Some of these techniques will cost more up front but function far longer with far less maintenance. Fossil-fuel based generators are a good backup option. You really need to profile the loads in terms of peak and continuous draw plus cycle time and frequency before specifying storage.

Note that distribution cabling is expensive. Both copper and aluminium are going up in price and even at wholesale rates here in China heavier gauge copper cable is USD$1.5/meter or so (bare). Cheaper aluminium cables cost about 25% of that but Al is brittle and develops resistance over time owing to surface oxidation, contributing to the probability of delayed failures.

You could start with reading your national electrical code and national building code to understand the installation applicable regulations.


👤 tomrod
In regards to (2), names of necessary things on the ecosystem

If you are an an electric deregulated market:

- Utility commission (PUC, etc.). They will typically have a lot of sway in your day to day.

- Retail Electric Providers: companies that operate as hedge funds and try to buy from you cheaply and sell to customers on a spread

- Aggregators: aggregate customers that purchase energy as a bloc

- Transmission & Distribution: the wires folks

- Power market: your area will vary, but this is an open market where you can sell. Typically you'll sell forward or futures contracts of a sort. There is often a day-ahead market and a real time market as well to help plug any gaps. A power provider that can spin up quickly does well here. Someone with a bunch of airplane turbines can also help here when supply > demand if they wire their turbines up (turbine = generators, backwards). There is a lot of creative financial focus in this space since the returns are more apparent than in power generation


👤 uberman
The first thing you will need is a suitable tie in to the commercial grid. This large overhead powerlines.

Without it that access, you are likely going nowhere even with a small commercial solar farm.


👤 ggm
Start by doing an electrical engineering degree, or commerce law, or take the trade route in to power engineering from the apprenticeship level up.

Think about the supply chain. Is there a consumable which you could source and supply at better margin and lower cost? Is there a niche in replacement china insulation pots for the posts and wires? Can you make a better self tensioning high current wire connector?

Think about software. Is there a gap on demand management, software for power monitoring, weather prediction.

Do you know enough about it, to take baby steps?


👤 dzink
Viable business plan: Buy an abandoned strip mall in the south. Cover it with solar panels. Use the energy to fill portable batteries. Provide a EV charging service or subscription on wheels for Tesla owners or other EVs who are struggling to find charging spots or superchargers nearby. Raleigh NC, Charleston SC, etc are possible test spots and anywhere else EV infrastructure is not going on full swing.

👤 pomian
I think the first question, as mentioned, in one of the previous comments, is your location. There are many opportunities in smaller, distant communities that don't have grid service, or don't have good, grid service. Those are places that have room for ideas and opportunities, hence business feasibility. Things like small river turbines, or other combined power sources, possibly wind and solar, even fuel generators as back up. The systems are not really complicated, depending on the end user. Obviously you are not trying to compete with the city of Austin or Dallas, Texas. But tiny remote villages, need electricity. Start small, and as with most successful business, then grow. Find a niche. Then expand when you see the need or opportunity. In the beginning, people without power, are happy to charge cell phones, or power a well pump. Great idea!

👤 AdamH12113
Serious question: Why do you want to start a business making electricity if you don’t know anything about power generation? “Business” implies you want to make money, so what are you bringing to the table that would help you turn a profit? Capital? Land? Friends in high places? Why electricity and not something else?

👤 liketochill
1. Find someone who wants to buy electricity. Seriously what grid operator has open offers for proposals to connect new generation, on any scale? Start there.

2. Find land that works for building your plant. It should be near existing transmission or distribution infrastructure so you don’t have to build as much yourself, which is expensive, and it should have good road access already, so you don’t have to build as much yourself, which is expensive.

3. Get a connection study done by the utility which proves it is possible for them to accept the energy at the location you want to build your plant

4. Sign contract to sell your energy

4. Get environmental studies done to prove you won’t harm birds fish insects etc

5. Get financing and insurance

6. Contract out design and construction of your plant. Probably operation too.

The technical side is the easy part. Getting the contracts and permits in place is harder.


👤 brudgers
The thinnest slice is remote power systems for off grid locations at the scale of a few solar panels, a small generator, a wind turbine, or hydroelectric…in order of increasing regulatory hurdles and real estate acquisition.

Under capitalization is most likely to bite you. That’s true of all business.

Good luck.


👤 tuatoru
The thinnest slice of ... end to end...? Maintainable by one person?

