Combined Heat and Power

Combined Heat and Power
Energy University Course Transcript

Slide 1
Welcome to Combined Heat and Power.
Slide 2
In order to fully appreciate this topic, you need to understand how energy is billed. Factor such as demand,
demand ratchet and time of use all have an impact on the potential returns from your combined heat and
power strategy. If you do not have knowledge of these topics, please take Energy Rate Structures I and II
first.
Slide 3
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normal play of the course. Click the paperclip icon to download supplemental information for this course.
Click the Notes tab to read a transcript of the narration.
Slide 4
At the completion of this course, you will be able to:
 Define what cogeneration is along with the primary fuels used in its creation
 Identify the different approaches for applying technology to the function of cogeneration, and you
will be able to
 Discuss the various factors to consider when evaluating the use of a Combined Heat and Power
(CHP) plant
Slide 5
Cogeneration today is widely used throughout the world for efficient production of heat and power.
Cogeneration is the simultaneous production of heat and power in a single thermodynamic process. The
purpose of this course is to review the different approaches for applying technologies to the function of
cogeneration.
©2010 Schneider Electric. All rights reserved. All trademarks provided are the property of their respective owners.
We’ll also explore the various issues and considerations for deployment of the main types of cogeneration
concepts: "Topping Cycle” plants (including “Combined Cycle” plants) and "Bottoming Cycle" plants. Let’s
begin with a brief discussion of why we would want to use cogeneration in our operations today.
Slide 6
Why are we taking a look at cogeneration? Cogeneration has the opportunity to:
 Improve system reliability and availability—especially when CHP is used as a primary source of
energy and the utility systems are used as reliable back-up sources
 Improve system efficiency—as compared to typical power generation without useful heat recovery,
and
 Reduce total operating costs—as compared to purchasing or generating electricity and heat energy
in separate systems
Slide 7
Cogeneration, goes by several names. It is also known as “combined heat and power” (CHP), cogen, total
energy, and combined cycle. Its simple definition is the simultaneous production of heat (usually in the form
of hot water and/or steam) and power, utilizing one primary fuel. Cogeneration is the use of a heat engine or
a power station to simultaneously generate both useful mechanical and useful thermal energy. Mechanical
energy is frequently used to turn a generator producing electrical energy. Thermal energy can also be used
to generate cooling—for example in the case of an absorption chiller.
Slide 8
There are four broad categories for cogeneration applications:
 Small-scale cogeneration schemes, usually designed to meet space and water heating
requirements in buildings—based on spark ignition reciprocating engines
 Large-scale cogeneration schemes, usually associated with steam raising in industrial and large
building applications—based on compression ignition reciprocating engines, steam turbines or gas
turbines
 Large scale cogeneration schemes for district heating—based around a power station or waste
incinerator with heat recovery supplying a local heating network
 Cogeneration schemes fuelled by renewable energy sources—which may be at any scale
Slide 9
Primary fuels commonly used in cogeneration include natural gas, oil, diesel fuel, propane, coal, wood,
wood-waste, and bio-mass. These "primary" fuels are used in a cycle such as the steam cycle for steam
production in a boiler, the Otto-cycle in a reciprocating engine, or the Brayton cycle in a gas turbine. The
steam produced from a boiler can be used in a Rankine cycle to produce mechanical power which can be
used to make electricity. The Otto and Brayton cycles produce mechanical energy which can be used to
make electricity. Simple cycles do not co-generate but only produce one form of energy like electricity or
mechanical power. This is why electricity created from a simple cycle, when compared on a Btu to Btu or
joule to joule basis, is typically three to four times more expensive than primary fuels such as natural gas.
Let’s explore this cogeneration technology a little bit more closely.
Slide 10
A cogeneration plant consists of four basic elements:
• Prime mover (engine)
• Electricity generator
• Heat recovery system, and
• Control system
A typical cogeneration system consists of an engine, steam turbine, or combustion turbine that drives an
electric generator. A waste heat exchanger recovers waste heat from the engine and/or exhaust gas to
produce hot water or steam all managed by the control system. Cogeneration produces a given amount of
electric power and process heat with 10% to 30% less fuel than it takes to produce the electricity and
process heat separately.
When it comes to cogeneration, there

are two main concepts: "Topping
Cycle" (including Combined Cycle)
plants, and "Bottoming Cycle" plants,
so let’s investigate these concepts
next.
Slide 11
In a typical topping cycle plant, mechanical energy or electricity is produced first and heat is then used for a
useful heating process, or as energy for a different useful cycle such as to make cold water using an
absorption chiller.
There are various types of topping cycle cogeneration systems:

 Steam-turbine topping system
 Engine-driven electric-generator topping system
 Gas-turbine topping system which can also be a combined-cycle topping system when used with a
steam-turbine generator, or other process cycle
Let’s discuss each one in more depth.
Slide 12
In a steam topping cycle, steam is produced for a process but is usually generated at a higher pressure than
is needed. The steam is then passed through a let-down steam turbine (such as a Rankine Cycle) to make
mechanical power which can be used to make electricity. Steam exhausting the turbine is then used for
processes heating or cooling.
Another type of topping cycle system consists of an engine-driven electric generator in which the engine
jacket cooling water (the water that absorbs the excess emitted heat from an engine) is run through a heat
recovery system to generate steam or hot water for space heating.
In a combined-cycle process, a gas turbine (such as a Brayton Cycle) can be used to make mechanical
energy or electricity first. Waste heat from the gas turbine exhaust can be used to make steam in a heat
recovery steam generator or HRSG. This steam can be used in a steam turbine (Rankine Cycle) for power
production or the steam may be used in process heating.
Slide 13
A topping cycle cogeneration plant always uses some additional fuel, beyond what is needed for
manufacturing, so there is an operating cost associated with the power production. Facilities that generate
electrical power may produce the electricity for their own use, and then sell any excess power to a utility.
Slide 14
Conversely, bottoming cycle plants are much less common than topping cycle plants. These plants exist in
heavy industries such as glass or metals manufacturing where very high temperature furnaces are used. A
waste heat recovery boiler captures waste heat from a manufacturing process. This waste heat is then used
to produce steam that drives a steam turbine to produce electricity. Since fuel is burned first in the
production process, no extra fuel is required to produce electricity.
Slide 15
An emerging technology that has cogeneration possibilities is the fuel cell. A fuel cell is a device that
converts hydrogen to electricity without combustion. Heat is also produced. Most fuel cells use natural gas
(composed mainly of methane) as the source of hydrogen.
The first commercial availability of fuel cell technology was the phosphoric acid fuel cell, which has been on
the market for a few years.
Slide 16
According to Fuel Cells 2000, more than 2500 fuel cell systems have been installed all over the world, and
with the Kyoto Protocol we expect to see more countries adopting fuel cell technology for the purposes of
cogeneration.
Other fuel cell technologies—such as molten carbonate and solid oxide—are in early stages of development.
Solid oxide fuel cells (SOFCs) may be potential source for cogeneration, due to the high temperature heat
generated by their operation.
Slide 17
While cogeneration provides several environmental benefits by making use of waste heat and waste
products, air pollution is a concern any time fossil fuels or bio-mass are burned. The major regulated
pollutants include particulates, sulfur dioxide (SO2), and nitrous oxides (NOx). Water quality, while a lesser
concern, can also be a problem. New cogeneration plants are typically subject to a state or country level
environmental permit process designed to meet ambient air quality standards established by individual
states and/or countries. Keep in mind that adhering to air quality standards can add significantly to the initial
cost of some cogeneration facilities located in urban areas.
Slide 18
It’s important to consider that some cogeneration systems, such as diesel engines, do not capture as much
waste heat as other systems. Others may not be able to use all the thermal energy that they produce. They
are therefore less efficient, and the corresponding environmental benefits are less than they could be.
The environmental impacts of air and water pollution and waste disposal tend to be very site-specific for
cogeneration.
This is a problem for some cogeneration plants because the special equipment—such as water treatment,
air scrubbers, etcetera—required to meet environmental regulations adds to the cost of the project.
If, on the other hand, pollution control equipment is required for the primary industrial or commercial process
anyway, cogeneration can be economically attractive.
Now let’s move on and discuss the various considerations for applying CHP plants.
Slide 19
As electricity demands rise worldwide and as steam and utility systems in industrial plants age and require
repair and replacement, opportunities present themselves for the use of CHP plants that can serve the
industrial complex. These CHP plants can provide electricity use economically and in an environmentally
friendly manner.
In evaluating the use of a CHP plant, there are several factors to keep in consideration including:
 Capital utilization / productivity
 Local electricity rates
 Efficiency gains versus fuel prices
