Considerations for successful planning and design of CHP systems

CHP insights

• Combined heat and power (CHP) systems enhance energy efficiency and reduce operational costs and greenhouse gas emissions.
• The success of CHP projects often hinges on factors like continuous demand for electrical and thermal energy, favorable utility policies and attractive payback on energy cost savings.

Combined heat and power (CHP), or cogeneration, is a process where electricity and usable heat are produced coincidentally. The benefit of CHP is increased energy use efficiency compared to traditional utility power generation from the grid and heat from a local source – such as a facility steam boiler. Limiting factors preventing widespread expansion in the early development days included the physical separation of power-generating facilities from industrial hosts and utility control of the sale of generated electricity to customers.

However, CHP has always been popular in heavy industrial or campus facilities, where substantial amounts of electricity and thermal energy are used continuously.

CHP plants offer upward of 80% increased overall efficiency, which reduces energy cost, lowers emissions, lessens the greenhouse gas footprint through less fuel consumption and improves reliability by locating a backup source of electrical generation at the host site to protect against grid outages.

CHP basics

The U.S. Department of Energy, Office of Energy Efficiency and Renewable Energy, defines the CHP process as “the concurrent production of electricity or mechanical power and useful thermal energy (heating and/or cooling) from a single source of energy.” While this basic definition allows for several different input fuels to have a variety of outputs, this article is based on natural gas as the input fuel and electricity with a heat supply as the output.

Current CHP trends

Because natural gas is the most common fuel for CHP facilities, recent trends are driven by low natural gas prices, the desire to lower greenhouse gas footprint and financial incentives from the government’s green energy initiatives. Proponents of CHP have stipulated that distributed generation, meaning noncentralized electrical power generation, helps avoid the need for new electrical transmission and distribution infrastructure and eases power grid congestion. With the rapid advancement of electric vehicles and renewable energy generation, the country’s electrical transmission and distribution infrastructure will be pushed to the limit and CHP can assist in this transition.

Figure 1: This diagram shows energy efficiency by source use for conventional power generation as compared with combined heat and power. Courtesy: PEC – A Zero6 Energy Company

CHP projects may be implemented for a variety of facility types and for a variety of sizes depending on parameters. There are drivers for each system type and size that are based on the specific site needs, including financial restrictions, owner needs and process requirements.

In most cases, large CHP projects are the most viable and successful because of economies of scale. Large-scale energy cost savings in fuel and electricity provide enhanced payback when compared to overall capital expenditures and the level of effort required to execute a successfully CHP project. Additionally, large CHP hosts or owners are often familiar with the integration and operation of these types of complex facilities.

Small CHP projects have been more successful recently due to the fully integrated packaged designs developed by equipment integrators. These small CHPs are marketed as either containerized or “plug-and-play,” where a host can simply purchase a fully integrated package and install the CHP within their existing system infrastructure. Examples of these types of systems are microturbines with heat recovery, reciprocating engine generators with hot water heat recovery systems and waste heat packages that produce usable energy from heat that would normally be exhausted to the atmosphere.

CHP success factors

Numerous factors contribute to the successful implementation of a CHP project, but the following are generally most prevalent:

• The project is in an area where the electrical utility is a proponent of CHP or open market electrical interconnection conditions exist. Many projects fail because the interconnection of a distributed generation asset is blocked by the utility, even if the host’s desire is only to serve internal, “behind the meter” electrical demand. Islanding or disconnecting from the utility completely often derails projects because of the high cost of redundant generation assets and reliability risk factors.

• There is continuous electrical and thermal energy demand of reasonable size. Electrical and thermal demand needs to “match” in a certain range. Projects are generally not successful if one or the other is abnormally small. A CHP design configuration can be selected as more “electrical power dense” or “thermal concentrated,” but generally a continuous demand of some minimum size is required for a CHP to make sense.

• Payback on CHP energy cost savings are attractive enough from a capital expenditure standpoint. A CHP host can either deploy available capital or enter a contract to buy energy from a third-party-owned CHP on the host site. In many cases, the host’s core business is completely unrelated to the CHP and the savings payback potential is not worth that capital commitment. Many hosts prefer to deploy available capital to their core business interests. Additionally, signing long-term agreements, generally 15-20 years, with a third party is often challenging from a business commitment and financing perspective. However, if energy cost is a substantial component of the host’s operating cost structure and the savings payback is significant, a CHP project can be successful.

• The host is motivated by outside factors. This may include emissions reductions, desire to lower their greenhouse gas footprint, necessary replacement of existing energy infrastructure or expansion of energy users such as electrical and thermal as part of a facility expansion.