Something like a microcontroller based remote weather sensing node, or a garden night-light, powered by a 1-watt PV panel. That has generation, transmission, conversion, storage and end use all in one package. End to end. Very thin. Maintainable by an individual.

A business? Hire a registered electrical engineer who specialized in Power Systems Engineering. Likely, you'll need several, because of the sub-specialties. Lawyers too. This is not 1887. We have a lot of laws about consumer and third-party safety now.

If you just want to learn about generation and distribution, get an EE degree specialising in Power Systems.


👤 trcarney
I think the best way to start a business generating electricity is to start a business making individual businesses, buildings, and homes more self-sufficient with their electricity needs based on their surroundings rather than thinking in terms of power plants. For example, if the building is near a river, using the river to spin a generator or using windmills in high wind areas, etc. There was actually a pretty cool example of this on the show Dirty Jobs. A guy harvested methane from his animal's poop to power parts of his farm.

To answer your questions.

1. Create your own vertical based on your surroundings. There are really only two ways we currently make electricity, spinning a turbine which then spins a generator, and photovoltaics.

A generator can be made from an electric motor. Figure out how to spin your generator and you are making electricity, or buy some solar panels.

2. Be familiar with Maxwell's equations (these equations explain how both generators and electric motors work), how to read and understand loss charts for wiring, College level circuits, and most importantly safety.

3. Learn basic electrical safety and high voltage electrical safety. High voltage safety is different because of the potential for arcing and it can "grab" you.


👤 perlgeek
> 3. What parts are too easy to dismiss early on, but are likely to bite me later on?

Regulation. (Highly depends on where you live, though).


👤 DoreenMichele
Some thoughts from some random internet stranger:

1. Connectivity is an issue that isn't power generation per se but a potential business opportunity. From what I gather, the power grid would be more stable if we had better connectivity and the isolation of Texas from other parts of the US has been a factor in some of their issues of late.

2. Electricity generation is very much an environmental issue. Regulation is a big thing generally, but environmental regulation is something likely to bit you at some point. If you can do something that is so high quality in that regard that it is likely to exceed any standards that may be instituted in the near future, you would have an edge on competitors.

3. Energy storage is a big issue. We are moving towards solar and wind, both of which put out energy but don't create stored energy, unlike historical hydro which dammed up water and thus created a store of potential energy that could be adjusted at times.

4. Both solar and wind are variable in their ability to produce energy. Wind power has the issue that when a big storm comes, they may need to shut things down to prevent damage to the system and cannot handle the potential big influx of power the high winds represent. We are apparently failing to capture a lot of value in that regard.

5. Wind and solar tend to be complementary but I don't know how often they get packaged together for off-grid applications. It's common for it to be windier than usual when the sun is not available (during storms, shortly after dark).

I think there is lots of ways you could create new businesses related to energy. I encourage you to find some means to just start reading, come up with your own ideas of where some of our energy generation pain points are and go from there.

People tend to do more of the same old, same old. If you find some new angle, keep it quiet until you get traction etc, you can potentially make a mint and also go down in history as some kind of hero for solving this. We currently do a lot of hand-wringing about how there are too many people, there are not enough resources to support them, we are doomed, we need to stop consuming so much electricity, etc ad nauseum.

Best of luck.


👤 alfl
A condo building I know of runs a bioreactor / waste water compost. They sell heat to a nearby hotel (ie, warm their water off-site) and fertilizer (IIRC). Not electricity, but heat and chemical energy.

👤 loxias
Ignore the haters. Spend a few thousand bucks on some used PV panels on ebay, get a bunch of used batteries, and teach yourself enough electronics to DIY build everything else. That'll take you a bit of time, but you'll learn a TON and it's fun.

It'll be a while before you get to the point where you can safely hook up to the grid "DIY", so don't do that. As other posts have mentioned, how the national grid works is fascinating and non-trivial. (I love knowing that stuff, just because I'm a dork)


👤 qwertyuiop_
An MVP would be a Honda diesel generator which powers your home when the wind farms stop working.

👤 darksaints
By yourself, with most common generation technologies, you don't have much of a chance. Current technologies are almost entirely a capital allocation problem, and small producers are not a reasonable solution.

However, if you can conceivably generate emissions-free power on-demand at a cost lower than what they're paying now, you will likely have hundreds of companies knocking your door down trying to help fund your scale out.


👤 vivegi
I am assuming you are not constrained to be a powergrid-connected power plant that is sending power to the grid.

In that sense, a minimal self-contained idea might be to build a charging station. You can build one using solar charging, battery storage and with grid power backup, for example, from first principles.

