Combined Heat And Power Projects Research Articles

Risk Identification in Cogeneration (Combined Heat and Power) Projects: A Polish Case Study

The purpose of the article is to define the risk factors in cogeneration projects and to demonstrate that a lack of sufficient identification of risks in different phases affects project implementation. A theoretical study is conducted, which aims to identify risk factors in cogeneration projects, based on case studies of such projects in Poland. The study offers a view at CHP (combined heat and power) projects as extremely dependent on the external environment of the organisation. These projects are subject to many external regulations due to their environmental impact and dynamically changing technical aspects. The biggest technical errors occur at the planning and construction stages. The biggest economic and financial risks occur at the execution stage after 2% and 3% of additional design costs occur, respectively. The authors estimated the risks at different stages of the project and concluded that the total cost of failure in correct identification of the risks at the planning stage exceeded PLN 1.5 billion, which amounted to almost 60% of the total additional costs of materialised project risk. Consequently, the biggest challenges in the area of CHP project management at the planning stage are a thorough identification of risks, and the pricing and planning reactions to risk.

The feasibility of using a combined heat and power system in a car factory with different consumption and investment scenarios

ABSTRACT Decreasing energy consumption, greenhouse gases, and fuel cost motivate researchers toward using Combined Heat and Power (CHP) systems. Of course, finding suitable scenarios for consumption, sales, and investment is very important in using the CHP system. In some countries like Iran due to the non-consideration of the environmental taxes and low fuel prices implementing the CHP projects is still a challenge. Although the economic and technical benefits of CHP projects are truly registered, the methods of financing are still a dilemma. In the present study, the feasibility of using the gas engine to generate electricity and recovering the exhaust waste heat to supply the required heat of a car-manufacturing plant in northeastern Iran was investigated. The different numbers of gas engines to supply heat and electricity were analyzed. Based on the results, the use of three gas engines supplied more than 75% of the annual required heat of the car factory. Also, two different investment scenarios for attracting investors were proposed. These scenarios improved the conditions to attract the investors via displaying the financing landscapes of the project and providing its detailed information. Considering the results, when the car factory is the investor, the strategy of electricity sales to the grid and exhaust heat consumption in the car factory is the most cost-effective selection.

Non-financial barriers to combined heat and power in the United States - A qualitative study

The economic viability of new energy technologies is held as a central tenet to their future deployment; conventional wisdom posits economically rational decision-makers will readily invest in proven low-risk and affordable technologies. But what happens when this is not true. This paper examines the non-financial barriers facing economically viable Combined Heat and Power (CHP) projects. CHP is a mature and lower carbon technology that efficiently uses waste heat from thermal electricity generation; CHP can also provide flexibility services to help integrate variable renewable resources. CHP is low risk and many industrialized countries, particularly those in colder climates in Northern Europe and Russia, generate as much as 50% of their electricity and heat needs from CHP, but United States deployment remains low and investment hurdle rates high. While lower U.S. energy costs make some projects un-economic, many economically-viable CHP projects are stalled or killed by non-financial barriers. To better understand why financially viable CHP projects are not getting built, developers, owners and operators, regulators, and other stakeholders of this technology were interviewed and three major barriers emerged a) the business model of the electrical utility b) negative subjective impressions and c) challenges in allocating the risks and benefits.

Subfreezing Absorption Refrigeration for Industrial CHP

The design and operation of an advanced absorption refrigeration unit (Thermochiller) as part of an industrial combined heat and power (CHP) system is presented. The unit is installed at a vegetable processing plant in Santa Maria, California. The overall integrated system includes the engine package with waste heat recovery, Thermochiller, cooling tower, and chilling load interface. The unique feature of the system is that both the exhaust and jacket heat are used to supply subfreezing refrigeration. To achieve the low refrigeration temperatures of interest to industrial applications, all components of this integrated system needed careful consideration and optimization. The CHP system has a low emission natural gas-fired 633[Formula: see text]kW reciprocating engine cogeneration package. Both the exhaust heat and jacket heat are recovered and delivered via a hot glycol loop with 105[Formula: see text]C supply temperature and 80[Formula: see text]C return. The 125 ton ammonia absorption chiller (TC125) chills propylene glycol to [Formula: see text]C and has a coefficient of performance of 0.63. TC125 has peak electric demand of 10[Formula: see text]kW for pumps and 8[Formula: see text]kW for the cooling tower fan. The CHP system, including TC125, operates 20[Formula: see text]h per day, six days per week. All operations of TC125 are completely automatic and autonomous, including startups and shutdowns. Industrial refrigeration is typically a 24/7 load and highly energy-intensive. By converting all the engine waste heat to subfreezing refrigeration, Thermochiller brings added value to cogeneration or CHP projects.