 Steam load versus electric load
 Reliability requirements (steam and electric)
 Fuel availability and selection, as well as any
 Staffing and training needed
Let’s explore each of these in more depth.
Slide 20
A concept to consider in evaluating CHP is “fuel chargeable to power.” Fuel chargeable to power (FCP) is
actually an inverse of efficiency in terms of heat rate expressed in the units Btu/kWh –or in SI units, this
energy flow is referred to as kJ/kWh. The heat in the steam to process is credited to the fuel to determine
the remaining fuel that is allocated to power. The formula is as follows:
The cost of the fuel chargeable to power is taken into account along with other costs when the system is
evaluated.
Slide 21
Another cost consideration is the capital productivity of the plant. This factor considers the cost of the plant
construction compared to the average thermal and electric output of the plant. This factor is decreased by
reducing capital costs, increasing the capacity factor, or fully utilizing the plant.
Capacity factor is defined as the average load over a defined time period divided by the design capacity of
the plant. A CHP plant with a capacity factor of 40% has a capital productivity factor double that of a plant
with an average capacity factor of 80%.
Slide 22
A plant designed for a load with significant variability of steam and electricity not only suffers from thermal
inefficiencies, but also results in a higher cost of capital on each unit of currency per energy unit
basis. Once again, economic considerations are the drivers towards designing the plant to meet average
loads for lowest capital cost and utilizing secondary sources to meet remaining demands.
Slide 23
Several factors influence design decisions of a CHP plant. Aspects to weigh include:
 The cost of electricity
 The cost of fuel
 Any backup electric sources needed, as well as
 Excess electric generating capabilities
Of all of these, the cost of local electricity rates will have the biggest influence. The costs of electricity must
be evaluated taking into account the demand and energy portion of the electric rates. Some electric utility
companies have electric tariff rate structures that deter the development of CHP plants by their customers.
Slide 24
These are often called “cogen buster” rates, and add sizable complications to making CHP plants
economically feasible when remaining tied to the electric utility for supplemental or backup services.
To successfully calculate the “all in” costs of electricity with the CHP plant it is necessary to have a through
grasp of the following:
 Electric load profile of the load it is serving
 Expected generating capabilities of the plant
 Its relationship to steam loads, as well as the
 Utility rates available from the local utility for supplemental power and backup power
Slide 25
Due to the fact that cogeneration is the generation of both electric and steam, CHP plants are best suited to
serve loads where the electric and steam loads are closely related. The CHP plant will generate a fixed
amount of electricity when meeting a given steam demand, or the plant will provide heat to generate a fixed
steam supply when generating a given electric load.
Slide 26
If it is incorporated in the initial design, supplemental fuel can be combined to generate additional steam
without increasing electric output.
If the CHP plant includes a condensing steam turbine generator, supplemental electricity can be generated
by condensing steam at a loss in CHP efficiency.
In cases where electric loads and steam loads are not closely related, the CHP plant performance is often
inefficient and the plant is underutilized due to supplemental electric purchases and supplemental fuel use.
Slide 27
The “all in” cost of electricity is shown in this equation:
The cost to produce electricity from the CHP plant is determined based on the fuel charged to power as
discussed previously.
The capacity of the CHP plant may vary seasonally or daily due to ambient conditions or based on the
process steam demands. The plant design will drive capacity. Expected supplemental electricity and
excess electricity can be determined by overlaying the CHP plant electric supply profile with the process
plant electricity demand.
Slide 28
The electricity demand seen by the utility must be evaluated considering peak requirements and variations
in the electricity supply capacity.
As we learned in the Energy Rate Structures courses, electricity utility companies often will have demand
“ratchets” built into their rate structure. Once the increased demand is recorded at the meter, the customer is
then billed for that demand for a defined period.
This can become quite costly to the customer, as the demand ratchet—which is a new, more costly rate—is
billed whether or not the meter sees that demand for the remainder of the ratchet time period.
Slide 29
The utility supplier of additional electricity defines the cost of this supplemental power. It will also determine
the utility credits (which may translate into a revenue stream for the customer) for any excess electricity sold
