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Why Promote CHP?

Why Promote CHP?. Focus on cogenerating electricity and thermal energy on-site CHP uses thermal energy from heat normally wasted in electricity generation Result: energy and environmental benefits Also, potential reliability benefits But: cost and maintenance issues must be addressed.

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Why Promote CHP?

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  1. Why Promote CHP? • Focus on cogenerating electricity and thermal energy on-site • CHP uses thermal energy from heat normally wasted in electricity generation • Result: energy and environmental benefits • Also, potential reliability benefits • But: cost and maintenance issues must be addressed

  2. Factors to Consider • Utility rates • Interconnection standards, fees, processes • Environmental regulations • Applicable taxes • Price forecasts for alternative fuels • Familiarity of facility managers with existing & emerging CHP technology • Incentives to reduce capital cost

  3. Possible Incentives • Education & capacity building • Technical assistance re scoping studies • Project financing • Project incentives • Tax credits

  4. CHP & Utility Rates • Gas utility promotional rates for gas • must apply for off-tariff rate, with justification • Electric utility favorable backup/standby power rates • as discussed

  5. Regional CHP Initiative • Northeast CHP Application Center was established Oct 2003 for US DOE at UMass Amherst and Pace Univ. • Partnership between UMass, Pace, NYSERDA, MA Division of Energy Resources and the Maine State Energy Office • To provide application assistance, technology information, and educational support in the six New England states and New York.

  6. CHP Incentives, continued • Source of Incentives • Gas utility ratepayers • Electric utility ratepayers • Taxpayers • OTHER? • Delivery of Incentives • State agency • Gas utility • Electric utility • OTHER?

  7. Example Program -- MA • Massachusetts gas utilities • Technical assistance • eg Bay State Gas, 50% of cost for engineer for scoping study, up to $7500 • Plus existing DSM incentives only • eg incentive for more efficient boiler • Above are permitted within gas DSM despite load-building effect

  8. Example Program -- NJ • Office of Clean Energy CHP incentives • CHP system must be at least 60% efficient • Add-on generation capability -- $0.50/W, up to 30% of project cost • New microturbine/ICE/gas turbine based -- $1/W, up to 30% of project cost • W. space cooling, up to 40% of project cost • Fuel cell based -- $2.50/W, up to 40% of cost

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