Exploring the Benefits of Combined Heat and Power (CHP) Systems

According to the Environmental & Energy Study Institute, there are more than 4,100 CHP systems being employed in the U.S. alone as of 2013.


 First things first: What exactly is a Combined Heat and Power (CHP) system?

Great question. CHP systems combine the production of thermal and electric energy into one seamless process, requiring much less fuel than conventional methods where heat and power are produced individually/separately. This results in a much more efficient and eco-friendly approach to power generation, taking the place of other methods like purchasing power from the grid or employing an onsite furnace or boiler.

A greener way to power

Combined Heat and Power systems can use a variety of fuels that are renewable- and fossil-based, and are even capable of achieving energy efficiencies of over 70 percent! Compare that to separate heat and power generators which are an average of less than 45 percent efficient. It’s quite a considerable difference.

CHP systems are employed primarily in large industrial, institutional, governmental and commercial establishments where a continuous, reliable thermal and electrical power supply is most critical. This includes food processing plants to large refineries, hospitals, retirement homes, water supply and wastewater treatment facilities, chemical plants, office buildings, hotels, airports, college campuses and more.

With that being said, there are 3 key benefits to using a CHP system compared to other conventional methods:

1. Reduced Costs

Reduced costs might be the most attractive incentive for people considering a CHP system investment. When compared to conventional methods of energy generation, CHP saves its purchasers more money - particularly over time (and the savings are considerably high).

In fact, according to McKinsey & Company, an additional 50 GW of capacity (which is equal to around half of the current nuclear generation capacity in the U.S. alone) could be cost effectively employed by the year 2020 and would be able to produce annual savings of $77 billion. Now that’s something to take advantage of.

2. Reduced Greenhouse Gas Emissions

Make no bones about it: the Earth loves CHP. In fact, cogeneration systems provide substantial environmental benefits when compared with the on-site production of purchased electricity and thermal energy. Through capturing and utilizing heat that would otherwise be wasted through power production, cogeneration systems simply require less fuel in order to produce the same amount of energy.

Because less fuel (up to 75%) is burned in order to produce each unit of energy output, combined heat and power technology creates significantly lower greenhouse gas emissions as well as other air pollutants compared to other conventional methods.

Through the production of energy onsite, CHP also avoids any losses from transmission and distribution (T&D) that occur when electricity moves over power lines. By avoiding these T&D losses, CHP further decreases fuel use while helping to avoid any need for new transmission and distribution infrastructure. This also helps to mitigate congestion on the grid during times when electricity demand is high.

3. A Dependable Energy Supply

A disruption in heat and power supply at large institutional or governmental facilities poses a huge threat to the health and wellbeing of the public; not to mention the harmful impact it would have on the economy.

The right CHP systems can provide reliable, 24/7 electrical and thermal power even when the grid is down. According to an article from the Environmental and Energy Study Institute, extended power outages as a result of Hurricane Sandy in the Northeast as well as other recent hurricanes on the Gulf coast lead to billions of dollars worth of economic losses in addition to its threat to the well-being of the public.

However, CHP played a critical role keeping the lights and heat going in New Jersey, New York, and Connecticut during Hurricane Sandy – with CHP-powered hospitals, nursing homes, wastewater treatment plants and apartment complexes able to continue meeting the needs of the community. Not even back-up generators were able to deliver energy during the outage.

The article also mentions how the DOE Gulf Coast Clean Energy Application Center reports that CHP systems have also prevailed during many other instances of natural disaster, like hurricanes Katrina and Rita in Louisiana, as well – proving to be far more dependable than emergency back-up generators.

Determining whether a CHP system makes sense for your specific operations

To be an ideal candidate for CHP, you must be motivated enough to reduce your energy costs in the long-term. Furthermore, if your equipment is on the older side, this creates an even stronger incentive to install CHP.

At the end of the day, there’s never been a better time to consider investing in CHP for reduced costs, increased efficiency and an overall greener tomorrow.

For Reliable and Efficient Heat and Power, CHP Systems Are The Answer

Having a dependable and steady access to heat and power around the clock is paramount in order to operate a productive and safe facility. CHP systems provide a resilient and continuous supply of energy that allow establishments to continue running during grid outages, pose few geographical limitations and can ultimately save power purchasers a lot of money.

See our Complete Guide to Combined Heat & Power (CHP)



Posted by Tilo McAlister | Apr 15, 2021 | Categories: Power Generation