FEMP Examines Market Assessment of CHP Projects

November 1, 2002

Combined heat and power (CHP) installations are gaining attention as a technology that can improve the quality, reliability, and security of power systems at Federal facilities while also helping to meet Federal energy efficiency goals. FEMP's market assessment indicates that CHP (also known as cooling, heating, and power; or cogeneration) systems could be successfully applied in 9 percent of large Federal facilities, in projects that would have an average simple payback of 7 years. These installations could annually conserve 50 trillion Btu, reduce carbon dioxide emissions by 2.7 million metric tons, and save the Federal government $170 million per year in energy costs.

Federal agencies have just begun to tap the potential of CHP systems, but more Federal energy managers are learning the benefits of these systems. Through "ADD CHP", Accelerated Development and Deployment of CHP at Federal sites, FEMP is responding to numerous requests for assistance and information from agencies interested in CHP. Also Federal agencies have begun to finance CHP projects through energy savings performance contracts, utility energy service contracts, or other financing vehicles.

More than 50 Federal sites already have CHP systems, and another 50 sites are pursuing projects that would install 100 megawatts of additional CHP capacity. Through the ADD CHP Program, FEMP can help Federal agencies connect with private-sector partners and financiers. Working with Federal facilities interested in CHP, FEMP takes basic data provided by the facility and produces a summary report that helps managers understand factors affecting their site's CHP economics and decide whether to pursue CHP. Facilities with potential can assemble more site-specific data to support a higher level of CHP analysis. The screening report gives managers expected CHP performance and economics that can help justify next steps from other partners and financial assistance to pursue CHP projects. As of June 2002, more than 80 Federal sites had requested FEMP's CHP screening, and more than one half of these merited further study of their CHP potential.

For more information about technical support for CHP projects, please see the following FEMP Web sites:

For additional information, please contact Shawn Herrera, FEMP DER Program, at 202-586-1511 or Shawn.Herrera@ee.doe.gov; Keith Kline, ADD CHP Team Lead, at 865-574-4230 or klinekl@ornl.gov; or Tatiana Strajnic, FEMP Project Financing Team Lead, at 202-586-9230 or tatiana.strajnic@ee.doe.gov.