November 21, 2006
Home Combined Heat And Electric Generators Maturing

Mark Clayton of the Christian Science Monitor reports that home micro combined-heat-and-power (micro-CHP) systems are becoming cheap enough that the market for home electric generators that also supply heat is starting to take off.

Since Malin changed his home heating system to micro-CHP in February, 18 other families in the Boston area also have adopted the technology, which squeezes about 90 percent of the useful energy from the fuel. That's triple the efficiency of power delivered over the grid.

Factories and other industrial facilities have used large CHP systems for years. But until the US debut of micro-systems in greater Boston, the units had not been small enough, cheap enough, and quiet enough for American homes. Add to that the public's rising concern about electric-power reliability - seen in a sales boom of backup generators in the past couple of years - and some experts see in micro-CHP a power-to-the-people energy revolution.

"Right now these residential micro-CHP systems are just a blip," says Nicholas Lenssen of Energy Insights, a technology advisory firm in Framingham, Mass. "But it's a ... technology that ... could have a big impact as it's adopted more widely over the next five to 10 years."

Get this: These things pay for themselves by lowering total cost of electricity.

Micro-CHP doesn't come cheap - just with a long-term discount. Basic systems cost from $13,000 to $20,000, installed. Even at the lower range, that's at least $6,000 more than a new high-efficiency hot-air furnace, even after a gas company rebate. Result: The payback period on the initial investment is three to seven years, depending on the cost of electricity, say officials at Climate Energy. The company expects to install about 200 systems next year, mostly in New England.

How fast they pay back probably varies by a lot more than 3 to 7 years. This is so for a few reasons. First off, residential electric costs in the United States vary from 6.23 cents per kilowatt-hour (kwh) in Idaho to 23.53 cents per kwh in Hawaii. Even that table which lists average electric costs per state understates the range of variation since some areas of states have different rates than other areas of the same states. Similarly, per capita electric energy usage by state varies by a factor of 4. Plus, the heat that comes from the gas-fired home electric generators saves much more money in colder states than in warmer states. During warmer periods the heat from the electric generator just becomes waste heat. If you use a lot of electricity, live in a cold state, have natural gas available (not all do) and it is fairly cheap then the economic argument for getting a micro-CHP device is very strong.

Micro-CHP could make home solar power more practical. Micro-CHP could kick in when the sun does not shine. Throw in some micro wind turbines on the roof and then micro-CHP would only need to kick in when the sun does not shine and the wind does not blow.

Share |      Randall Parker, 2006 November 21 11:04 PM  Energy Electric Generators

bigelow said at November 22, 2006 6:38 AM:

Last year I first heard about efficient micro combined-heat-and-power systems in use in Europe somewhere. If micro-CHPs only sip the very occasional natural gas to fill in gaps in a power system as you outlined maybe wide scale adoption will follow in North America. Otherwise geothermal might be better. Enthusiasm for natural gas powered CHP or NG vehicles should be tempered by the possibility of a natural gas “cliff event”. Matt Simmons presented this bit last month regarding North America natural gas:

– Natural gas peaked in 1973 (60 barrels per day or 10.6 barrels of oil equivalent (BOE) per day)
– Conventional gas supply is 50% of its peak
– All growth with coalbed methane, tight sands and deepwater associated gas
– Unconventional gas requires vast number of new wells
– Canadian gas also in decline
– LNG growth slow and risky

CHP is not a new idea, about a century ago Henry Ford and Thomas Edison partnered to produce home version distributed power stations and electric vehicles to recharge with them. Battery development, sabotage and World War One ended their partnership. (Edwin Black, ‘Internal Combustion’, St. Martin’s Press) In an echo of that past effort, today in some states you can refuel your natural gas Honda or GM car from home.

Simmons also states “Electricity will never be a serious transportation fuel”, he is intensely foresighted, but I hope he is wrong on that. Because a century ago Ford, then a little guy, beat the odds and produced Fords, I hope someone does it again with plug in electric vehicles.

Richard Shultz said at November 22, 2006 9:33 AM:

Cogeneration for a village of 2400 homes would be more economical than CHP for each home.

I wrote the following in response to the utilities push for approval of 18 new coal fired power plants in Texas.

Does Texas need 18 new coal fired electric generating plants ? … NO!

New housing developements in Texas should be required to have solar cogeneration utilities. This would lower C02 emmissions along with nox, so2, mercury and other emissions from coal fired plants.

A typical housing area of 2400 homes, on one square mile, would have a utility within .7 miles of each home that provided electricity, hot water, cold water, and rain water collection. The hot water would provide heating in cold months and the cold water would provide cooling for warm months. The utility could also generate ice during the day to be used to cool homes at night. Most of the energy for the utility would be collected from concentrated sunlight. This power would drive stirling engines or a steam turbine. Either engine would provide about 30% efficiency. That means that 70% of the heat energy not converted to electricity would be available to heat homes in winter.

East and central Texas land collects about 5 Kilo-Watt Hour (KWH) per square meter per day on an annual average. West Texas collects 8. Assuming most development occers in central Texas then we can use the 5 kwh figure. A typical home needs 2 kw continuous or 48 kwh in a 24 hour day. How much solar energy collection area would we need per home ? Five kwh/m2 * Area * 1/3 = 48 kwh/day. Solving for area we get 30 square meters. So the utility would need 30 square meters of sunlight collection area per home.