to the utility grid. The local utility company will typically have stringent requirements for operating a
generator in parallel with its electric service and for interconnecting to the utility grid. If the CHP plant
encounters reliability issues, the plant will result in backup electricity costs due to forced outages. Backup
charges can be very costly. When considering CHP plant installation it is imperative to have a clear
understanding of the cost impact as well as the potential of these external sales and purchases.
Slide 30
The high efficiencies, reduced emissions, and fuel use are attractive enticements to switch to cogeneration
from traditional paths. However, fuel source is a significant cost driver even with the large efficiency
gains. Replacement of a retiring coal-fired steam plant with a new state-of-the-art, gas-fired CHP plant may
not be the most cost-effective approach. Even with a reduction in fuel usage of 30%—for the same thermal
output, the price for natural gas compared to coal is even more significant. The result can be a greater total
fuel cost with CHP. The economic analysis of the plant must include a full comparison of costs for electricity
and steam. Volatility of fuel prices and electric prices can make the analysis difficult. Capital project needs,
existing system reliability, and other drivers often influence the final decisions to implement a CHP plant.
Slide 31
In defining a CHP plant, it is important to understand the steam and electricity demands of the plant. Our
goal is to balance the demands and variability of the steam supply with the demands and variability of the
electricity generation from an economic perspective. The optimum match—from an efficiency
consideration—is to match electricity generation with the process steam demand. In this case, the steam
turbine is fully utilized as it produces electricity in an efficient cogeneration cycle.
Slide 32
When considering a steam generator or boiler to supply steam to a steam turbine electric generator, the
best efficiency is realized if all of the steam supplied to the turbine is used for a useful heating
process. Exhaust steam from the turbine going to a surface condenser instead of a heating process is not
efficient cogeneration.
Slide 33
In the case of a gas turbine / Heat Recovery System Generator (HRSG) plant, the exhaust gas stream from
the gas turbine when operating at its rated capacity for electric generation is supplied to a HRSG to convert
the heat from the gas into steam for process use. Additional steam can be produced by the addition of heat
to the gas turbine exhaust through the use of duct burners. Duct burners are an efficient means of
increasing the output of steam from the HRSG to optimize efficiency.
Slide 34
In both of these cases, electricity and steam loads must match the chosen equipment configuration. If the
equipment produces less than the full needs of the facility, a second source of electricity or steam is
necessary to meet the required demand. A surplus of power or steam requires a sink—such as the
electrical utility grid or a second steam customer.
Slide 35
It is relatively easy to optimize a CHP system design for a given steam and electrical demand. The difficulty,
however, comes with the variability of steam and electrical demand and is even more difficult when those
variations are not closely correlated.
Because of this, it may be more cost effective to design the CHP plant for an optimum—typically lower—
match of steam and electric, and use secondary sources of steam and electricity to meet surplus demand.
Slide 36
Steam and electricity load reliability requirements must be factored into any design basis for a CHP
plant. Because a CHP combines both steam and electricity production from one plant, the loss of
production of one commodity can also mean the loss of the other.
Simply put, a mechanical failure resulting in the loss of steam production can also mean a loss in electric
supply capability. The length of any allowable interruption must also be considered—because for some
process plants—a short 15-minute interruption in steam or electricity may result in weeks or months of lost
production to the host process plant.
Slide 37
Depending on the level of criticality (meaning how critical the use of the steam is) either a redundant source
is kept on-line in parallel with the CHP or a redundant, stand-by CHP system is installed in parallel. Keep in
mind that a redundant CHP plant usually results in plant inefficiencies—as previously discussed. Moreover,
redundant CHP plants are extremely expensive to build. Electricity usually requires an instantaneous back-
up source. The most reliable and stable source of backup is typically the local utility grid. Alternatives, such
as redundant CHP units in parallel are feasible, but the economics and reliability (of a parallel plant) will still
usually lean the developers in favor of the utility grid.
Slide 38
While almost any fuel is suitable for cogeneration, in practice, fossil fuels—especially natural gas—
predominate. This is due to economical and environmental factors. However, municipal solid waste, certain
