Is CHP right for you?
22 October 2015, News release from Finning (UK) Ltd - Power Systems
Combined heat and power (CHP) is a well-established technology employed in numerous industrial plants both in the UK and across the globe.
With a standard power-only generation system, all heat from the engine and exhaust is rejected to the atmosphere and therefore as little as 40% of the energy from the system is being utilised. In contrast, a CHP system is set up to recover heat from the engine cooling circuit and exhaust gases, thus greatly increasing the percentage of energy being put into the process that the site can utilise, in some cases up to 88%.
Nigel Thompson, Sales Manager, Gas Power Solutions from Finning Power Systems (Finning), a provider of both natural gas and biogas CHP technologies, advises on how to evaluate CHP for a specific site application.
A background to CHP
A CHP system consists of a prime mover, such as an internal combustion gas engine to provide motive power, an electrical generator and a means of recovering heat, typically from the engine jacket cooling circuit via a plate heat exchanger and from the exhaust gas stream via a shell and tube heat exchanger. This means CHP reduces the amount of electricity the host site purchases from the grid and the amount of fuel required to generate the site heat requirements.
A variety of heat types can be recovered from a CHP including low temperature hot water (LTHW), medium temperature hot water (MTHW), steam and, in the case of Tri- Generation or combined cooling, heating and power (CCHP), chilled water. Tri-Generation can be particularly attractive for those sites with little or no summer heat load but which have a cooling load.
The benefits of investing in CHP
CHP can represent a sound financial investment for many applications. As well as offering operators a range of tax incentives, such as enhanced capital allowances and certain business rate exemptions, CHP also offers low cost of ownership compared to other capital investment in plant and equipment.
As a general rule, operators should expect payback within three to four years, depending on the difference between their gas and electricity supply prices. The higher and more constant the demand for power and heat, the greater the achievable savings and the quicker the scheme achieves payback.
CHP is also a sustainable option for businesses keen to improve their environmental credentials. Compared to traditional methods of using a combination of power from the grid and on site boilers, CHP provides significant carbon reductions which improve the site's environmental performance.
Before commissioning the installation of a CHP package, operators should first carry out a feasibility study and general site survey to ensure suitability and to make any necessary modification to site infrastructure.
The likelihood is that there will be a natural gas line in to the site, in which case, it is important to assess whether there is sufficient pressure and if the supply is interruptible as well as the volume requirement for gas, as CHP actually increases the amount of gas consumed.
Next, operators should establish site demands for power, heat, steam and cooling - whether this is continuous or cyclical and whether this may increase or decrease over the next five years.
CHP installations should normally be sized to meet the base load consumption. It is important that this is based on the demand profile during a full production year to account for peaks and troughs in output and that it includes an assessment of yearly gas and electricity bills.
This will enable a power-to-heat ratio to be calculated. For example, a site may require 500 kW of heat and 500 kW of electricity to operate to maximum production output. In a conventional installation, the heat will be provided by a series of gas boilers and the electricity purchased directly from the grid.
In contrast, a CHP installation may produce 400 KWe of heat and electricity respectively from one natural gas fuel source, meaning that the operator can significantly reduce its utility costs, importing only the additional power it needs above the 400kWe base.
It is also worth noting that some distribution network operators (DNOs) may raise their tariff if the site reduces its consumption, so this needs to be factored in to the overall equation.
In some instances, to achieve the power-to-heat ratio necessary, it can be more economic to oversize the package to deliver slightly more power than the base load requirement, with the option to sell any excess electricity generated back to the grid at a profit. In other applications, it can be more profitable to size to the building's lowest average heat demand, with the CHP system acting as the lead boiler and backup boilers picking up additional heat requirements.
This initial feasibility study will enable the operator to establish whether the site is viable for CHP or, if it currently does not look favourable, whether to revisit the concept in three-to-four years' time when requirements may have changed.
If the decision is made to proceed, then there are a number of technical factors that also need to be considered, such as whether the CHP plant will be installed inside or outside and whether there are any noise restrictions that must be adhered to.
Finally, it is important to account for the site operating regime, including the number of operating hours and over what period of time as this will affect any operating and maintenance (O&M) contract that is entered in to.
In conclusion, purchasing a CHP unit is not the same as buying a diesel generator set. The CHP must be configured precisely to meet each site's requirements, offering high reliability, durability and electrical efficiency. It is a long-term investment and therefore, there should be a trusting partnership in place between the operator and the supplier, who, ideally, should be required to meet contractual obligations for the ongoing operation and maintenance of the equipment for many years to come.
For further information please email Finning (UK) Ltd - Power Systems