Combined Heat and Power systems would save energy costs, reduce CO2 emission

Doubling the capacity of Combined Heat and Power systems in the United States to 20 percent would reduce annual energy consumption  by 5.3 quads, while dropping CO2 output by 850 million metric tons, or the equivalent of removing 150 million cars from U.S. roads.

The numbers were part of a presentation before the Assembly Telecommunications Committee by several energy company officials on the benefits of CHP, which is a system that generates power while recovering waste heat for use in heating, cooling or dehumidification.

The systems can run on any fuel source and use any power technology, though generally they are fueled by natural gas.

The officials told the committee that CHP systems are far more efficient than separate generation of both electricity and thermal energy and would reduce harmful emissions while dropping the cost of energy.

In addition, CHP systems can increase power reliability to users such as hospitals, which face particular risks when power shuts down.

Advocates of the technology are looking for subsidies and benefits equal to those granted to renewable energy sources such as solar and wind power.  But opponents of the subsidies say the fuel is not renewable so it does not deserve the same treatment as other sources.

“We would support low interest loans and other programs but they shouldn’t be treated the same as renewable forms of energy,” Jeff Tittel, director of the New Jersey Sierra Club.

Bruce Hedman, vice president of energy systems at ICF International said the use of an industrial sized CHP system can drop the cost of delivered electricity to under 8 cents per kilowatt hour, about 3 cents per kilowatt hour cheaper than straight electricity delivery.

Currently, there are 85 gigawatts of installed CHP capacity in the U.S., powering over 3,800 industrial and commercial sites.  According to numbers provided by Hedman, the resulting savings amounts to 1.9 quads of energy and 248 million metric tons of CO2 reduction – the equivalent of removing 45 million cars from the road.

New Jersey’s capacity is about 3.5 gigawatts powering about 250 sites, but according to Gearoid Foley, New Jersey director of the Department of Energy’s Mid-Atlantic Clean Energy Application Center, the state’s potential capacity is more than 2,733 megawatts at 7,813 sites.

Assemblyman Joe Malone (R-30) questioned why, if the potential cost and emissions reductions were so great, isn’t every building built using CHP.  Paul MacGregor, senior vice president of Nexant, told Malone the major barrier is entry cost.

“It’s the initial cost and the time to recover that cost,” MacGregor told Malone, adding that a government incentive would shorten the recovery time.

“A little extra incentive allows the process to be more attractive to users,” he said. Combined Heat and Power systems would save energy costs, reduce CO2 emission