CHP Market

CHP is an important electric generating resource in the United States. Currently, over 82.7GW of CHP capacity exists at over 4,400 industrial and commercial facilities across the country. This represents 8% of U.S. electricity generation capacity, however it represents over 12% of annual U.S. power generation, reflecting the longer operating hours of CHP systems as compared to conventional forms of generation.

CHP systems are installed in every state, however there are significant regional differences in the distribution of CHP sites and capacity. Some states have adopted policies that encourage CHP growth, most notably California, New York and Connecticut, which offer financial and other incentives to CHP projects. Other regional variations come from electricity price variations, energy market structures, and industrial development. For example, chemicals and refining facilities are common in the Gulf Coast states and paper production in the Southeast. States with higher overall energy demand, more energy-intensive industry, and dense population centers with concentrated electricity and thermal energy demand naturally have the highest amounts of CHP capacity.

Figure 3-1 Existing CHP Capacity by State

CHP can be utilized in a variety of industrial facilities and commercial buildings with coincident power and thermal loads. Figure 3-2 presents a breakdown of CHP capacity by major market sector. The majority of existing CHP capacity in the United States is in the industrial sector and is concentrated in five major facility types: chemicals, refining, paper, food and metals manufacturing.

Figure 3-2: Existing CHP Capacity in the United States by Facility Type

Figure 3-3 shows existing commercial CHP by business type.

The technical potential is an estimation of market size constrained only by technological limits — the ability of CHP technologies to fit customer energy needs without regard to economic or market factors. Across all CHP categories, there is estimated to be more than 240GW of technical potential at over 291,000 sites within the U.S. table 3-1 represents the total CHP technical potential identified in the United States by application or business type, including on-site CHP at industrial and commercial facilities, export, waste heat to power applications or district energy systems that could integrate CHP.

Table 3-1: CHP Fuel Use by Sector

Business Type	500-500 kW		0.5 - 1 MW		1 - 5 MW
	#Sites	Capacity (MW)	#Sites	Capacity (MW)	#Sites	Capacity (MW)
On-site Industrial CHP	34,502	6,281	6,069	4,341	7,424	15,567
On-site Commercial CHP	185,625	20,068	37,939	18,100	15,535	20,284
On-site WHP CHP	332	73	132	95	341	868
Export Industrial CHP	na	0	na	7	na	3,929
Export District Energy CHP	0	0	0	0	5	18
Total	220,459	26,422	44,140	22,543	23,305	40,66

Business Type	5 - 20 MW		>20 MW		Total Sites	Total Capacity (MW)
	#Sites	Capacity (MW)	#Sites	Capacity (MW)
On-site Industrial CHP	1,901	17,036	479	22.157	50,375	65,381
On-site Commercial CHP	1,084	9,452	174	8,026	240,358	75,930
On-site WHP CHP	204	2,003	96	4,585	1,105	7,624
Export Industrial CHP	na	11,535	na	65,578	na	81,048
Export District Energy CHP	8	75	51	10,567	64	10,660
Total	3,197	40,101	800	110,913	291,902	240,644

In contrast to the existing facilities with installed CHP, which are heavily concentrated at large industrial manufacturing facilities, a significant portion of the remaining technical potential for on-site CHP in the U.S. is located in commercial facilities. Figure 3-4 shows both existing CHP and estimated technical potential capacity for on-site CHP in the most predominant sectors.

Figure 3-4: Existing CHP Compared to On-Site Technical Potential by Sector.