A Comparison of Fuel Choice for Backup Generators

The costs of a power outage to a business can be substantial, including losses in product, revenue, productivity, and customers. With increasing severe weather events and disasters triggering greater numbers of costly power outages, there is a growing interest in generators for reliable backup power.

This report discusses the costs and benefits of backup generator configurations. The report analyzes the relative costs and benefits—in terms of economics and reliability—of natural gas backup generators versus diesel as fuels for backup systems. It also compare the relative merits of grid-connected backup systems that enable financial benefits when the grid is functioning, versus backup-only systems that only generate energy for critical services when the primary grid is down. 

We discuss how to assign value to the reliability of each system and the revenue streams related to backup generators. To provide concrete examples, we model diesel and natural gas backup generators and systems installed at supermarkets located in Houston, Texas; Camden, N.J; and Orlando.

Download the new report from the Joint Institute for Strategic Energy Analysis that explores findings that present natural gas as providing the largest additional reliability compared to diesel for regions that face high risks of long outages.