Combined Heat and Power (CHP) offers the “best of both worlds”: a proven efficiency technology that accelerates the integration of renewable energy, according to a report from the International Energy Agency (IEA).

The report, Co-generation and Renewables: solutions for a low-carbon energy future, observes that ‘co-generation’ (CHP) is attractive to both policy-makers and private users and investors because it delivers a range of energy, environmental and economic benefits, including:

In addition to the local benefits of reduced energy bills and carbon emissions, the report highlights to potential for CHP to support the deployment of intermittent renewable energy resources such as wind.

Combining CHP plants with thermal storage (large, insulated hot-water vessels), also allows them to perform a balancing function for intermittent forms renewable energy. CHP plant can be operated on a flexible basis to generate electricity as required, while thermal storage allows for the heat demand from homes and businesses to be disconnected from their supply. The use of thermal storage in this way can significantly reduces the cost of and stress on the transmission network by countering the ‘peaky’ nature of renewable generation. As the report cites, “storing heat is simple but storing electricity is still difficult and expensive”.

However, the report notes that under current financial frameworks, operators are unlikely to invest the up-front capital required for developing CHP in this manner. Greater certainty that the financial and carbon savings created will be recognised by the market is required before organisations will be willing to participate in the unpredictable business of balancing renewable energy generation. The UK’s Electricity Market Reform process provides the ideal opportunity to supply this to CHP operators.

Commenting on the release, CHPA Director Graham Meeks said:

“This important report demonstrates that those countries that have adopted CHP as part of an integrated energy system are often at the head of the pack in decarbonising their energy supplies. The UK would do well to heed the advice of the IEA as we embark on a new phase of investment in our own energy infrastructure.”

“The IEA report underlines the growing value of CHP in tackling the challenge of delivering secure, low-carbon energy at the least cost to the consumer. The flexibility and efficiency provided by CHP will be increasingly in demand as energy systems incorporate more and more intermittent renewables whilst making more effective use of scarce bioenergy and carbon-emitting fossil fuels.”

Source: CHPA