Is small-scale cogeneration right for you?
Aug 19, 2013

Most people look at Cogeneration as a new technology.

But it is neither new nor a technology.  Commonly referred to as Combined Heat and Power (CHP), cogeneration is the utilization of the heat energy produced when generating electricity; heat energy that is normally discarded as waste.  It is a type of distributed generation – taking the heat generated during the actual production of electricity and using it as thermal energy instead of a useless waste by-product like the electric utility does.

Cogeneration isn’t a new idea…

Although the term cogeneration was coined in the 1970s, the concept of capturing the waste heat produced when generating electricity dates back to the nation’s very first commercial power plant – Thomas Edison’s Pearl Street Station. Edison’s power station came online in 1882 and provided both electricity for lighting and steam for local manufacturing; a perfect example of cogeneration.

AUS's Cogeneration - Tradition Vs. Cogen

What types of buildings are suited for small-scale cogeneration?

Cogeneration has primarily been used for large industrial installations that required a constant stream of electricity and heat in order to operate. But the market for small-scale CHP systems is increasing steadily as rising energy prices have business owners and residents scrambling for alternatives.

CHP is typically a good option for nursing homes, hotels, and hospitals due to their constant need for hot water and air conditioning on a 24-7 basis. It is also well-suited for multi-family apartment buildings, carwashes, homes and any building or facility requiring thermal energy. An on-site CHP system can also play a secondary role as a standby generator in case of a power failure.  How’s that for working overtime!

Small-scale CHP systems can be installed in new construction as well as retro-fit applications.  And they are applicable to around 80% of the current stock of U.S. single-family homes, regardless of style.

Primary Benefits of Cogeneration

  • Cogeneration can increase fuel utilization efficiency anywhere from 60% to 92%. Did you know that about 2/3 of the energy required to make electricity in the U.S. never reaches its destination? The average efficiency of power generation in the U.S. is 33% and it has been so since the 1960s. The thermal losses in power plants total about 23 quadrillion BTUs of energy, representing 25% of the total energy consumption in the U.S. This amounts to enough energy to power the nation’s entire transportation fleet!  With cogeneration, you create energy at the point of use, making it far more efficient than the current model used by utilities.
  • The increased efficiency of CHP results in large energy savings. It is not unusual for a CHP system to pay for itself within 2 to 3 years.
  • CHP reduces greenhouse gas emissions. The increased fuel utilization efficiency of CHP requires less fuel than traditionally separate heat and power systems use to produce the same amount of energy.

An example of small-scale cogeneration at North America’s 1st net zero energy hotel…

For an example of the size and scope of a small-scale CHP system, one has only to look to the Green Leaf Inn, which will be using a CHP system burning natural gas to generate electricity. The heat will be captured with circulating water and used for the radiant floor heating, or delivered to the thermal storage tank for later use. This short video explains more about the Inn’s natural gas cogeneration system. Alternative Utility Services is the energy consultant and manager for this CHP project.

There are still many obstacles in the way of developing CHP in the U.S.

Most obstacles are regulatory in nature. Suffice it to say, there exists a tangled web of laws designed primarily to protect the utility monopoly from losing profits by discouraging decentralized power generation, such as cogeneration. They include:

  • A lack of common interconnection protocols
  • Discriminatory standby rates
  • Emissions regulations which fail to acknowledge the improved efficiency levels of CHP systems

There are also several site-specific factors which can determine if CHP is even a viable option for a building or facility’s needs.  As a result of all this, the United States still lags far behind other industrialized nations in the use of CHP.

But there’s hope. In August 2012, President Obama released an executive order for the U.S. to set a goal of achieving 40 gigawatts of new, cost-effective CHP by 2020. Achieving this goal would increase total U.S. CHP capacity by 50% and save energy users $10 billion per year. It would also reduce emissions by 150 million metric tons of carbon dioxide annually.

Where to start?

Find out if your facility is right for cogeneration.

To assess your facility’s energy needs and if it’s right for cogeneration, the first step is working with an energy consultant. Alternative Utility Services (AUS) expertise includes CHP as well as energy management, energy brokering and utility consultation.  AUS president and co-founder, Fritz Kreiss, has over 20 years of expertise in cogeneration systems, including recent certification from the Association of Energy Engineers this July, for course completion in small-scale cogeneration.

An AUS consultant can determine if your facility would benefit from CHP and if so – the type of CHP system you’ll need to receive the best energy savings and ROI.

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