What is CHP?
CHP stands for Combined Heat and Power and is also known as Cogeneration. CHP uses a single fuel source – such as natural gas, renewable natural gas or hydrogen – to generate both electricity and thermal energy for buildings with central heating and cooling, hot water, and electrical service. This technology is growing in use due to its energy efficiency and reliability benefits.
Whether you need solutions for a multifamily or industrial building, CHP can benefit project budgets of all sizes, while reducing greenhouse gas emissions that would otherwise be emitted be less efficient technologies.
Source: EPA, Common CHP Configurations
Benefits of CHP include:
- Improves energy efficiency by maximizing energy utilization (up to 95 percent) with natural gas, with the potential to reduce overall operating costs.
- Reduces energy usage by recovering heat for generating hot water and/or chilled water and/or steam (for direct use and building heat) while offloading can be as low as 10% or as high as 100% of the electricity from the electric grid. This can help reduce costs and can contribute to your LEED building certification.
- Generates reliable electricity with independent, underground infrastructure, keeping your operations up and running through unexpected electricity interruptions.
CHP reduces energy usage and is economically beneficial for buildings across industries, uses, and scale.
For an example of how natural gas can be used to fuel combined and heat power, click to read our HP Hood Customer Story.
Learn more about the benefits of combined heat and heat power. Take the next step and receive a free consultation.
Combined Heat and Power Resources:
Learn more with additional resources:
- Environmental Protection Agency
- Department of Energy
- Energy Solutions Center
- Renewable Thermal Collaborative
- Combined Heat and Power Alliance
CHP Technology Options
The excess heat generated by reciprocating engines is ideal for hot water or low-pressure steam applications, such as multifamily buildings, hospitals, hotels, schools, and nursing homes. When paired with an absorption chiller, reciprocating engines work well for year-round climate control applications in all CHP applications. A few benefits of reciprocating engines include low cost, fast startup, flexibility in operations, and an option to operate on low pressure natural gas.
Micro CHP products can generate enough heat and electricity to make a residence or a small commercial building self-sufficient. In some cases, it can generate more power than is used, thus complementing the grid where net metering is available. Micro CHP equipment is available today as engine-driven or fuel cell-based systems. Some benefits of Micro CHP include compact and light weight sizing, a low number of moving parts, and simple operations.
Steam turbines are customizable, high-production technologies that feature a dependable operating life of 45 years1. They are ideal for large industrial and commercial CHP applications with high process-related thermal requirements that are not subject to weather-related fluctuations, making energy an important part of the business.
1 Median expectancy
Natural gas combustion turbines are similar to those used in jet engines, but have lower emissions compared to other combustion generators that use conventional fuels. These CHP applications can support high-pressure steam generation and reach efficiencies as high as 80 percent, making them ideal for industrial processes or large commercial projects like a university campus.
Fueling the Future
In recent years, fuel cells have proven to be an exciting and innovative path forward for natural gas. Put simply, fuel cells convert methane in natural gas into electricity without combustion. The output is efficient electricity that can transform your energy portfolio.
Explore just a few benefits of using fuel cells for your building:
- Environmental: Fuel cells are a highly efficient method of generating electricity, generating it on-site without combustion.
- Efficient: Fuel cells use natural gas very efficiently at reduced costs, even providing higher total system efficiency than many other generation sources with the same amount of fuel input.
- Reliable: Fuel cells use no moving parts, making them quiet, durable, and less prone to mechanical issues.
- On-Site Energy: Typically, electricity must travel through power lines to get to your home, and a considerable amount of that electricity is lost along the way. But fuel cells produce electricity on-site, so you don't lose it in transmission.
Did You Know? Though fuel cells are a relatively new technology, they have potential for tremendous growth in application and consumption for more efficient lower emission buildings.
Learn more about the benefits of fuel cells. Take the next step and receive a free consultation.
Micro solution, Macro results
When you power a microgrid with natural gas for your project, you optimize efficiency and reliability benefits.
While a microgrid operates mostly within the larger energy grid, the capability of operating independently makes it a great option for crisis prevention and cost-savings. And natural gas already benefits from a more resilient distribution network than electricity, making it a great match for the dependability of microgrids.
Microgrids are ideal for essential buildings like hospitals, schools, and government operations due to their controlled nature, scalable performance, and back-up capabilities. With microgrids, you can easily power a single facility or a much larger area.
A microgrid in Fort Collins, Colorado is being used as part of a larger initiative to create an entire district to generate as much thermal and electrical energy within the district as the district uses!
Natural gas is highly efficient and reliable, which can help you save on energy bills and allow you and your customers to maintain operations during extreme weather with natural gas backup generators.
These are just a few CHP incentives that can help make your project more cost-effective:
Special Washington Gas CHP Rate - D.C. only
- To qualify for a low CHP gas distribution rate, the customer must use a minimum of 60,000 therms/year through onsite electric generation equipment. Customers can expect an average annual economic savings that can, depending on a customer’s specific circumstances, range as high as $220,000 due to the low distribution rate and the onsite generation of approximately 50-80% of the required electric demand for multifamily and/or commercial customers.
- To learn more about Washington Gas' Combined Heat and Power Tariff Rate, Schedule No. 7, click here.
Federal Incentives (D.C., Maryland, and Virginia)
- 30% and up to 50% Federal Tax Investment Credit (FTIC) for the total cost of the CHP system
- 100% bonus depreciation of the total CHP system cost in the first year of use
- C-PACE - Commercial Property Assessed Clean Energy (C-PACE) financing:
- C-PACE provides low-risk capital loans to organizations pursuing projects that enhance energy efficiency, implement renewable energy technologies, and/or install water efficiency improvement measures at their properties.1
- C-PACE is available to our customers who live the following Maryland counties: Montgomery, Prince George’s, Frederick, and Charles. To learn more about the program, visit C-PACE’s financing resources.2
Get the Best Rates
Appreciating the full benefit of natural gas use for improving efficiency requires an understanding of where it comes from. Just what exactly goes into bringing energy to your building, and how does that affect our planet?
The full-fuel cycle measures energy consumption through the entire process from extraction to transportation. Take a look at how energy gets to you.
More efficient from start to finish
When using natural gas, 92 percent of source energy reaches you from the start of its journey. Electricity provides just 32 percent of that usable energy since so much is lost in transportation. That means less energy is wasted in transmission with natural gas.
Using energy from a diverse range of sources can make your building more resilient against disruption and more cost-efficient as well. Natural gas is already an integral part of the energy mix across the mid-Atlantic. Natural gas provides 33% of the electricity to the Mid-Atlantic area. You can explore natural gas and renewables to reduce dependency on the electrical grid.