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1. Difference between costs of grid electricity and natural gas price—see FEMP and Resource Dynamics Corporation charts below for spark spread generalizations by state—is one indicator of CHP economic feasibility
Federal Energy Management Program Spark Spread Analysis Map
Resource Dynamic Corporation Spark Spread Analysis Map
2. A second indicator of economic feasibility is industry strength—see Subsector Profiles for more information on industry strength or viability.
3. A third way to increase economic feasibility is by sizing any CHP system to optimize the thermal energy utilization, or “size for thermal.” That way, the CHP system is most efficient and cost-effective.
Calculating Economic Feasibility
Payback can be calculated via inputs into spreadsheet or software programs; below is payback calculator that takes capital costs, regional incentives, and many other factors into account.
There are many CHP feasibility software tools available—some for free (see below). This “first cut” may let an end-user know if he/she should go to the next step of working with a project developer. A short list of software tools include:
• RECIPRO
• Cogeneration Ready Reckoner (see below)
• BCHP
• Building Energy Analyzer
• D-Gen Pro
• Heatmap CHP
These tools may all be accessed at the Cooling, Heating, and Power for Buildings website.
The Cogeneration Ready Reckoner is downloadable for free at the Cooling, Heating, and Power for Buildings website. It screens industrial CHP, provides baseline comparisons between grid power and onsite CHP systems, uses gas turbine and reciprocating engine generation sets data libraries, and analyzes the feasibility of process steam, hot water, and/or chilled water. Some parameters include:
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