A1 Energy

PA Legislative CHP Update

09.11.18 02:06 PM By Jon
Guest post by Robert Barkanic P.E., The Barkanic Group



Combined heat and power (CHP) is an efficient and clean approach to generating electric power and useful thermal energy from a single fuel source. Rather than buying electricity from a distribution company or a retail supplier, and separately combusting oil, gas or coal in an on-site boiler to produce steam or hot water, an industrial or commercial facility can use CHP to provide both services in one, energy-efficient step. The benefits of CHP are clear; improving competitiveness, reducing energy operating costs by becoming more energy efficient, and reducing environmental pollution such as greenhouse gasses, oxides of nitrogen and sulfur dioxide emissions.


Pennsylvania is already embracing CHP with over 7500 MW’s of capacity at over 12,000 sites, and the potential for more is significant. Sites range from nursing homes and hospitals to colleges and universities, to food processors and other agricultural applications to chemical, metals processing and pulp and paper to correctional facilities.


According to a 2016 DOE Study there exists close to 11,000 MW of CHP potential in Pennsylvania alone. Across the country that number is over 240,000 MW.


The state legislature, recognizing the benefits of CHP, both economic and environmental, passed the Alternative Energy Investment Act.  This Act was signed into law in July 2008 and provides for grants and loans for the utilization, development and construction of alternative and clean energy projects in the state, including CHP.   


The Pennsylvania Public Utility Commission is encouraging Electric Distribution and Natural Gas Distribution companies to support the development of CHP projects by reducing the barriers to entry within their service territories and by, for example, helping identify the federal and state incentives and funding programs available.  The PUC is also requiring the utilities to report biennially on their proposed plans to encourage CHP development including the identification of any barriers and their recommendations to reduce or eliminate them, identification of CHP systems that are or have been interconnected to the system, an estimate of the annual energy and financial savings that customers may experience over the life of the CHP system, benefits to the distribution system, the costs associated with interconnection and efforts to facilitate the ability for larger CHP systems and those not captured under the net metering regulations to meet applicable interconnection standards, to name a few.  These reports will highlight the good work that is going on in Pennsylvania and the opportunities to improve the administrative systems to enhance CHP implementation.   


So regardless of whether your interest is lowering your operating costs or environmental emissions or increasing the resiliency of your facility you should consider investigating a CHP project at your site.   


Industrial manufacturing facilities in the Chemical industry, metals processing and petroleum industry as well as the food processing industry, governmental and commercial buildings have all benefitted from CHP.  Isn’t it time you consider doing the same?  To talk about CHP opportunities at your facility please contact A1 Energy.   



Combined Heat and Power Technical Potential in the United States, US Department of Energy, March 2016