As a CHP solution provider, I’ve heard all the concerns under the sun against CHP. Some warranted, some not. I’d like to address the 5 most common myths that I hear from across the table.
Myth 1: CHP is only for large facilities
Not at all! Many CHP suppliers offer products in the kW range, as low as 8 kW (enough to power your house). A 50 kW unit could easily fit in a janitor’s closet, so don’t let anyone tell you your facility is too small. It all depends on how you consume and use heat. Hotels and senior living centers are great examples of smaller facilities that use a great deal of heat year-round for things such as heating swimming pools, space heating, and laundry.
Myth 2: Spark spread is the only factor that matters.
Not necessarily. Spark spread is the difference between electric rates versus natural gas rates. Although it is certainly a key indicator, it is not the only factor that matters. If your engineering consultant gives this as the only reason not investigate further, get a new consultant. For instance, a strategically located DER asset can defer transmission and distribution upgrades that can be magnitudes more in avoided costs than the DER project itself. Talk with your utility provider to gauge their interest. CHP can also defer boiler or chiller capital purchases to future years. And what about your cost of disruption? What is the value of keeping the lights on during an electric outage? A hospital would certainly benefit during natural disasters, but even manufacturer’s at the end of a distribution line may benefit. Instead of wasting a day’s worth of work because of a hour outage, CHP can ride through outages and keep your business going. There is value in that. So spark spread is a key indicator, but it is not the only thing that matters.
Myth 3: If natural gas prices rise, my CHP will cost me more.
Quite the contrary. In the U.S. about half of our generation capacity is fueled by natural gas and much of that serves the fluctuations in the demand for electricity. Coal plants are being decommissioned. Renewables run when they can. Nuclear is base loaded since we don’t “turn them down” if demand drops. That leaves natural gas to play the “peaker” role. They ramp up or down depending on the demand. This means that if natural gas price rises, the cost to generate our electricity will certainly rise with it. Since more and more solar is being deployed, natural gas will serve more and more of the peak demand, so our electric rates may even rise more than dollar for dollar versus natural gas. At the end of the day, CHP is about being more efficient with each unit of energy consumed whether it’s kWs or BTUs.
Myth 4: I need sophisticated controls in my facility before I can use CHP.
Not to worry! Today’s packaged CHP systems are commonly self-sufficient. With their many sensors and gauges, the systems will safely start up, ramp up, ramp down, or shut down when needed. They can dump the heat automatically if the customer can’t accept any more heat. There is even remote monitoring so that issues can be diagnosed from afar.
Myth 5: I don’t want to be the first mover.
Trust me, you are not the first mover. CHP and cogeneration has been around for over 100 years. According to the U.S. DOE, there are over 82.6 GW of installed CHP at over 4,000 sites across the country. And that is only the self-reported installations. Needless to say, CHP has been done before in your industry and probably at a very similar facility as yours.
Let us know if we can help you overcome your concerns.