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Distributed Energy Resources: Combined Heat and Power in Oregon

Distributed Energy Resources: Combined Heat and Power in Oregon. Agenda. Oregon Office of Energy Role and Objectives Combined Heat And Power (CHP) Policy Issues Why CHP in Oregon? Oregon Distributed Energy Resources - CHP Oregon Incentives for High Efficiency CHP

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Distributed Energy Resources: Combined Heat and Power in Oregon

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  1. Distributed Energy Resources: Combined Heat and Power in Oregon

  2. Agenda • Oregon Office of Energy Role and Objectives • Combined Heat And Power (CHP) Policy Issues • Why CHP in Oregon? • Oregon Distributed Energy Resources - CHP • Oregon Incentives for High Efficiency CHP • History of Involvement and Other Resources

  3. Mission The mission of the Oregon Office of Energy is to protect Oregon’s environment by saving energy, developing clean new energy resources and cleaning up nuclear waste. Benchmark Carbon dioxide emissions from burning fossil fuels are reduced 1 percent per year.

  4. Objectives and Services Objectives • Effective Efficiency Policy: Transportation, Homes & Business • Nuclear Safety: Facilities Cleaned Up and Safe Transportation • Clean New Energy Facilities Siting: C02 Compliant Power Plants • Conservation and renewables meet a significant portion new needs Services • Research and Policy Development • Technical and Financial Assistance • Project Financing: $30,000 to $30,000,000 • Tax Incentives • Expert Referral To Other Services

  5. Combined Heat and Power Issues Policy • Model zoning code for systems under 25 megawatts • Interconnection standards adopted and recognized • Increase net metering capacity • Model utility agreements Marketplace • Informed engineering community • Informed jurisdictions • Stock plans and performance expectations for consumers • Technology available and affordable

  6. Why Combined Heat and Power in Oregon? Electricity Demand Up • Demand up 15% from 1990 to 1999 • Two decades of population growth above national average • Economic recovery will increase demand Electricity Supply Down • Columbia runoff for Jan 01 to Jul 01 is 68% of normal • Second worst drought in NW history forecast • Salmon-saving efforts • Grand Coulee Reservoir is lowest ever Regional Mix Heavily Hydro • Hydro - 66% • Coal - 21% • Natural - Gas 9% • Other - 4% (oil, nuclear, renewables)

  7. Why Combined Heat and Power in Oregon? • Boosts local electricity supply capacity • Can improve power reliability • Reduces system and site peak loads • Avoids transmission and distribution capacity costs • Reduces transmission and distribution line losses • Overall system efficiency increase • Reduced emissions to environment possible • On-site power quality control

  8. Oregon Distributed Energy Resources - CHP • Systems over 25 megawatts require energy facility siting • Most Oregon DR is at industrial sites and over a megawatt • Most fractional Megawatt DR is emergency or UPS generation • Renewable and fuel cells under 25 kilowatts enjoy net metering • Baseline generators up to a megawatt quite rare • No model zoning or permitting process for under 25 megawatts • Utility interconnect agreements vary and negotiated individually

  9. Oregon Distributed Energy Resources - CHP • 38 distributed generation plants over a half megawatt (mW) • Does not include emergency generators or others under .5 mW • .5 to 51 mW capacity range • 497 megawatts total installed DR capacity • 80 Megawatts of that capacity idle • 20 biomass or black liquor fired • 12 natural gas fired • Two waste water gas • Landfill gas operated as central power not included • Oldest operating built in 1955, most recent finished in 2002

  10. Oregon Incentives For CHP • Financing • Fixed rate loans available for entire cost • Fixed terms of five, ten or fifteen years Tax Credits (Tiered) • Heat recovery costs for systems 6,200 Btu/kWh or lower 10 % better than Oregon Carbon Standard • Full cost eligible for systems at or lower than 5,700 Btu/kWh 60% overall system Efficiency Technical Assistance • Engineering, policy and research help

  11. Financing • Small-Scale Energy Loan Program • $280 million dollar portfolio • Energy efficiency, renewable resource, recycling, heat recovery • Fixed rates of 6.5 and 8% • Fixed term financing at five, ten or fifteen years • General obligation bonds A+ rated • Public projects and renewable resource tax exempt bond rates

  12. Incentives For Efficiency Businesses

  13. Tax Incentives • Business Energy Tax Credit • 4,500 completed projects • $720 million dollars in projects since 1980 • Energy efficiency, recycling, transportation, renewable resources • 35% credit against State of Oregon excise taxes owed • $1,000,000 project = $350,000 credit against taxes owed • Project pre-certification (approval) in 10 business days

  14. Incentives For Efficiency Industry

  15. Tax Incentives • Residential Alternative • Energy Device Tax Credit • Up to $1,500 tax credit available • Renewable resources - solar, wind, geothermal and micro-hydro • Premium efficiency appliances -washers, dishwashers • Hybrid-electric and alternative fuel vehicles • High efficiency heating ventilating and air conditioning • Fuel cells

  16. Incentives For Efficiency Residential • Most Efficient Appliances • Efficient HVAC • Solar, Wind, Geothermal • Fuel Cell Incentives

  17. Incentives For Efficiency • Transit Passes • Telework Transportation • Hybrid -Electric Vehicles • Clean Burning Fuels

  18. History of Oregon Efficiency Incentives and Services • 1979: Small Scale Energy Loan Program • 1980: Business Energy Tax Credit • 1981: Residential Alternative Energy Device Tax Credit • 1983: Building Codes For Commercial and Residential Buildings • 1985: Property tax exemption for renewable resources • 1988: Industrial Assessment Center • 1996: Oregon Manufacturing Extension Program • 1999: Net metering legislation • 1999: Electric utility restructuring

  19. Other Related Oregon Activities • Global Warming !! • 1988: Governor’s task force • 1991: Oregon directs CO2 reduction • 1992: Benchmark for CO2 established • 1995: Oregon CO2 reduction strategy • 1997: Oregon power plant carbon standard • 1999: Global warming education campaign • 2000: Governors sustainability executive order

  20. Other Oregon CHP Resources • Utilities • Technical assistance • Net metering for CHP, fuel cells or renewables • Some financial assistance Industry • Experienced engineering community • Oregon manufacturers of fuel cells, reformers, and CHP • Local suppliers of fuel cells, microturbine, and IC engines • 200 Market Street Consortium

  21. Other Oregon CHP Resources • Oregon State University Industrial Assessment Center • Oregon Manufacturing Extension Partnership • Oregon Department of Environmental Quality • Bonneville Power Administration and Public Utilities • U.S. Department of Energy • Industry Associations • Technology Roadmaps • NW Natural • Pacific Power • Portland General Electric • Idaho Power

  22. Observations • Based on Oregon’s experience, we can limit CO2 emissions without harming our economy. • Education, technical assistance, standards and incentives are key. • Renewable resources are most beneficial resources. • Marketplaces can provide competition for best value. http://www.energy.state.or.us

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