The Significance of a Building’s Energy Consumption Profiles for the Optimum Sizing of a Combined Heat and Power (CHP) System—A Case Study for a Student Residence Hall

University buildings, such as student residence halls with year-round consistent energy demands, offer strong opportunities for Combined Heat and Power (CHP) systems. The economic and environmental feasibility of a CHP project is strongly linked with its optimum sizing. This study aims to undertake such an assessment for a CHP system for a student residence hall located in London, the United Kingdom (UK). The study also aims to undertake a sensitivity analysis to investigate the effect of different parameters on the project’s economics. Necessary data are collected via interviews with the University’s Energy Manager. Modeling of the CHP system is performed using the London South Bank University (LSBU, London, the UK) CHP model. Results demonstrate that optimum sizing of CHP is crucial for achieving higher economic and environmental benefits and strongly depends on the authenticity of the energy consumption data, based on which the CHP is being sized. Use of incorrect energy data could result in an undersized or oversized CHP system, where an oversized system will result in higher negative results compared to an undersized system. Finally, Monto Carlo statistical analysis shows that electricity price is the significant factor that could affect the project’s economics. With an increasing spark gap, the payback period decreases, and vice versa.

Development of a Combined Heat and Power sizing model for higher education buildings in the United Kingdom

The four Higher Education Funding Councils in the United Kingdom want all universities to reduce CO2 emissions by 34% by 2020 compared to a 2005 base. Universities that have installed Combined Heat and Power (CHP) technology are making good moves towards achieving their CO2 reduction target. For a CHP project to be successful, a detailed technical, economic and environmental assessment is required. Generally, this assessment is carried out using a computer-based model. Currently, available CHP models have limitations in terms of flexibility, accuracy, reliability and complexity and their use could result in an undersized or oversized CHP scheme that could lead to a complete failure of the project. Therefore, there is an urgent need for a robust and user-friendly model, which integrates multiple features that are missing in the currently available models.This paper presents the development of a spreadsheet based CHP sizing model for a single or multiple university buildings. The major strengths of the model are its simplicity, flexibility of data entry, selection of multiple electrical and thermal demands, an in-built real database for a range of CHP sizes, multiple control strategies, multiple investment routes and their life cycle cash flow analysis, and the potential for detailed sensitivity analysis of payback period using the Monto Carlo Simulation technique. The model, which we call the London South Bank University (LSBU) CHP model, has been tested with three other CHP models for different control modes for the same building and the comparisons are discussed.

木質バイオマスの中小規模熱電併給システムの事業性評価

In this paper, the effective woody-biomass utilization system is proposed. In recent year, we are interested in energy security by the Great East Japan Earthquake. In addition, the possibility of renewable energy spread is increasing by the enforcement of FIT (Feed-in tariff). There are abundant wood resources in Japan, but woody biomass is not so popular. Therefore, in this study, we encored the evaluation with a focus on small-scale combined heat and power (CHP) business in which there is a possibility of commercialization. As a result, it was found that CHP business by gasification power generation utilizing the FIT was possible to return on investment in about 10 years. Further, as a result of evaluation by interviews and SWOT analysis of CHP precedents, it was found that only pellets CHP project could achieve.

A comparison of cost-benefit analysis of biomass and natural gas CHP projects in Denmark and the Netherlands

We investigate what drives differences in the project appraisal of biomass and natural gas combined heat and power (CHP) projects in two countries with very similar energy profiles. This is of importance as the European Commission is assessing the potential scope of harmonizing renewable electricity support schemes post 2020. Concurrently, it is also promoting the use of cost benefit analysis (CBA) for transnational energy infrastructure projects. We use CBA to assess the same project proposal in Denmark and the Netherlands, following the respective country's guidelines. We find that especially the fuel costs and the valuation of emissions drive the differences. Furthermore, we establish that the sensitivity of the CBA results not only from policy differences in the countries, but also from differences in the methodology used.

Incentives for Combined Heat and Power plants: How to increase societal benefits?

