Thursday, October 11, 2012

“CHP” – A Game Changer for the US Economy By Genevieve Fraser


 Masnedø CHP power station in Denmark. This station burns straw as fuel. The adjacent greenhouses are heated by district heating from the plant. Source: http://en.wikipedia.org/wiki/Cogeneration


“CHP” – A Game Changer for the US Economy
By Genevieve Fraser

In late August as the nation prepared for a long Labor Day weekend, a White House executive order put a different spin on the way the nation’s industrial sector will handle energy efficiency in the future.  The Obama initiative is destined to make “CHP” (combined heat and power) a catalyst for American productivity and competitiveness while significantly reducing greenhouse gas emissions.  Combined heat and power technology can be applied to fossil fuels such as natural gas, coal and oil as well as to biomass, an environmentally friendly renewable fuel.
Cogeneration, aka CHP, implementation is designed to spur investments in the manufacturing and jobs sector of the economy by decreasing energy consumption in a sector that accounts for over 30 percent of the nation’s energy.  The concept behind combined heat and power (CHP) is to generate electric power and useful thermal energy from a single fuel source instead of separate sources of heat and power (SHP).  
According to a US Department of Energy report, A Clean Energy Solution (8/2012), “Instead of purchasing electricity from the distribution grid and burning fuel in an on-site furnace or boiler to produce thermal energy, an industrial or commercial facility can use CHP to provide both energy services in one energy-efficient step.”
“The average efficiency of power generation in the United States has remained at 34 percent since the 1960s — the energy lost in wasted heat from power generation in the U.S. is greater than the total energy use of Japan. CHP captures this waste energy and uses it to provide heating and cooling to factories and businesses, saving them money and improving the environment,” the DOE report states.  “CHP can also be an attractive resource for commercial or institutional facilities such as schools and hospitals, in district energy systems, and in military installations.”
The August 30, 2012 “Executive Order -- Accelerating Investment in Industrial Energy Efficiency” focuses on a number of national priorities including improving the competitiveness of U.S. manufacturing, increasing energy efficiency, reducing emissions, enhancing our energy infrastructure, improving energy security and growing our economy.  However, the use of CHP in the US has been limited because of a host of market and non-market barriers, including federal and state regulatory barriers.   
The U.S. Department of Energy (DOE) will be hosting a series of workshops to foster a national dialogue on developing and implementing state best practice policies and investment models that address the multiple barriers to greater investment in industrial energy efficiency and CHP.  However, twenty-three states already recognize CHP in one form or another as part of their Renewable Portfolio Standards or Energy Efficiency Resource Standards. And a number of states have initiated specific incentive programs for CHP.  For example, the Massachusetts Green Communities Act includes a rebate incentive for efficient CHP systems of up to 50 percent of total installed costs.  For more information, visit the US DOE’s Clean Energy Application Centers website: http://www1.eere.energy.gov/manufacturing/distributedenergy/ceacs.html
NOTE: Genevieve Fraser of GF Strategic Enterprises is a recipient of a Massachusetts Environmental Commendation and is a former environmental technical writer and planner with the Private Industry Council.

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