Onsite Cogeneration


How You Can Reduce Your Reliance on Utility Companies and Save Money

The following is an excerpt of a longer white paper. To download a free pdf version of the paper in its entirety, fill out the webform below.
We are accustomed to viewing the inadequacies of our power grid as inevitable; as a result, high and unpredictable electricity costs are generally considered to be an unavoidable cost of doing business. With today’s combined heat and power technology, however, a business can offset much of the high cost associated with purchasing energy from a utility company. More importantly, cogeneration plants can dramatically reduce the unpredictable fluctuations in energy costs associated with unstable market prices and seasonal peaks in demand.

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"Onsite Cogeneration: How Combined Heat and Power Systems Can Reduce Your Reliance on Utility Companies and Save You Money"


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Why is Our Power Grid Inefficient?
The inefficiency of coal plants is largely due to a loss of energy in the form of heat. When coal or another fossil fuel is burned for power generation, only a portion of the energy put into the system is output as electricity. Each engine in the process produces waste heat, and this excess heat is not used to perform any useful work: it is instead released into the atmosphere. Additionally, more energy is lost in the long-distance transportation of electricity via power lines.

Fluctuations in Energy Prices
While inefficiency and high cost of production lead to consistently high energy costs for businesses, a larger problem is the unpredictability of electricity prices. This instability can be attributed to a number of factors. Not only can fluctuations in fuel prices cause energy prices to rise, but spikes in demand can lead to unpredictable electricity costs.

The Unreliability of Grid Power
Another factor to consider when relying on utility power is inconsistencies in supply. From momentary power outages caused by events such as lightning strikes, fallen branches, and animals coming into contact with power lines to blackouts caused by natural disasters or power plant failures, grid power can fail for a variety of reasons.

How Can Cogeneration Help?
Companies can protect themselves from high and unpredictable energy costs by producing a portion of their energy onsite with small-scale cogeneration plants, decreasing their reliance on grid power. Cogeneration plants eliminate much of the inefficiency characteristic of fossil fuel power plants by exploiting the waste heat produced during the generation process.

Furthermore, onsite cogeneration can provide a level of protection from grid unreliability. Because generation equipment is kept onsite with the use of a CHP system, a company is not completely at the mercy of a utility company in the event of equipment failure. Additionally, a cogeneration plant can run parallel to utility power, supplying electricity and heat in the event of a grid outage or allowing grid power to support a facility during scheduled CHP equipment maintenance or equipment failure. This redundancy is an added benefit for critical facilities.

What is Cogeneration and How Does it Work?
Cogeneration is the simultaneous production of electricity and useful heat from a single fuel source. It works by diverting the utility-supplied natural gas that would generally be used to supply a facility’s heating needs and using it instead to fuel a natural gas generator set. The waste heat from the generator is captured from the generator’s exhaust stream and engine jacket and is used to supply the facility’s heating needs.

When implemented in the right facility, a cogeneration system can dramatically reduce a company’s electricity costs without a significant increase in natural gas costs.

Can a Cogeneration Unit Supply All of My Heat and Power?
Cogeneration is generally not economically feasible as a facility’s sole source of energy. Units should instead be designed to supply a facility’s base electrical and thermal demands. This method ensures that a cogeneration system is working at optimum efficiency twenty-four hours a day; if the unit was set to meet peak energy demands, its efficiency would decrease with a decrease in load usage. In other words, a CHP unit’s advantage over grid power is only reached when most of its waste heat is being used to perform work.

Running a cogeneration system in conjunction with grid power also provides the redundancy that is essential for critical facilities. Either power source can provide electrical and thermal energy if the other is experiencing downtime.

Is a Cogeneration System Right for My Facility?
Because the efficiency of a CHP unit depends on diverting waste heat to perform work, facilities must have the need for a constant thermal load for the system to be viable. Most facilities that rely on process heating or cooling, space heating or cooling, or a boiler or chiller for any variety of uses can benefit from CHP. Operations as diverse as hospitals, universities, hotels, food processing facilities, and water treatment plants are currently using cogeneration successfully.

What About Monitoring and Maintaining a Cogeneration System?
Many companies that design cogeneration systems also provide remote monitoring software and software training. This type of technology assesses the operating condition of a CHP unit 24 hours a day, sends e-mail notifications in the event of a deficiency or failure, and allows operators to monitor and manage multiple systems from any computer with an internet connection. CHP monitoring software can be interconnected with a facility’s building management system for added convenience.

As with any machine consisting of moving parts, regularly scheduled maintenance is vital to maximizing uptime. Businesses that implement cogeneration plants would benefit from partnering with a company that specializes in generator repair and maintenance. Reputable companies offer service contracts for scheduled maintenance and retain 24-hour emergency technicians in case of catastrophic equipment failure.