The CHP experience in California: Inputs from the field

Many incentive programs have been developed in California over the past several years to promote renewable energy and energy efficiency, and have undergone modifications to better suit and promote new types of self-generating energy technologies. The Self Generation Incentive Program (SGIP) is one of the largest state-level energy incentive programs, established by the state of California in 2001. The SGIP emerged as a result of the California energy crisis in the year 2000 - to address the rising electricity demand. One of the major target areas of this program is the Combined Heat and Power (CHP) market. At least one major status review of the CHP incentive and implementation has been conducted by the Itron group. This study revealed that many of the CHP facilities were not meeting the required efficiencies related to Section 218.5 of the Public Utilities Commission (PUC). A number of improvements in design and operational aspects of CHP were recommended by the Itron group as a result. More recently, The California Energy Commission (CEC) supported this project to conduct a field survey and review operational status of CHP systems. The field data suggest that there are a number of areas related to system design, operation, control, as well as maintenance that need to be improved in order to make CHP a viable technology. This paper presents these challenges as they relate to the future of the CHP industry in California, with ideas included for how a smart grid might serve to meet some of these challenges and create new opportunities.