CHP¦ Next, a facility’s existing system and fuel usage should be examined, whether it be coal, oil or natural gas, as well as whether there are multiple buildings already connected and if the existing system is steambased or hot water based. “A lot of colleges, for example, have steam-based systems,” Recchia points out. “Hot water is more efficient and modern, but we find that a lot of colleges are already committed to a steam distribution system and can’t change that. That’s okay, but if they don’t currently have a distribution system we encourage a hot water system.” If a medium- or large-sized college— which Reccia says BERC has typically found to be the best candidates for biomass CHP systems—wants to figure out if a system applies to their needs, they should also evaluate their energy demands and heat load system. “We definitely support CHP but we also really support thermal-led CHP, which is when you’re looking to maximize heating and cooling demands that you might have, and produce whatever amount of electricity proportionally, which can be supported by that type of system,” he says. “Otherwise, you may get into a situation where you’re producing electricity, but you’re wasting a lot of heat and that will reduce the economics of it.” While people become excited about CHP, Reccia says what BERC generally finds is that the thermal side of CHP helps subsidize the electrical component. “It is usually most cost effective if you do straight thermal and a little less cost effective if you do CHP, but there are a variety of reasons why people choose to go the CHP route. We’re supportive of that, as long as you’re trying to maximize the efficiency of the system overall,” he says. Biomass CHP installation activity hasn’t kept up with current interest because of the cost barriers, Reccia adds. “Colleges are becoming interested in it because they climb onto the climate change commitment, and this is a very good way to help them with that,” he says. “So we’ve seen an increased interest, but definitely not as many installations.”
Once deemed a good candidate for biomass CHP, there are other issues to consider. In particular, what kind of state or federal programs or incentives are available to help alleviate costs, as well as what might prevent a project from getting off the ground?
Incentives and Barriers In addition to supporting research, in 2001 the DOE established the first of eight regional CHP, or clean energy application, centers to provide local technical assistance and educational support for CHP develop-
ment. That same year, the EPA established the CHP Partnership Program, which encourages cost-effective CHP projects and the expansion of CHP development in underutilized markets and applications. Other federal tax incentives that may be applicable to CHP include a Recovery Act production tax credit of 1.5 cents for any closed-loop biomass project and a 75-cent credit for any open-loop biomass project for the first 10 years, and a 10 percent investment tax credit for the first 15 MW of CHP systems under 50 MW placed into service
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OCTOBER 2010 | BIOMASS POWER & THERMAL 49