The energy industry resembles a very fragmented landscape with distinct participants leading in specific sectors and a stable of varied interests competing in others.

A mix of regulatory and business conditions both within and outside of the traditional utility structure has fueled the emerging independent power production market. An important distinction should be made between the "merchant" independent power producer and the developer of distributed generation assets. The developer of merchant power facilities gambles on the widespread need and demand for electricity and therefore speculatively builds a large centrally-located facility to supply a certain region. The developer of distributed generation assets operates by developing facilities for which there are long-term (15-20 year) purchase agreements from an industrial client, and can enjoy both the security of a guaranteed return as well as the potential upside of excess supply sold into the market.

The merchant power facility developer, with a few exceptions, is a risk taker that leverages each development to the tune of hundreds of millions of dollars in the hopes that the market demand will ultimately provide satisfactory ROI. The developer of distributed generation facilities focuses typically on smaller projects that always have an industrial or commercial anchor client whose long-term power purchase agreement secures a level of return on the project. The DG developer and the market they operate in continue to be comparatively inefficient.

Many of the groups developing these "inside-the-fence" distributed generation facilities are small 3-5 person operations that originate from a relationship with the industrial client. To date, the companies or small groups engaged in developing small "inside-the-fence" distributed generation facilities were perceived as "mom & pop" businesses that were operating in a space within the industry that was much less exciting or high profile as the large energy service providers. This characteristic of inefficiency predominates this particular area of the industry.