industrial gases and bio-mass may also be considered as viable fuels. In fact, over time bio-mass and
derived gases are likely to take the place that natural gas occupies now, as the technology becomes more
available and cheaper and as environmental concerns increase.
Slide 39
For example, installations may be designed to accept more than one fuel as they are in Turkey, where LPG
or naphtha are used as stand-by fuels in case the gas supply is cut-off. Another example, in the UK (United
Kingdom), is dual-fuel gas/fuel oil burning, where natural gas is bought at the lower-rate interruptible tariff
and is replaced with fuel oil when gas supply is interrupted during periods of peak demand.
Slide 40
In some cases, cogeneration may be engineered to accept three or more different types of fuels—this
allows the operator to select the cheapest fuel. Key factors in the choice of fuel are possible incentives
offered for their consumption and the quality of the fuel.
Some countries offer incentives for the use of better quality fuels, such as natural gas, bio-mass or bio-gas.
Low-quality fuels are sometimes cheap—although this varies for country to country—but they incur
significant extra costs (on-costs) for handling and burning and to meet environmental regulations. Good
quality fuels are more expensive but have fewer or no on-costs.
Slide 41
Fuels may be solid, liquid or gaseous, and either "commercial" or "waste". Commercial fuels are fossil fuels
that are extracted and treated or refined and sold nationwide. Waste fuels are by-products or adjuncts of
processing. Renewable energy fuels are not normally traded commercially so are usually only economically
available in specific locations.
Slide 42
The complex and interdisciplinary issues involved in cogeneration projects require qualified staff for
operations—to not only bring the plant on line—but to also oversee the daily operations and maintenance.
These activities usually require a high level of experience and skills, which may not be found in the ranks of
an industrial company’s existing staff. Staffing and training is an additional factor that is best considered
upfront rather than just before start-up of the new facility. As we discussed previously, incurring reliability
deficits can be extremely costly to a company. The likelihood of underperformance occurring dramatically
increases when employing under skilled workers in a CHP plant.
Slide 43
An alternative approach is to implement a CHP plant through a third party energy service provider. By using
an outsourcing approach you can accelerate the learning curve. Staff can acquire the necessary skills
through the training provided by an energy service provider with experience in CHP systems and
equipment. A qualified energy partner may also be able to provide services in:
The design and construction of the CHP plant, as well as
 Operations and maintenance services
 Financing, and possible
 Ownership or lease back of the plant
Slide 44
It is important to point out that regardless of the approach to operations and maintenance, it is important to
consider:
 The change in required skill sets
 Available talent, and
 Costs to successfully meet the energy demands of the host site with a new CHP plant
On-going training should also focus on areas of strategic importance such as:
 Cost reduction
 Improved reliability, availability and maintainability
 Materials
 High temperature thermal barrier coatings
 Life duration
 Fuels
 Emissions control, as well as
 Measurement and verification
Slide 45
Here we see a comparison of the different CHP technologies provided by the US Department of Energy.
Now, let’s wrap up with a brief summary.
Slide 46
Today, we defined cogeneration as the simultaneous production of heat and power in a single
thermodynamic process. We also discussed and compared the primary fuels used in its creation which
include natural gas, oil, diesel fuel, propane, coal, wood, wood-waste and bio-mass.
 Time was also spent identifying the different approaches for applying technology to the function of
cogeneration, specifically, "Topping Cycle" (including Combined Cycle) plants, and "Bottoming
Cycle" plants. We also had an in depth discussion on the various factors to consider when
evaluating the use of a Combined Heat and Power (CHP) plant including:
 Capital utilization / productivity
 Local electricity rates
 Efficiency gains versus fuel prices
 Steam load versus electric load
 Reliability requirements
 Fuel availability and selection, as well as any
 Staffing and training needed
Finally, we reviewed a comparison chart of the different CHP technologies discussed.
Slide 47
Thank you for participating in this course.

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Energy University Course Transcript

When it comes to cogeneration, there

There are various types of topping cycle cogeneration systems:

Let’s discuss each one in more depth.

Let’s explore each of these in more depth.

Now, let’s wrap up with a brief summary.

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