Figure 2: A diagram that separates out the percentage of combined heat and power currently in use. Courtesy: PEC – A Zero6 Energy Company

Design considerations for CHP systems

There are numerous design considerations when planning for a CHP facility. The considerations are typical for most large and small CHP systems and are driven by equipment options, local building codes and owner needs. The design team for a CHP system needs experienced project partners to successfully implement a system, whether a standalone structure or an integrated system.

Combined heat and power systems include many different systems, each individually addressed in building codes. These systems include boilers, turbines and electrical distribution gear. These systems are supported by other building utilities including natural gas distribution, ventilation systems, lighting, fire alarm, security/surveillance and general plumbing systems. There are numerous sub-sets of these main systems to support the overall process system of CHP.

Available CHP equipment, including specialized boilers, turbines and electrical gear, will primarily drive the building layout. This equipment is typically specialized for the specific installation and requires close coordination with the equipment manufacturers to ensure the systems can provide the required capacity and capability. Building size will further be driven by the available space on a site. Often a single-story structure will be the most cost-effective, but site constraints require a multistory building to house the equipment.

Figure 3: A model of the combined heat and power cycle for the Dearborn Central Energy Plant. Courtesy: PEC – A Zero6 Energy Company

A CHP facility needs to house the primary process equipment and allow for the utility connections to serve this equipment. As mentioned, there are several sub-systems required to support a CHP process that require space in and around the building in addition to the space requirements for the direct process equipment.

Sub-system space considerations include:

• Input fuel source: An example of this is natural gas that requires space for a large meter assembly on the building exterior and close coordination with the supplier to ensure adequate supply during normal operation and through any unexpected events that may affect the distribution system.

• The transformation, metering and distribution of electrical power: This electrical distribution needs to comply with utility requirements for metering, isolation and other standards. Commonly, electricity is generated through a turbine utilizing boiler steam or hot water from a generator or engine jacket. This hot temperature medium is then fed through a turbine generator to produce electricity. The electricity from the turbine may be medium voltage that requires transformers and other gear in a separate electrical room to convert it into a usable type for the building or campus.

• Support space for CHP operators: While the CHP process may be set up to be automated, operators are still required to perform maintenance, oversee the process and be available to address operational issues as they occur.

Codes and standards to consider when designing CHP systems

An important part of the design for a CHP process is compliance with local building codes. Different areas in the U.S. utilize different versions of codes, some current, some a few years old. Generally, in the U.S. compliance with International Code Council (ICC), such as the International Building Code, International Mechanical Code and the International Energy Conservation Code, are the minimum requirement, though some areas of the country utilize uniform codes or other standards. The design team must identify early on which codes are in effect for the project location, especially if the design team includes project partners from different areas of the country.

Commonly, utilizing the ICC codes for the specific years adopted by the local authority having jurisdiction (AHJ) will provide 70% of the project’s code requirements. The AHJ may provide other information that is focused directly on CHP systems, such as New York City’s Building Code and Energy Code, which provides specific separation and efficiency requirements that must be met for code compliance. Another source of information for planning and design of CHP systems is located in the National Fire Protection Codes (NFPA), including NFPA 13: Standard for the Installation of Sprinkler Systems, NFPA 70: National Electrical Code and NFPA 110: Standard for Emergency and Standby Power Systems. It is important that the design team carefully considers other NFPA standards that may apply to the project and ensure that the design meets a standard of care by using the best resources available.

Additional CHP requirements and considerations

Owner requirements may be considered the most important part of the design process, because without these requirements the project may not exist. The project owner could be a system developer, process company or other organization providing project funding. There are a few common goals of a CHP project including: to increase electrical reliability on a site with the benefit of an additional heat source, to provide the facility with the ability to go off-grid and be standalone from the local electrical utility or to increase project resilience for the facility in the aftermath of a natural disaster by quickly reengaging the process and systems at a facility.

Figure 4: The University of Wisconsin Charter Street Heating Plant is based off a “thermal concentrated” combined heat and power design. Courtesy: PEC – A Zero6 Energy Company

There are many resources beyond building codes to consider when designing CHP systems. The Environmental Protection Agency provides basic resources for planning and designing CHP systems focused on increasing reliability and resilience in buildings, particularly for protecting buildings during and after natural disasters.

Environmental compliance is an integral part of establishing a CHP system for a facility. Compliance standards vary throughout the country and each location may have specific requirements beyond those of federal or state codes. It is imperative that the project team include an early review of allowable discharge limits, site approval and general conformance with land use requirements before starting a CHP project. These requirements may greatly affect the size and location of a CHP project as well as the construction and operation of the facility.

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