Energy Efficiency - CHP Overview Cogeneration (CHP): Why it matters

America. CHP systems neatly address two main challenges: (1) the amount of thermal energy used by consumers is higher than generally recognized, and not usually the focus of renewable technologies, (2) centralized electricity production is very inefficient, producing vast amounts of waste heat.

“Sustainable energy” is frequently associated with reducing electricity consumption, and/or implementing renewable electricity generation, such as solar panels or wind turbines. These are important factors in reducing carbon emissions, yet it is also critical to take thermal energy use into account. In the US, electrical energy use only accounts for 21% of total final energy consumption, i.e. energy consumed at the point of the end-user. The percentage of final energy consumed for thermal needs is generally greater than that of electricity. (U.S. Final Energy Consumption (2012) (U.S. EIA)) Far less focus is placed on providing for these thermal needs through renewable energy sources.

The key problem with electricity is that though it accounts for a reasonably smaller percentage of final energy end-use, the current process of generating electricity is very inefficient, and consumes a vast amount of primary energy input. On average, 68% of the primary energy used in a central electricity plant is lost as waste heat, and only 32% is converted to electricity. Thus electricity generation has a far greater footprint than is indicated by looking at the amount of electricity consumed by the end-user. For example: for every unit energy of electricity delivered to a commercial building, three units of energy have been consumed at the power plant to supply it.

The standard method used in centralized main-grid power stations is to create heat (via coal, natural gas or nuclear reactor) to produce steam, turning turbines to spin generators. Though electricity can be transported long distances over high-voltage power lines, thermal energy dissipates far more quickly and cannot be transmitted over long distances. Since a majority of centralized power stations are located away from population centres, the heat created to drive the electrical generation process must be released to the atmosphere, through cooling towers, flue gas, or by other means. To illustrate how much energy is wasted, one can compare the total amount of energy lost as waste heat by the electrical generation process to energy used in other sectors of society. (See Fig. 2) The energy lost as waste heat represents almost as much as is consumed by the transportation sector, and slightly more than is used by the industrial sector. This large amount of waste heat represents a huge un-tapped resource for fulfilling the thermal needs of society, if it can be generated closer to the point of consumption. Fortunately, deployment of cogeneration technology can help recapture this waste heat, both increasing the efficiency of electrical power generation, and servicing thermal energy needs currently addressed by additional fuel consumption.

Figure 2. Energy lost in the Electric Power Generation Sector Compared to other Sectors of Society

A Huge Waste of Energy

Waste Heat from Thermal Power Plants equals all the energy used for transportation or by industry in North America

Few people are aware that the first electrical power plant set up by Thomas Edison was actually far more efficient than the centralized power plants of today. His power plant was located inside New York City. Due to the proximity of buildings he was able to set up a district heating line to use the waste heat from electricity generation for space heating and domestic hot water. Because CHP can capture and make use of electricity and heat, well-designed CHP system are able to get far more work out of the primary drive energy. CHP systems typically operate at 80-90% efficiency, vs. 32% for centralized power stations. (See Fig. 3.)

Fig 3. Energy Saved through use of CHP systems.

Oak Ridge National Laboratory (part of the U.S. Dept. of Energy) completed an analysis to determine the effect of wide-spread CHP adoption, and calculated the impact it would have if just 20% of the generating capacity of the U.S. came from CHP units deployed within commercial buildings. The results were impressive:

  • A 60% reduction in projected increase of carbon dioxide emissions vs. business as usual

  • Fuel conservation of 5.3 quadrillion British thermal units (BTU) annually,

  • A 23% reduction in the overall U.S. energy demand

  • CHP also results in significant water conservation vs. central power plants, since CHP systems don’t need to employ large water-cooling towers to remove the waste heat from the system

The threshold to achieve 20% of generating capacity from CHP is not an unrealistic goal. In other places, CHP is a well-established technology. In Europe, the higher cost of energy has caused wide CHP deployment. In countries such as Norway, Denmark, Finland and Russia, cogeneration accounts for over 30% of electrical generation. According to the International Energy Agency’s “Combined Heat and Power – Evaluating the benefits of greater global investment,” CHP accounts for 9% of global power production. CHP adoption is not as advanced in North America, but has been growing rapidly. Continuously rising electrical costs and a strained, less reliable grid are accelerating adoption of CHP. This trend benefits both individual CHP owners as well as society as a whole.

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Alberta, Canada