Investments in new combined heat-and-power (CHP) facilities have fallen short of harnessing what is believed to be CHP's full achievable economic potential and attenuate societal benefits of reducing emissions and increasing resiliency of the power system. Various reasons have been found to explain this “CHP gap,” an example of the “energy-efficiency gap.” This paper examines the effects of understated capital costs and low and volatile CHP capacity factors, which historically are demonstrated by a large number of existing US units, on the economics of CHP facilities and thereby provide a possible explanation for the CHP gap. Given the probability distribution of profitability for a CHP plant, an incentive structure that is modeled similar to insurance against risk of unfavorable outcomes, might compare favorably to the present one-time upfront capital incentive model for attracting new investments. We recommend further research on assurance-based incentives for CHP projects.

Barriers and attitudes of the electric utilities to industrial CHP in the European community

In the European Community (EC) there is a growing recognition of combined heat and power (CHP) as a way of saving primary energy and of limiting emissions of noxious substances. In several member states, government authorities set new rules to support the access of CHP to the electricity market. The future of CHP in the EC looks certainly brighter than its past. Nevertheless, the realization of CHP projects is still troubled by a variety of barriers. We identified the barriers in the industrial CHP market and evaluated the attitudes of the electric utilities towards industrial CHP in the different EC member states. This article gives an overview of the main results. The analysis concludes that in several EC member states two important obstacles hinder the growth of industrial CHP: first, the gap between the fuel costs for central power generation and for CHP; second, the negative attitude of the electric utility(ies).

Biomass CHP and Thermal Projects for Federal Facilities

ABSTRACT A substantial number of federal facilities are considering biomass as a source of renewable energy through district heating or combined heat and power (CHP) for their locations. A brief overview is provided of the commercially available technologies likely to best serve their existing energy demands. General economics are presented for a typical federal facility considering a biomass CHP or thermal project. The economics show that thermal projects are more economical than CHP projects for the sizes evaluated and that energy projects converting an existing fuel oil boiler facility to woody biomass can be very attractive. For site-specific biomass CHP or thermal project techno-economic feasibility, a more comprehensive feasibility study should be conducted to provide specific results.

The Electrical Cost Threshold As a Measure of Economic Viability for Combined Heating and Power Applications

ABSTRACT “Spark spread” refers to the difference between the cost of electricity and the cost of fuel on a per-MMBtu basis. This metric is often used when considering the economic feasibility of Combined Heat and Power (CHP) systems. A spark spread of at least $12 per MMBtu is considered the threshold for economic viability of CHP systems. However, this study shows that increases in the electric or fuel utility rates have an impact on the spark spread required to achieve economic viability of a CHP project. This challenges the paradigm that a single value for spark spread can be used as a “rule of thumb” for determining the economic viability of CHP projects. There are five factors that must be considered when using the spark spread threshold: (1) thermal energy cost, (2) thermal energy recovery efficiency, (3) generator heat rate, (4) installed equipment cost, and (5) desired payback. The combination of these values into an electrical cost threshold provides a more reliable indicator of the economic viab...

A New Market Risk Mitigating Approach to Combined Heat and Power Project Finance Without the Benefits of a Power Purchase Agreement

This article describes a new market risk mitigating model for future combined heat and power (CHP) project finance. The need arose from the fact that federal legislative changes in 2005 no longer entitle cogeneration project financings by law to receive the benefit of a power purchase agreement underwritten by state investor-owned utilities. CHP project investment represents a potentially enormous energy efficiency benefit through its application by reducing fossil fuel use up to 55% when compared to traditional energy generation and concurrently eliminates constituent air emissions up to 50%, including global warming gases. As a supplemental approach to a comprehensive technical analysis, a quantitative multivariate modeling was used to test the statistical validity and reliability of host facility energy demand and CHP supply ratios in predicting the economic performance of CHP project finance. The resulting analytical models, although not statistically reliable at this time, suggest a radically simplified CHP design method for predicting future profitable CHP investments using four easily attainable energy ratios. This design method shows that financially successful CHP adoption occurs when the average system heat-to-power ratio is less than or equal to the average host convertible energy ratio, and when the average nominally rated capacity is less than average host facility load factor demands. New CHP investments can play a role in solving the worldwide problem of accommodating growing energy demand while preserving our precious and irreplaceable air quality for future generations.

Implementing Combined Heat and Power In New York City

ABSTRACT This article provides information about the challenges and opportunities for combined heat and power (CHP) in New York City. Some of the up front engineering processes that must be done to successfully implement CHP projects are identified. Included are some of the cost savings and other financial incentives that motivate the decision to design CHP systems. Detail is provided on the technical challenges that companies face in developing CHP projects.

