Distributed generation allows energy to be generated close to the point of use, giving customers choice in their energy sources. Customers can generate their own power and sell excess back to utilities, representing a new relationship. Hybrid systems combine renewable sources like solar and wind with traditional energy. Within a smart grid, utilities can access distributed generation to meet peak needs and increase reliability through diversified energy resources. For customers, distributed generation supports lower costs, reduced fossil fuel reliance, and more renewable use.