The Combined Heat and Power Technology - Literature review Example

HEAT & POWER (CHP) Introduction Combined Heat and Power (CHP) systems are also known as cogeneration. As the indicates these are systems that generate electricity and thermal energy in a single, integrated system. It is often confused that CHP is a technology which it is not true. It is an approach to applying technologies. Since CHP is a combined generation of electricity and thermal energy it is considered as more energy efficient when compared to systems that work on separately. CHP technologies produce electricity or mechanical power and recover waste heat for further use. In fact these are considered as eco-friendly technologies. Heat that is generally wasted in conventional power generation is recovered as useful energy. This energy is in turn used for satisfying an existing thermal demand such as heating and cooling of the building and water supply. Through this process it is possible to avoid the losses that would otherwise be incurred from separate generation of power (See figure). According to Casten (1998) conventional centralized power systems average less than 33% delivered efficiency for electricity in the U.S. where as CHP systems can deliver energy with efficiencies exceeding 90%1. Additionally, it also helps to significantly reduce emissions per delivered MWh. If we look into the cost and benefits of CHP systems it can be said that these systems can provide cost savings for industrial and commercial users and substantial emissions reductions. Some of the popular examples of CHP systems are diesel engines, natural gas engines, steam turbines, gas turbines, micro-turbines and fuel cells. This is a technology that is popular in most parts of the world and most of the CHP technologies are commercially available for heat and power applications (ONSITE SYCOM, 1999). The efficiency of a CHP system depends on the basic technology used to generate the electricity and thermal energy, the system design, and the amount of utilizable thermal energy. Therefore, each CHP system will have its own efficiency and a site-specific efficiency once installed. The following are the six most commonly installed CHP systems that tend to offer in general good standard ranges of achievable efficiency: A Steam Turbine works with an efficiency of 80 percent. A Diesel Engine and Natural Gas Engine gives about 70-80 percent efficiency. Gas Turbine works with an efficiency of 70-75 percent Microturbine works with an efficiency of 65-75 percent Fuel Cell works with an efficiency of 65-80 percent (EPA, 2007). CHP systems are known for three general categories of benefits i.e. environmental, economic, and transmission and distribution. Though these systems are popular in most parts of the world, several barriers, such as utility interconnection costs and related issues, environmental regulations in certain states and technology costs have kept these technologies from wide use. However, today in many parts of the world these technologies are undergoing tremendous improvements to decrease costs and emissions and at the same time increasing efficiency. The benefits of CHP systems in the business environment are undergoing dramatic changes. These systems are being designed to match the customer choice through utility restructuring and as a result CHP is gaining wider acceptance in the market (ONSITE SYCOM, 1999). The basic mechanism by which a CHP system works is an important aspect to understand. A CHP system generally uses fuel such as diesel or natural gas to produce heat and electricity at the same time. The electricity that is produced can be used for any household device such as lights and appliances and the heat produced can be used for water heating and/or space heating. However efficient the CHP system is, it is a common factor that roughly about 10% of the fuel used is lost as exhaust. The second important part is the engines used in the CHP units for producing electricity. These engines can be internal combustion or external combustion (also called Stirling) engines. Other types of CHP systems such as fuel cells are yet to reach its full potential in commercial applications. Micro-CHP are generally used in the residents and are usually run on propane, natural gas, or even concentrated solar energy or biomass. When electricity is generated a lot of heat is also generated which in normal cases are wasted. For instance, one 6-kW unit provides 10 gpm of hot water at 140 to 150°F it the electricity is generated using CHP. When the natural resources are getting lesser and lesser day by day, it becomes the responsibility of each and every individual to use these non-renewable resources with at most care and efficiency. The waste heat can be used to heat an entire home, water for domestic use, or for swimming pools and spas. CHP systems are the new world technology that are extremely efficient, offering combined heat and power generating efficiency of about 90%, compared to about 30 to 40% for electricity from a central power station. In general the micro-CHP units range in capacity from about 1 kW to 6 kW and are about the size of a major appliance. It is estimated that one unit with a small capacity engine concurrently produces 1.2 kilowatts of electric power and 11,000 Btus of heat in the form of hot water. The advantages with small engines are that it tends to burn very cleanly - exceeding all emissions requirements for carbon dioxide and nitrogen oxides. One unit claims to produce less carbon monoxide and nitrous oxides than a single burner on a kitchen gas range (ToolBase Services, 2007). To summarize the major benefits or advantages of CHP systems are – In a long run it reduced energy costs; Enhanced security of energy supply; Reduced CO2 emissions, making a valuable