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Updated: October 26, 2020

Combined heat-and-power may be an energy market with promise in Maine

Screenshot / Courtesy, E2Tech Clockwise from top left, E2Tech’s Marty Grohman and Adelaide Taylor, Energy Solutions Center’s Eric Burgis, University of Maine’s David Dvorak, Efficiency Maine’s Ian Burnes, and Summit Utilities’ Lizzy Reinholt discuss the benefits of the emerging combined heat and power production market.

Maine may be a prime candidate for emerging technologies associated with “micro combined heat and power production,” or microCHP.

That’s because Maine, and the rest of New England, hit several criteria considered key to achieving the greater efficiencies and lower costs through microCHP compared with conventional power production.

Eric Burgis, director of commercial markets at the Energy Solutions Center in Washington, D.C., provided a review of the status of microCHP technologies during an Oct. 20 webinar on emerging markets for combined heat and power, hosted by E2Tech in Portland.

E2Tech is a member-based organization focused on energy solutions.

Combined heat and power is defined as the use of on-site power generation to provide both electricity and heat at the same time, from a single fuel source such as biomass or natural gas. 

The technology compares with conventional power sourcing through dual systems, such as purchasing electricity from the grid and producing heat with a furnace or boiler.

The CHP process is considered more fuel-efficient than a conventional power plant because otherwise-wasted heat can be used in a productive manner such as space heating. Onsite production is considered to increase energy security and resiliency because it reduces the need to purchase electricity from the distribution grid.

In 2017, the University of Maine was designated to lead one of 10 U.S. Department of Energy CHP technical assistance partnerships dedicated to promotion, technical support and deployment of cost-effective and efficient CHP technologies throughout the nation. UMaine leads the New England partnership.

“MicroCHP” cogeneration systems, which are less than or equal to 50 kilowatts in size, operate on a smaller scale than CHP cogeneration systems. MicroCHP systems, used for residential and smaller commercial applications, generate heat as the main output and electricity as the byproduct. Larger CHP systems, for large-scale use, generate electricity as the main output and heat as a byproduct. 

According to Burgis, microCHP systems can achieve 85% efficiency for home and business heat and electrical needs, compared with an average 51% efficiency obtaining heat and electricity from a conventional powerplant and furnace or boiler. And microCHP systems need less fuel to do so, he explained.

Spark spread

In determining ideal markets for microCHP technology, Burgis said leading criteria include “spark spread,” which is the difference between the wholesale market price of electricity and its cost of production using natural gas.

“In general, we are looking for electric prices that are 2.5 to 6 times the cost of natural gas,” he said in his presentation.

Other criteria include states that have interconnection and net metering policies for CHP, and states or utilities that have incentives for CHP installations.

Most of the New England states meet most of the criteria, and therefore would see favorable returns on investment in the technology, he said.

Burgis said a study conducted by his organization several years ago, comparing microCHP with renewable energy sources, showed microCHP to require a larger initial investment but resulted in greater overall savings and far fewer CO2 emissions.

One of his hypothetical examples was a 12,000-square-foot fitness center. The installed cost for solar panels was $5,300; wind turbine $6,000; and microCHP $7,280.

But the annual savings for solar was $156, wind $216, and microCHP $592. MicroCHP kept CO2 emissions down by a factor of four over solar and wind.

Emerging technology

The technology for microCHP is still emerging, he added. That includes reciprocating engines, combustion or steam turbines, and fuel cells, as well as batteries for energy storage.

Lizzy Reinholt, senior director of sustainability and corporate affairs for Summit Utilities, said her company was encouraged by the latest recommendations, from the Maine Climate Council’s energy working group, that encourage the development of CHP facilities.

David Dvorak, a University of Maine professor of mechanical engineering technology and director of the New England CHP technical assistance partnership with the U.S. Department of Energy, said current CHP installations across the U.S. account for 80.7 gigawatts of energy at 4,600 facilities, mostly large-scale industrial and commercial operations. 

Courtesy / University of Maine
Seen here in 2017 is a combined heat and power plant at the University of Maine. The 300 kilowatt steam turbine generator converts excess steam from UMaine’s steam plant to produce electricity.

“But we’re seeing additional markets,” he said. In the past four years, of 793 installations, there have been quite a few smaller-scale systems.

Emerging markets include commercial facilities such as hotels, office buildings, retail and restaurants; institutional facilities such as hospitals and schools; and agricultural facilities such as dairy farms and greenhouses.

But the market for small-scale systems is hampered, he said, by limited CHP experience and limited technical resources by end-users, a history of issues with system performance and with CHP sales and service support, and by perceived risks on the part of both energy consumers and suppliers.

User-friendly catalog

As a result, the Department of Energy is developing a national web‐based catalog, or eCatalog, for end‐users and vendors, that lists CHP suppliers that assemble, install or service packaged CHP systems, as well as state and utility partners that provide CHP market deployment programs. 

The e-catalogue is designed to be user-friendly, said Dvorak. It provides project snapshots, such as one at the Army Aviation Support Facility in Bangor, where a 75-kilowatt CHP reciprocating engine system, using natural gas, was installed in 2015 and has resulted in average annual savings near $60,000 and reduces the facility’s CO2 emissions by bout 100 tons per year.

What will be make the greatest difference in promotion the technology on a larger scale?

“Getting the word out to these emerging markets,” said Dvorak. “A big part of the challenge is explaining to these emerging markets that they’re part of an emerging market because they’re not necessarily used to thinking in this way.”

Ian Burnes, director of strategic initiatives at efficiency Maine noted that, several years ago, the agency offered a 75% incentive for CHP installations to jumpstart the market.

“It was a limited time offer,” he said. “We did a bunch of systems; then the interest receded. The package systems are a great innovation. But we’ve got to bring the costs down. That’s the bottom line.”

Reinholt said incentive programs such as Efficiency Maine’s will be important to building the microCHP market. 

Said Dvorak, “When we look at emerging technologies, a lot of times it’s actually existing technologies that are emerging into an area where it hasn’t previously been considered. If we can  put tools into the hands of folks or give them the information and guide them along the way, that’s a big part of what we’re trying to do.”

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