Solar Energy is often talked of in the context of other Renewable Energy technologies that also have Distributed Energy Generation potential. Distributed Generation is defined as the generation of energy close to the point of use.  Distributed generation typically ranges from 1 kilowatt to 5 Megawatts in capacity. This contrasts with Central Generation, which is associated with large 500 to 3000 Megawatt generating plants that are usually located at a distance from where the energy is consumed. The electricity is then transported through the transmission and distribution infrastructure to the customer/user.

Distributed generation has these advantages:

•  it can reduce or avoid the necessity to build new transmission/distribution lines or upgrade existing ones
•  it can be configured to meet peak power needs
•  it can diversify the range of energy sources in use and increase the reliability of the grid network
•  it can be configured to provide premium power, when coupled with uninterruptible power supply (UPS)
•  it is well-suited to the use of some renewable energy technologies, because they can be located close to the user and can be installed in small increments to match the load requirement of the customer.

When comparing the costs of different energy sources, an "apples to apples" comparison is not straightforward for the following reasons:

• power stations are major increments of power, which does not easily make for comparison with distributed energy, which is installed in relatively small increments.

• the cost of finance is critical to renewable energy sources. Energy sources that utilize fossil fuels have both upfront costs and ongoing costs (i.e. the cost of purchasing oil, gas), which means that a substantial part of their total costs are spread over time. In contrast, Renewable energy typically incurs a high upfront cost, but sees extremely low ongoing costs. This means that a low cost of finance amortized over the life of the equipment/capital investment can vastly enhance the economics of renewable energy.

• dispatchability has value. If the energy supply is "dispatchable", it means the energy supply is guaranteed or predictable. The more predictable it is, the higher its value. Fossil fuel driven power plants and nuclear power are dispatchable. Renewable energy sources alone are generally not. Therefore to make an "apples to apples' to comparison, the renewable energy sources must be configured with a means of "energy storage" (i.e. batteries or hybrid systems (renewable energy and another energy source)) to create a true comparison.

• fit with load curve. An energy source that produces at the time of high demand (over a 24 hour period) has greater value to both the Utility and the Customer. Periods of peak load are the most expensive time because the Utility has to have that capacity available, yet that same capacity will remain idle during other parts of the day. Solar Energy is a good fit with daily load peaks where summer air conditioning is required and does not need to be "dispatchable" as it can pass surplus power back to the grid during the day, while drawing on the grid at night. This approach maximizes the value, while minimizing the cost of Solar Energy.

• the economics of many renewables are dependent upon location and therefore can vary dramatically. Wind requires certain minimum speeds, solar economics can be optimized in regions of the world with good sunlight conditions. So a single cost per kilowatt hour can be misleading and the answer should be presented in the form of cost ranges.

• continued decline in the cost of distributed energy technologies
• co-operation from Utilities and local Governments firstly to ensure the appropriate physical infrastructure to accept distributed generation in to the electricity grid, and secondly to facilitate the development of reasonable Connection Agreements.

Wind turbines are packaged systems that include the rotor, generator, turbine blades, and drive or coupling device.

The wind turns the blades of a windmill-like machine. The rotating blades turn the shaft to which they are attached. The turning shaft typically either powers a pump or turns a generator which produces electricity.

Selection of a suitable site is key to the economics of wind energy. In general, winds exceeding 5 m/s (11 mph) are required for cost-effective application of small grid-connected wind machines, while windfarms require wind speeds of 6 m/s (13 mph). For applications that are not grid-connected, of course, these requirements may vary, depending on the other power alternatives available and their costs.