CHP as a Greenhouse Gas Reduction Strategy

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CHP as a Greenhouse Gas Reduction Strategy

• CHP/DG and Emerging Fuels
• June 26, 2007
• Tom Frankiewicz, EPA CHP Partnership

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Overview

• Benefits of CHP
• efficiency and environmental benefits
• as part of GHG strategy
• Recognizing environmental benefits
• Monetizing environmental benefits
• Resources through the CHP Partnership and EPA

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Advantages of Combined Heat and Power (CHP)
Reducing fuel use

• More efficient than separate generation of
  electricity and heat.
• Lower operating cost. Higher efficiency
  translates to reduced fuel consumption.
• Reduces emissions of all pollutants.
  Renewably-fueled CHP is CO2 neutral.
• Increased reliability and power quality also adds
  significant value.

Reducing OM, Fuel
Monetizing Environmental Benefit
Avoiding Business Disruptions
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Efficiency Advantages of CHP
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Criteria and GHG Reductions

• Efficiency gains translate to emission
  reductions
• SO2
• NOx
• Commensurate greenhouse gas reductions.

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Greenhouse Gas Benefits of CHP- CO2
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Recognizing Environmental Benefit

• Key to encouraging CHP-DG is in recognizing its
  primary benefits
• Higher efficiency
• Onsite thermal and electrical generation (avoid
  transmission distribution losses)
• State-of-the-art technology (emission offsets)
• CHP can be most (cost) effectively installed
  during new build or boiler replacement/equipment
  upgrade.

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CHP as GHG Strategy

• Efficiency
• Can be Renewable Energy Measure
• Works in conjunction with other measures
  (efficiency, onsite power generation, renewable
  energy purchases)
• Recognized in USGBC LEED certification
• Strategy under voluntary commitments

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Benefits of Clean Energy (EE, RE, and DG)

• Economic
• Lower cost compared to new generation and
  transmission
• Downward pressure on natural gas prices
• Lower wholesale electricity prices
• Improved local economy
• Improved service to low income and seniors
• Risk Management
• Diversify a utilitys generation supply portfolio
• Reduce environmental regulatory risk to utilities
• Environmental
• Lower greenhouse gas emissions and air pollutants
• Lower water use
• Utility System Benefits
• Quick fix with longer term benefits
• Improved security of electricity and gas systems
• Lower peak demand / improved reliability

• Clean Energy includes cost-effective energy
  efficiency (EE), renewable energy (RE), and clean
  distributed generation (DG) such as combined heat
  and power (CHP).

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Environmental Revenue Streams
Definition Any number of programs that reward
clean power generation and provide one time or
ongoing revenue source.

• Emissions Programs
• Emission allowance trading programs (cap and
  trade)
• New source emission offset programs
• CO2 offset programs
• Generation Programs
• Energy portfolio standard programs
• Voluntary green power purchases

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Project Resources

• Procurement Guide
• CHP Emissions Calculator
• Funding Database

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The EPA CHP Partnership

• Voluntary program - seek to reduce the
  environmental impact of power generation by
  promoting the use of CHP.
• Actively providing education/outreach and direct
  project assistance since 2001.
• Provide services and tools for Partners to assist
  with CHP project development, regulatory
  barriers, market transformation.
• Work with government and environmental community
  to evaluate environmental benefits of CHP.

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Resources for Greenhouse Gas Strategy
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CHP Partnership
Tom Frankiewicz frankiewicz.thomas_at_epa.gov
202.343.9794 Or visit our website at
www.epa.gov/chp