Combined Heat and Power (CHP) technology is not new – it’s been applied by utilities going back to the days of Thomas Edison. At a utility’s scale it makes so much sense to recapture huge waste heat loads generated during electricity production and apply this energy to a system like a district steam loop for heating within a campus or city.
“Mini” CHP, the type we install at a commercial facility level, is showing signs as having an equally attractive financial and environmental impact. Like utility systems these smaller systems (75kW to 1 MW) produce electricity and heat, typically all consumed at the site, with the heat being applied to domestic hot water or process hot water/steam production.
The basic efficiencies are pretty striking – take a 30% efficient process of burning fuel to generate electricity and make it 85% efficient by capturing and using the waste heat. Our typical economic analysis revolves around the initial system cost, net of incentives, and it’s cost to operate (principally fuel) vs. our customer’s cost of utility delivered electricity and their cost of heat.
Like any asset, the math is best when the CHP system is fully utilized, meaning a facility has a constant use for both the electricity AND the heat. Regardless of whether the system is based on a natural gas powered engine, fuel cell, micro turbine or today’s more green and sexy biomass CHP system, the challenge with these systems remains sizing the system to the largest possible heat load that can be consumed year round at that facility. Economies of scale are the issue here.
Not surprisingly, there are certain types of commercial facilities where this can work extremely well – apartments, hospitals, hotels, manufacturing, nursing homes and universities. So when studying CHP, just remember, if you can use the heat, you might have a good opportunity….
If you’re interested, we’re going to be presenting some of the basics issues around CHP and the latest trends we’re seeing during our upcoming webinar with GreentechMedia.