Top ten tips for getting the best out of CHP

Posted by Ian Hopkins on 12-Apr-2016 10:36:53

CHP can achieve 85% efficiency and cost savings of up to 40% on network supplied electricity and heat from conventional on-site boilers. But the case for CHP must be carefully examined to maximise return on investment.



In any organisation where there  is a large heating and cooling demand, such as process industries,  hospitals, leisure centres and hotels and Universities, (CHP) can provide unbeatable cost and carbon savings.

CHP is also versatile in that it is ideal for both retrofitting and new build applications, as a replacement for old boiler plant, or to supplement new or existing boilers. CHP units can also be set up in 'island' mode to provide off-grid power and improve energy security.

Here are ten suggestions for making sure your CHP delivers on its potential.

Analyse the case for CHP

CHP isn't right for every site, so detailed analysis is the first step in assessing feasibility. This starts with a detailed understanding of energy consumption.  Power and heating plant capacity is normally dictated by maximum demand,  meaning that operation is usually at part load.

For maximum efficiency and ROI on CHP systems, high utilisation is critical, so it's important to map the minimum energy demands during the running period, as well as the maximum demands.  Seasonal differences in demand must also be factored in.

Future changes in energy usage should also be considered at this planning phase. This could include energy efficiency plans or integration of other low carbon or renewable sources, the expansion or contraction of facilities, changes in processes, operation or occupancy.

According to the Carbon Trust, CHP viability is dependent on a heat load of about 4,500 hours per year. This is equivalent to a 17-hour demand over five days per week. However, on sites with a lower heat demand, a viable case for CHP can sometimes be made. This may apply to sites where a boiler upgrade is due and the operational savings would add up, or where there is a cooling requirement.

Take great care when sizing CHP  

Under or over-sizing CHP plants is a common and costly mistake. Calculations should be carried out with full consideration to any proposed demand reduction measures.

As a general rule, the maximum size of the CHP should be limited to the electrical base load to optimise financial and carbon savings, but heat demand should also be factored in to avoid the risk of excessive heat dumping.

Remember, there is always the option to use boilers for 'top up' heat should there be occasional spikes in demand. Cooling demand is unlikely to determine CHP capacity, so the general approach would be to assess how much surplus heat is available in summer months and whether this matches the cooling demand.

If there's a mismatch in energy demand, another strategy is to use multiple CHP units instead of one larger one. This could meet peak energy demands, with one lead unit supplying the baseline needs.

Create an operating model to evaluate potential costs and savings

You should factor in varied site energy demands to accommodate the inevitable mismatch in heat and power demands. Your operating strategy may require additional heat from conventional boilers, a heat rejection facility, scope to import or export power, or modulation of CHP output.

Various operating strategies should be considered to achieve perfect optimisation, e.g. is part-load operation or heat rejection preferable to exporting power? Is night time operation worthwhile? Is thermal storage beneficial?

You also need to understand the impact of CHP on your energy supply contracts because you will buy more gas than electricity – switching around your existing profile and, perhaps, incurring penalties.

Don't waste the 'free' heat potential

Using your CHP system mainly as a source of  electrical generation and ignoring the  'free' heat potential, perhaps by rejecting heat via dry air coolers, is exceptionally wasteful. This is bad practice by designers, installers and operators since it will minimise efficiency levels and reduce carbon dioxide and cost savings.

Consider ways in which to make use of heat or consider a thermal heat store. Ensure CHP acts as the lead heat source at all times. When integrating CHP into heating systems for new build schemes, select flow and return temperatures of heating circuits to optimise operation and prevent your CHP from 'tripping' due to high return temperatures.

Consider site specific issues that might affect installation

There are a number of practicalities to address when considering CHP, such as gas and grid connections, heat rejection capability, ventilation and exhaust systems.  You should also look at planning requirements and potential noise abatement issues

Ensure your CHP is CHPQA compliant

The Combined Heat and Power Quality Assurance programme (CHPQA) is the route to financial incentives for CHP. This voluntary scheme provides a methodology for assessment of the quality of CHP systems by measuring energy efficiency and environmental performance – providing a quality index that determines whether a CHP scheme is deemed 'Good Quality' and, hence, CHPQA compliant.

As well as unlocking government incentives, such as exemption from Climate Change Levy, it's wise to achieve the required power efficiency levels  to maximise system performance and ROI.

Failure to achieve the CHPQA threshold results in a scaling back of the fuel and/or electricity that will qualify for tax benefits. There is an annual cycle of re-assessment designed to demonstrate that the scheme continues to deliver its benefits.

Implement a CHP control strategy

Design and implement a detailed control strategy that will yield the best performance - both environmentally and economically.  This should be connected to the wider building energy management system and integrated into the controller.

Implement a robust proactive maintenance and servicing strategy

However technically sound your CHP system, it will let you down if you ignore servicing and maintenance. CHP technology requires daily observation to check for good operation, which can be undertaken using a remote control and diagnostic system, or by local monitoring.  

Such checks will identify trends that could signal future problems. More detailed examination should be conducted weekly and monthly, with main services performed every six months. Oil changes may be needed every six to eight weeks (typically after 1000 to 1500 hours of operation).

Consider your funding options

There are two broad options - to invest your own money and  get all the cost and tax benefits,  but take on all the risk (on balance sheet); or use third party financing to share the benefits, minimise the risks and avoid capital expenditure (off balance sheet).

Don't forget your CHP checklist

  • Audit energy efficiency measures.
  • Correctly size the plant based on heat and power demands and use the heat potential.
  • Mitigate any site specific issues that might affect installation/
  • Review project costs and savings.
  • Ensure accreditation and compliance to meet incentives and optimise savings.
  • Implement effective control and maintenance strategies.
  • Consider all options to finance the project.

Find out more about the essential steps in selecting, specifying and operating CHP, and which sectors and applications will benefit from cogeneration technologies. Download the Essential Guide to Small Scale Combined Heat and Power.

Essential guide to small scale chp

This article was originally published in Process Industry Informer.


Topics: Energy Management

Ian Hopkins

Ian Hopkins is a technical sales professional and business leader with more than 15 years’ experience in delivering energy efficiency projects and strategy in Europe and the United States. Ian currently heads up the Sales and Marketing function as one of the board directors at ENER-G Combined Power Ltd.