Policy Profile

Combined Heat And Power Incentives

Policy description:

Combined Heat and Power (CHP), in this context, is really a suite of policies that enable large industrial customers to install systems that boil water to produce steam (heat) and use that steam to drive a turbine generator (power), where excess steam can be used for district heating or cooling. Sometimes referred to as cogeneration, the primary benefit of CHP is very high system efficiency. Whereas separate electricity and heat generation systems may have 40-50% efficiency, CHP systems have system efficiencies in the 70-80%+ range. The fuel for CHP systems is most commonly natural gas, which can yield a climate benefit over grid power, especially considering the enhanced thermal efficiency. A key consideration in CHP deployment is identifying the right application – a constant electric and heating/cooling load. Breweries, universities, hospital complexes, are all suitable applications. Excess steam in the summertime can be used for absorption chilling for cooling loads. For more information, see the full policy brief.

Download Full Policy Brief View Policy Component Questions

  1. Does the state offer loans?
  2. Does the state offer a rebate program?
  3. Does the state offer a tax credit?
  4. Does the state offer any other type of incentive?
  5. Do the state's major utilities offer incentives?