Step 1: Qalifying a site for Combined Heat and Power (CHP) or Cogeneration

Goal: Determine whether CHP is worth considering at a candidate site.
Timeframe: 30 minutes
Typical Costs: None
Effort required: Minimal site information, average utility costs
Questions to answer: Which of my facilities are the best candidates for CHP? Is there technical and economic potential for CHP at a particular site? Is there interest and ability to procure if the investment is compelling? What am I trying to accomplish?

The Purpose of the Qualification

The purpose of Qualification is to eliminate sites where CHP does not make technical or economic sense. As a CHP Champion, you first need to analyse the suitability of CHP for your organization and potential site.

There are many types of CHP technologies and applications available for a range of facilities and different sectors. In order to identify the costs and benefits associated with CHP at a specific site, experienced professional engineering analysis is required. Answering some preliminary questions regarding your candidate site before beginning an engineering analysis can save your organisation time and money.

Diverse technical and economic factors contribute to the economic viability of a CHP project.

Technical potential for CHP is based on the coincident demand of power and thermal energy at a facility. Power can include both electricity and shaft power, which can be used for mechanical purposes. Thermal demand can include steam, hot water, chilled water, process heat, refrigeration, and dehumidification. A CHP system can be designed to convert waste heat into various forms of thermal energy to meet different facility needs, including heating hot water in the winter and chilling water in the summer.

Economic suitability for CHP at a specific site is based on: current and future fuel costs and utility rates; planned new construction or heating, ventilation, and air conditioning (HVAC) equipment replacement; and the need for power reliability at the site. CHP project economics are greatly affected by utility policies at the local, state, and federal level.

CHP can improve efficiency, save money, reduce environmental impacts, and improve power reliability for your business or organisation, but only when the CHP system is an appropriate match, both technically and economically, to the specified facility or site.

Finally, the culture of the host organization needs to be thoroughly explored. What are its goals? How are decisions made? What are the expectations for return on investment? How are projects funded? Is the organization open to new procurement approaches? Having an understanding of these basic questions about the organisation's culture will streamline the time needed to navigate the project development process.