This area is about 15 feet by 20 feet. This could fit on a home’s roof but there are problems with home installation. Tree shade, safety concerns, maintenance, and economy of scale all make home installation a poor choice. It is better to set aside 4 city blocks of the housing area for the utility where all solar collectors would be located. These would not be solar cells. Solar cells are too expensive, at about 80 cents per KWH. Electricity from concentrated sunlight, running a steam turbine is much cheaper, about 13 cents per kwh. This 13 cent figure assumes all waste heat is lost and not available for home heating. When we include the economic value of waste heat for hot water and home heating then the cost per KWH would be reduced.

Cogeneration near the home makes sense for several reasons:
1) A nearby utility can economically pipe cold water to the home for AC. A utility a 100 miles away can not.
2) A nearby utility can economically pipe hot water for space heating, showers, laundry etc. A distant utility can not.
3) A nearby utility can collect rain water run off, from wet months, and make it available during the dry months for lawn watering.
4) With district* heating there is no need for each home to have a furnace. That reduces the cost of the home and the monthly heating bill.
5) With district cooling there is no need for each home to have an AC compressor. That reduces the cost of the home.
6) There is no need for each home to have a water heater.

On cloudy winter days , or summer nights, the utility would have to burn natural gas, switch grass or wood** to produce enough heat and electricity. But a majority of the energy produced by the utility, on an annual basis, would be from collected sunlight.
It is more economical to burn fuel at the local utility since transmitting electrical energy from a distant utility would incur transmission losses. People still want hot water for showers and laundry on a summer night, so the “waste” heat of burning fuel would not be wasted. The same fuel burned at a distant utility will be largely wasted as 70% of its energy will go up the stack, as heat, without providing any benefit.

Rain water would be collected from storm drains and piped to ponds and cisterns. There would be special pipes to carry this water back to the homes for lawn irrigation and toilet flushing. Harvesting rain water in wet seasons, to make use of in dry seasons , would greatly reduce the home water bill. Collected rainwater could be processed through ponds with reeds. The roots of reed beds can clean polluted water, ridding it of organic matter and heavy metals.

*district heating is the European term for one utility heating many nearby homes and apartments. Cogeneration with conventional fuels is used in northern Europe since heating is a big concern.

** The utility could take switch grass and convert it to methane and hydrogen through aqueous phase reforming. The stack emissions from burning methane or hydrogen would be much cleaner than with burning wood.

Randall Parker said at November 22, 2006 7:07 PM:


I think Matthew Simmons is wrong to be pessimistic about batteries. The rising demand for batteries for hybrid cars has lots of companies pursuing higher energy density batteries. They are optimistic.

Also, batteries do not need to become good enough to allow cars to go 400 miles between charges. All the shorter distance commuters could get by with 100 mile ranges.

On natural gas: But coal gas will make the exhaustion of regular natural gas irrelevant. Sure, coal gas will cost more but not so much more that gas will become uncompetitive.

Another possibility for cogeneration of heat and electricity is ethanol. When cellulosic technologies reach maturity the cost of making a gallon of ethanol might hit 50 cents.

Natural gas has been ranging lately between $4 and $8 per million BTU. How does that compare to ethanol? Well, ethanol has 75,700 BTU/gallon. To put that another way: 13.2 gallons of ethanol equals 1 million BTU of energy.

When natural gas spiked to $15 per million BTU that would have made $1 per gallon ethanol competitive. Since ethanol currently costs about $1 per gallon to produce ethanol could compete with expensive natural gas as we might see as natural gas production declines. But suppose ethanol's production cost falls to $0.50. Then ethanol would be competitive with $6.6 per million BTU natural gas.

Can ethanol ever get that cheap? Maybe not. Maybe once ethanol's price falls nearer to $1 per gallon the demand for ethanol for vehicles will get so high that ethanol won't be able to get any cheaper. But coal gas will compete. So I do not see any long term obstacle with using gas heat/electric in conjunction with micro wind turbines and photovoltaic panels.

K said at November 23, 2006 10:20 AM:

Randal: Ethanol BTUs v. natural gas is interesting on a cost basis. Is ethanol as efficient as NG when used for cogeneration and electricty?

I don't know. An expert might comment.

Intuitively it seems as if our extensive NG distribution lines should be utilized to the maximum. That points to gas generation not ethanol use. The matter is different for vehicles where NG must be compressed or otherwise reduced in volume. Also, vehicles are minted and scrapped regularly so we have more flexibility in choosing between fuels.

bigelow said at November 23, 2006 1:55 PM:


Now about 40% of North American natural gas production is already “unconventional” coalbed methane. I think you refer to gas from coal? What used to be called 'town gas' comes from a sealed pyrolized coal process. A century ago there was 500 years of coal left at current rates, a decade ago there was hundreds of years of coal left. The more we pile on to coal the shorter our reserves will be. Peak Coal? Who knows. The combination of energy sources is the key though as you emphasize. As Stephen Leeb argues, we need 50,000 or more new utility grade wind turbines.

Just read a rumor that General Motors may show a new hybrid electric vehicle at the Auto Show.

Engineer-Poet said at November 24, 2006 6:54 AM:

Only 50,000?  Maybe if they're 10 megawatt units; we could use at least 300,000 at the current 1.5 MW size.

I'm putting the finishing touches on a long piece right now (watch The Oil Drum) which shows that we can replace all fuel used for electricity - AND all motor fuel - with renewables derived from biomass.  It would be foolish to rely exclusively on biomass, of course; the fewer the sources, the greater the insecurity of supply.  But it shows that oil independence is within reach.

(Hey, what's this BS about having to wait to post again?  This is my first comment today, and it's grossly unfair to force someone to guess what a "short time" is, versus a malfunction of the #$*(&! code.)

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