CHP – Everything you need to know about Combined Heat and Power Systems

The inside of a CHP Combined Heat and Power Plant
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In a world where the cost of power is ever increasing and the effects of climate change are seemingly all around us, businesses have two issues on their mind when it comes to energy – how can they save money at the same time as reducing carbon emissions? Many find the answer with CHP.

CHP stands for Combined Heat and Power. Traditionally, plants and factories would have two separate power systems; one for producing the electricity that powered the site and one which was used for heating the buildings.

One of the by-products of generating electricity is heat, which in a standard power system escapes. Rather than allow this heat to go to waste, a CHP System instead captures it to warm the facility. As a result, two power systems are combined into one which reduces running costs and lowers a business’ carbon footprint.

Perhaps the easiest way to understand CHP is to think of it as being like a car engine. When you turn the engine on, the primary function is to get you from A to B. The heat that the engine generates while doing that is captured by the car and used to warm the interior while you drive along.

That is essentially what Combined Heat and Power does, just on a much larger scale.

How does CHP work?

All Combined Heat and Power Systems consist of a prime mover which generates the power and a heat recovery system which captures the excess heat. There are five principle types of CHP prime movers, each of which work in different ways:

  • Internal combustion engines
    Internal combustion engines within a CHP System or similar to those found in cars or electrical generators, except that they operate on either natural gas or diesel.

    The heat produced usually comes in the form of hot water, with heat exchangers in the CHP Plant recovering it. Internal combustion engines are best suited to non-industrial sites.

  • Steam turbines
    A Combined Heat and Power System with a steam turbine as the electrical generator captures the steam once it has been used to drive the turbine. For efficiency reasons, it is usually condensed before being pumped back to the boiler as hot water through a system of pipes.

    In this type of CHP system, the heat is a requirement to drive the turbine rather than an unintended by-product. For that reason, a steam turbine CHP Plant is best used in large-scale facilities where the demand for heat outstrips the need for power.

  • Gas turbines
    In a CHP System with a gas turbine as the prime mover, natural gas is burned to drive the turbine.

    The heat from the turbine’s exhaust gasses can is then recovered and used to heat up the facility with the CHP Plant.

  • Combined cycle gas turbine
    The combined cycle gas turbine combines steam and gas together into one system – a Combined Combined Heat and Power System. The high-temperature exhaust from the gas turbine is converted into a component that can generate steam which is then used to drive a steam turbine.

    Because this type of CHP Plant consists of two systems, it offers the most efficiency of any of the main CHP options. It also requires more space, which means it is typically used for large-scale power generation in significantly sized sites.

  • Biomass
    Biomass CHP Systems replace natural gas or coal as the source of fuel with biomass instead. As a result, they deliver even lower carbon emissions.

    There are even Combined Heat and Power Systems which capture the wasted gasses produced as a by-product of the breakdown of animal or food waste through anaerobic digestion. These gasses are then used to operate an internal combustion engine in a CHP Plant.

    The most commonly used gas in this process is methane, found during the breakdown of liquid biomass in sewage treatment works. It can then be used to power and heat sewage plants.

    Biomass CHP Plants are becoming a popular option in the United Kingdom. They are championed by Ecoliving and are also entitled to significant financial incentives under the government’s Renewable Heat Incentive.

  • New and emerging technologies
    CHP developers are always looking for new ways in which they can adapt Combined Heat and Power Systems for compatibility with other technologies. Among the success stories so far are:

    Stirling engines – powered by a gaseous fluid such as air or helium, a sterling engine works like a steam engine in the way that it produces and then recovers heat.

    Fuel cells – a cell which electrochemically oxidises fuel to generate electricity. The process of oxidisation creates waste heat which is then captured.


What are the benefits of Combined Heat and Power to the environment?

CHP Systems can help to reduce a site’s carbon footprint by an average of 30%. According to studies by the Carbon Trust, CHP is responsible for saving 14.76 million tonnes of carbon dioxide annually. This equates to 2.71 million tonnes for every 1,000 megawatts of electricity produced.

The primary way in which CHP saves energy is through its combination of electrical generation and heat generation. For every 100 units of fuel used, a typical CHP Plant will produce 30 units of electricity and 45 units of heat.

A conventional system in which power is produced in a power station and heat from a separate boiler would require 139 units of energy to match the output of CHP.

An onsite CHP Plant also reduces the carbon footprint of a business by ensuring that they no longer have to import electricity and heat onto site from an external source. Far less power is needed when power itself is produced onsite as opposed to being transmitted across long distances.

How much money can Combined Heat and Power save?

CHP has been shown to reduce energy bills by between 20% and 30%. There are many other financial benefits to installing a CHP Plant, with various tax breaks and exemptions available to businesses who use Combined Heat and Power.

In order to qualify for these benefits, a CHP Plant must be graded as ‘good quality’ under the CHP Quality Assurance Programme which looks at the efficiency of a plant.

Those with good quality CHP can receive a reduction or full exemption from the Climate Change Levy, an enhanced capital allowance to reduce corporation tax and possible exemptions from business rates.

Where can a CHP System be installed?

Combined Heat and Power is suitable for any site where both electricity and heat are needed for extended period of times. In the United Kingdom, Combined Heat and Power is most commonly found in three industries – chemicals, oil refineries and publishing.

All three require large quantities of power for their output and so harnessing that power to also heat their facilities for employees and visitors at is an obvious approach to take.

Large community and housing schemes can also benefit from CHP Systems. In the higher education sector, university buildings and student accommodation have high power and heating demands, as do hospitals, hotels and leisure centres.

Guy’s and St Thomas’ NHS Foundation Trust saved £1.7 million in energy costs and reduced their carbon emissions by 20% when they switched to Combined Heat and Power in 2004.

How much does CHP cost?

A Combined Heat and Power Plant isn’t cheap to install, which is why the UK Government offers such generous incentives to companies who do decide to switch to CHP.

As with any major infrastructure and supply decisions, businesses who are considering installing CHP should carry out detailed analysis into the cost benefits, the environmental benefits and ultimately the feasibility of having their power and heat supplied by CHP.

Once installed, CHP Systems to have be managed effectively for a site to reap the full benefits. Maintenance is crucial, which is why there are a number of contractors who can offer CHP repair services to ensure that your Plant is always in good working order.

When used correctly, a Combined Heat and Power System will deliver a significant return on investment within three to five years.

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