The solar + battery storage part of the charging station is the power plant and you can build that with existing tech components.

If you are focused on the business aspect of it more than the tech, you can instead focus on becoming an operator by choosing tech (charging stations) that is already available off-the-shelf and instead build a charging network (in a specific geography or market such as residential/apartments/parking lots).

To answer your question on the parts that are easy to dismiss: Focus on the business context, technology, organization, people and process questions. Each of these has a lot of problems and opportunities that you can uniquely choose to address with your company/initiative.

Good luck.


👤 novantadue
The Bitcoin miner space is a good place to look for articles; they are always looking for cheap/profitable electricity generation.

👤 DIARRHEA_xd
You speak like a code monkey, so your best bet is not building your own generation facility, but managing others'. Renewable asset managers design algorithms that control the charge/discharge of storage connected to renewable generators in order to maximize profit.

👤 lynx09
You could recycle alternators and possibly electric car motors to create wind turbines and do housing installations. You can search for a junkyard for some of the materials. You can fill a niche and make a lot of money out of it. Solar installation is expensive. I’m clearly not an expert. Here’s some links…

https://windexchange.energy.gov/small-wind-guidebook#certifi...

https://www.windynation.com/jzv/inf/all-about-delco-style-al...


👤 hadlock
I found a piece of land in north carolina adjoining a substation that's capable of 1mw, looking for a partner to build a solar plant. State has resources for permitting and planning these things. Probably(?) a ok source of long term passive income

👤 fourjawchuck
Others have mentioned solar and getting your own home running on that which I think is a good first step.

Then understanding battery storage for the solar and integrating this.

You should become licensed to do all of this or be prepared to build a business that employs people to do so.

Next would be to build a solar grid in your yard or buy some land to build on. Then offer to sell it at below market rates to neighbors and integrate your solar grid into their homes.

The end goal being something analogous to a WISP which you could continue to add on to as capital and experience permits.

https://www.wispa.org/what_is_a_wisp.php


👤 jmarbach
Try this 25 kw gasifier to create electricity from biomass. It’s about the size of a pallet and can fit in your garage.

https://www.allpowerlabs.com/


👤 timtzm
Have a look at zolaelectric.com. They sell small modular solar pv + battery power units. These units are meant to be purchased by businesses (micro-generators) who then sell the power generated to their subscribers.

👤 CyanLite2
The regulations here are prohibitively expensive.

Your state probably has a public service commission that won't allow you to compete with the local power company. Competition in the utilities business is illegal.


👤 xor99
Start with Youtube, in particular people who describe how to actually build various energy related technologies from wholesale materials. For example Robert Murray-Smith. I would stay away from tech analysis types who just overhype a particular "cool" technology.

Beyond that is extremely costly (capital, labour, time etc). You could look at solar farms or low profile wind energy installs though (e.g. look at improving the wind-type TENGs).


👤 woah
Does it make sense to look at producing a power hungry product and selling it as a way to sidestep all the bureaucracy and monopolies in the public utility space?

Or perhaps it would make more sense to colocate with someone already producing such a product and selling them electricity so that you don't actually have to deal with making the product yourself?

I'm thinking aluminum, hydrogen, synthetic hydrocarbons, etc.

I'm completely uninformed, correct me if this is a stupid idea.


👤 mikewarot
>What is the thinnest vertical slice of end-to-end power-generation functionality that an individual would be able deploy and maintain on their own?

None, you'll want to have an accountant and a lawyer and incorporate your business before you begin to approach your states Public Utility Commission.

Your best bet is taking over an existing hydro-dam, but there are VERY good reasons people don't want to own them.


👤 landryraccoon
What's the problem you're trying to solve?

It's perfectly fine as an outsider to try to break into an unfamiliar industry, even a mature one. But what is it exactly you want to accomplish?

Electrical power generation is a mature industry. So what's the problem with the industry you think you can fix? What's your idea for something that isn't already being done?


👤 bombcar
Buy one that’s already generating. Utilities would love to offload power plants on you. For reasons. Which will probably bankrupt you.

👤 noipv4
Buy a lot of solar panel. Buy some Tesla powerwalls.

Get enough amps from / to the grid.

(check out electricity infra. posts made by crypto miners)

https://insideevs.com/news/606725/tesla-powerwall-owners-sel...

Be your own tiny power company.


👤 quickthrower2
I would think going off grid might be a first step. Be your own customer! You would either need to train as an electrician yourself or hire one. Then get solar, batteries, backup generator and so on. Might mean a move to the suburbs or rural so you completely own the land.