contribution to the environment, and conservation of valuable fuel resources. The maximum benefit of natural gas-fired CHP technology is achieved when the production of power and heat is combined. However for this to be technically and economically feasible, it is essential that the demand for heat and electricity on the premises is for a minimum of 14 hours per day or around 5,000 hours per year. In recent years the development of gas turbines has improved the attractiveness of cogeneration for particular industrial applications. By changing from separate systems producing heat and power to a single industrial unit considerable amount of energy are saved. In general, up to 85 % of the primary energy is used in industrial CHP systems which are high level of efficiency compared to all other forms of conventional or traditional generation. Therefore, CHP systems offer industry two main benefits. Firstly it represents a highly efficient use of energy, which means lower costs for energy users and secondly CHP also delivers significant emissions reductions (Irish CHP Association, 2005). Unfortunately, till date the only disadvantage with the CHP systems is that none of the systems produced are able to fully utilize all of the thermal energy produced when generating electricity. However, as the technology develops, various new operating regimes will be tested to maximize the energy available based on variables such as the loads in the home, the climate and the season (ToolBase Services, 2007). With the help of the U.S. Department of Energy, industry has developed advanced integrated energy systems and pushed the performance on reciprocating engines to develop both electrical efficiency and reduce emissions. In spite of these technological advances, the adoption of CHP technologies has been slow due to a number of challenges as mentioned earlier that impact cost or limit benefits. Besides the one time installation process will also be expensive. Many of benefits associated with a CHP system most often do not have a clear or immediate impact on profit margins and this is a reason that many companies are reluctant to install CHP systems. Besides, power production is not as efficient as the traditional systems, which can severely limit a CHP project’s budget. In many countries the challenges come from the financing institutions. For instance partial or inadequate access to low-cost financing further complicates the process since most traditional financial institutions consider distributed generation projects as high-risk investments. The dearth of financial incentives such as accelerated depreciation schedules for CHP equipment or additional benefits for avoided emissions can further compound this initial challenge. Even with the availability of financing, the business that adopts this technology may face difficulties with regulations and procedures imposed by the government and by electric utilities. Environmental regulations are yet another issue that can delay or stop the progress of a project depending on permitting regulations, particularly those related to air pollution (Bullock and Weingarden, 2006). In United States the CHP systems date back more than 100 years and were the most common electricity generators. With the increasing energy crisis of the 1970s in United States, they have adopted back and re-discovered the benefits of CHP. It is estimated that presently approximately 56,000 MW of CHP generations is in operation in the United States. A combined effort is made by the CHP industry, DOE and EPA to doubling that number by 2010 (Energy Solutions Center, 2005). Today, the usage of energy has increased so much that in no other century or no millennium in the history of man was the growth in energy use as much as it is in this century. In fact, man in the 20th century used 10 times as much energy as in the thousand years before 1900 A.D. To be more specific, man has probably deployed more energy since 1900 than in all of human history before 1900. The CHP systems are also becoming popular in the rest of the world. With the increasing pressure on fossil fuels and other sources of fuel, it is the need of the hour to maximize the use of CHP systems where the heat that is generally wasted is used in an efficient manner for various household and industrial purposes. It also cuts down the energy costs by as much as 40% and produces power at rates lower than electric utility. It is therefore very essential for governments to formulate policies that promote the use of CHP systems that will benefit in long term and reduce the burden on environment. Figure: Conventional Generation Vs. CHP Generation Source: EPA, 2007 References Bullock,D. and Weingarden, S.L. (2006) Combined Heat & Power (CHP) in the Gulf Coast Region: Benefits and Challenges, Houston Advanced Research Center. Casten, T. (1998) CHP – Policy Implications for Climate Change and Electric Deregulation, May, p:2. Energy Solutions Center, (2005) Combined Heat and Power (CHP) – By any name, it’s good for business, [Online] Available from: [Accessed on 22 August 2007]. EPA (2007) Efficiency Benefits, [Online] Available from: [Accessed on 22 August 2007]. Irish CHP Association, (2005) The Advantages of CHP, [Online] Available from: [Accessed on 22 August 2007]. ONSITE SYCOM, (1999) Review of Combined Heat and Power Technologies, [Online] Report created by ONSITE SYCOM Energy Corporation for the California Energy Commission under grant number 98R020974 with the U.S. Department of Energy, Office of Energy Efficiency and Renewable Energy. Available from: [Accessed on 22 August 2007]. ToolBase Services, (2007) Combined Heat and Power Systems for Residential Use: An appliance which makes home-spun electricity and heat, [Online] Available from: [Accessed on 22 August 2007]. Read More