Landfill Gas as Fuel for Combined Heat and Power

ABSTRACT When landfill gas (LFG) is used in combined heat and power (CHP) systems, the benefits multiply. A CHP project powered by LFG not only provides significantly better energy efficiency and cost savings, but it also achieves significant environmental benefits from using a locally produced, biomass fuel. The U.S. Environmental Protection Agency (EPA), Landfill Methane Outreach Program (LMOP) has supported the development of LFG energy (LFGE) projects for more than a decade. The LMOP encourages the development of LFGE projects in several ways. To achieve more LFG use, the program maintains voluntary partnerships with businesses, communities, and states. The LMOP provides information about LFGE opportunities in the United States and prepares preliminary feasibility studies for landfills and potential LFG users. The LMOP and the LFGE industry have achieved significant reductions in emissions of greenhouse gases, because LFG is approximately 50% methane and methane traps more heat in the atmosphere than ...

Landfill Gas as Fuel for Combined Heat and Power

When landfill gas (LFG) is used in combined heat and power(CHP) systems, the bene fits multiply. A CHP project powered by LFGnot only provides significantly better energy efficiency and cost savings,but it also achieves signi ficant environmental bene fits from using a lo-cally produced, biomass fuel.The U.S. Environmental Protection Agency (EPA), Land fill Meth-ane Outreach Program (LMOP) has supported the development of LFGenergy (LFGE) projects for more than a decade. The LMOP encouragesthe development of LFGE projects in several ways. To achieve moreLFG use, the program maintains voluntary partnerships with businesses,communities, and states. The LMOP provides information about LFGEopportunities in the United States and prepares preliminary feasibil-ity studies for land fills and potential LFG users. The LMOP and theLFGE industry have achieved signi ficant reductions in emissions ofgreenhouse gases, because LFG is approximately 50% methane andmethane traps more heat in the atmosphere than carbon dioxide, themost prevalent greenhouse gas. The collection and use of each ton ofLFG methane is equivalent to the reduction of over 20 tons of carbondioxide emissions.The LMOP maintains a land fill and LFGE project database (LMOPdatabase), which classifies 16 LFGE projects as CHP. These projects rangefrom a 120 kilowatt (kW) microturbine installation to a 12 megawatt(MW) cogeneration plantCHP LFGE projects can create additional environmental bene fitsby offsetting fossil-fuel-based electricity and steam or heating demands with a renewable fuel. In 2007, the existing CHP projects fueled by LFGwill result in greenhouse gas reductions equivalent to preventing the useof approximately 1.3 million barrels of oil.In addition, using the waste heat from LFG- fired generators in aCHP configuration can improve project financial results by as much as100%, increasing the feasibility of developing LFGE projects. LMOP of-fers real-world project experience and tools to overcome the barriers inCHP LFGE project development.

Implementing Combined Heat and Power In New York City

This article provides information about the challenges and oppor-tunities for combined heat and power (CHP) in New York City. Someof the up front engineering processes that must be done to successfullyimplement CHP projects are identi fied. Included are some of the costsavings and other financial incentives that motivate the decision to de-sign CHP systems. Detail is provided on the technical challenges thatcompanies face in developing CHP projects.

Microturbine-boiler Integrations are Efficient and Practical Combined Heat and Power Solutions

An adequate thermal load is critical to a successful combined heatand power project. However, the integration of the waste heat stream froman on-site generator with a facility’s existing steam or hot water systemis often one of the more dif ficult and costly aspects of a project.This brief article is intended to introduce the reader to the basicconcept of integrating microturbines (small gas turbine generators in the30 to 250 kW range) directly with existing building boilers, to achievesimple and highly ef ficient on-site generation systems.The author discusses the direct use of microturbine exhaust inconventional industrial and commercial boilers. This type of thermalintegration greatly simplifies the installation of an on-site generator withexisting building systems, and provides the maximum possible utiliza-tion of the heat, in cases where a boiler is the primary source of thermalenergy in the building.

Creating markets for combined heat and power and clean distributed generation in New York State

Combined heat and power (CHP) is the simultaneous production of electrical or mechanical power and thermal energy from in a single process. Because thermal output from the generation of electricity is captured and utilized onsite, CHP systems can achieve efficiencies from 60% to as high as 90%. In contrast generation of electric power at sites remote from the loads served often results in efficiencies of 33% or less due to losses in generation and transmission and distribution of the power to ultimate end users. A well designed CHP system is the essence of energy efficiency. It may also provide significant environmental benefits. However, the full promise of CHP for improving the efficiency and productivity of businesses and the quality of the environment is unlikely to be realized given the current market structure and regulatory environment in which CHP projects are forced to compete. This paper examines the market structure and regulatory obstacles that hinder the development of more robust markets for CHP in New York State.