👤 dpierce9
If you are in the US, read FERC Order 2222. Seriously.

https://www.ferc.gov/sites/default/files/2020-09/E-1_0.pdf


👤 miki_tyler
What about infrastructure around Virtual Plants, with either dedicated Software or Hardware?

👤 Raptor22
Are you planning on bidding on the Puerto Rico generation privatization contract? Because you fit right in with the clowns at Luma Energy.

👤 nathanaldensr
What does "end to end" mean?

👤 rr808
Get involved in nuclear fusion. https://news.ycombinator.com/item?id=32620868

👤 6510
become a landlord, buy solar & batteries.

👤 daniel-cussen
You know what I sunk in on recently? The whole thing about "efficiency" is really "use less copper" which is really "negreate Chile out of its rightful money". And in fact the main uses of copper during the 19th century were telegraphs and copper hulls, and then in the 20th century power lines and telephone lines, electrification and communication. But always, always, these guys wanted to use less and less copper. Like nothing. Substitute for aluminum! Yeah.

So what happened in the late 60's early 70's when OPEC, the copper predecessor of petroleum OPEP, in English called OPEC, was successfully cornering the market on copper. And people went apeshit! Like USG said no more pennies because people were melting down pennies. Melt value it's called in currencies. So that's when they substituted with zinc for the inside of the penny--still a bad deal these days because you still need a layer of copper on the shell of the penny, that's a money loser for USG. Speaking neutrally in this case, USG is a neutral term even the US Embassy to Russia uses on its website. United States Government. Anyway. Like USG can lose some money but they can't blow money especially not in the direction of an antagonistic Marxist democratic winner president. So...the pennies got hollowed out--and again those pennies are worth 5¢ still, bad deal, just not a terrible deal like it was before. Could have been worth a quarter, fucks up the whole system.

There is a system. System doesn't want to talk about there being a system, but there's a system. And it needs integrity, which I like to give it, because when there is no integrity all Hell breaks loose.

So that's one way you could win. Do away with all that flamboyant high-voltage shit and do voltages humans can tolerate, like household voltages, just using a lot more copper. Lots more. Take the USG out of your equation, buy copper, hey it's a precious metal, it's an exotic metal, you're clearly not politically aligned with negreating Chile, Peru, Zambia, Zimbabwe, Arizona, and Mexico right? And copper in your wires is a great investment. Copper hasn't had a bull run in ages. Again, very niggardly buyers who through golps of state (coups d'etat), highly negreated commodity. Very political. In fact for copper wire thickness it's not an optimum to use the thin wires they use out there, it's calculated based on interest rates and metal prices, and then there's the political layer. Get wires as thick as whale-hunting rope, six inches diameter, go for it. More efficient at every voltage, can use lower voltage, less liability insurance, go for it. Electricity can't leak onto more copper.

There's caveats. Although you should also do your own experiments to verify, don't get everything from a single pipe because then you're destined to suck it. That goes for electricity generation as well, you can give people options, maybe jump in during a disaster, when too-efficient (not effective) power generators go offline.

And study up. Be an autodidact if you wish, but be solid. Work through like three books, working out all the exercises, with only minor gaps.

OK so you get one of those books from an Elmer, which is a common baby name in the 1890's I think, meaning an old-timer who's seen all kinds of shit. All kinds. And in addition to all that shit of all kinds, seen a lot of the same shit over and over. In Japan people respect this level of repetition, in America no you gotta be a movie star and always do radically different stuff in a single respectable line of business perpertually...forget the American. So in Japan a sushi apprentice must cook rice for ten years before he gets promoted to a chef. That has worth! You end up knowing the rice so perfectly...every detail, the times, the temps, the water, the purity of the water, tap water or non-effed-up water (F'ing as in F the letter for Fluorine). Like I just tried cooking rice and fucked up hardcore, it burned into the pot, because I didn't know the bottom of the rice had charred while the top was soggy.

So get that Elmer.

And then, read those books. And then you know what why don't you verify experiments, read about Tesla's experiments verify them, there's shit going on there, there's political stuff reaching into the physics, it's not flat physics. Know that a friend whose judgment is ground truth said Newton's physics formulae didn't check out. Like at all.

Maybe we're in a Riemann geometry insofar as the laws of spacetime physics.

But in the meantime, be very very independent, find beauty is simply and solely how little resistance there is to verification.

And start strong, get worn out, struggle to death. Then you'll get a second chance.