Pennsylvania State, Mid-Atlantic CHP Application Center

Summary of Activity
A significant percentage of the electrical generation in Pennsylvania takes advantage of its waste heat, at 7.2% of total generating capacity this is below the 8% national average in 2003. 3.8% of this capacity is in the industrial sector, 1.6% is in the commercial. Electrical prices are below the national average and have gradually fallen over the last 10 years. Natural gas has experienced price fluctuations along with the all other states in the region and seen prices climb 24% over the last 12 years. There has been small amount of CHP and distributed energy activity in the state to this point. There remains 36,627MW of CHP potential within the state, the bulk of it within the industrial sector.

Installed CHP Capacity
Currently, Pennsylvania 's CHP market generates 7.2% of its total energy market, amounting to a capacity of 36,627MW. This energy is primarily generated through 95 major CHP facilities. Commercial attributions account for 587.5MW of the total market through the use of 37 different facilities. The remainder is attributed to industrial and other uncategorized sectors, having 47 facilities producing 1389.1MW and 11 facilities producing 661.6MW, respectively.

Representative Local Installations

Descriptions of successfully-implemented CHP projects can be used to get ideas for the planning, financing, approval and installation processes involved. The lessons learned in these projects are a valuable resource for those considering CHP, whether in commercial, institutional, or industrial applications. Selected Mid-Atlantic CHP projects are available here, having been obtained from a variety of sources, including other RACs or through DOE.

Gray's Ferry CHP Plant - 170 MW of CHP in Philadelphia, PA, operational 1998

Masonic Homes CHP system - 300 kW of CHP in Elizabethtown, PA, operational 2003

Potential Market for CHP
According to the US Department of Energy, installations of CHP systems in Pennsylvania's commercial and industrial sector have the potential to generate 2410 to 7480 MW, representing 5-16% of DOE's 47GW long-term goal.

State Restructuring Activities
Pennsylvania 's legislation was among one of the first in the country to deregulate it's electrical market making customer choice available to consumers as early as 1996. Since then over 278,243 customers have chosen to use an alternate supplier. Pennsylvania has one of the country's most powerful electric markets having over 70 companies competing in it.

Links:

Summary of Restructuring by Mid-Atlantic Energy Coalition

Status of State Electric Industry Restructuring from DOE EIA (pdf)

Pennsylvania has passed a law that requires electric distribution companies and electric generation suppliers to increase use of selected alternative generation sources. One of the options noted in this bill is “distributed generation system, which shall mean the small-scale power generation of electricity and useful thermal energy.” In addition, it addresses several opportunity fuels that could be used in CHP systems such as digester gas, biomass fuels, waste products (including recovered exhaust heat). A summary of the law’s provisions is provided in the December 10, 2004 notice listed in the “News & Events” page of this website.

Electricity Pricing
Since 1990, Pennsylvania 's commercial electrical costs have followed a gradual decline. Commercial consumers payments have slightly reduced from $0.0819 per kWh in 1990 to $0.078 per kWh in 2000 ($/MBtu = .3413kWh). This figure is below the 2000 national average of $0.0736 per kWh.

Natural Gas Pricing
When evaluating CHP, a considerable amount of attention needs to be placed on the price of natural gas. Natural gas prices in the state of Pennsylvania have steadily increased over the past few years. Compared to the national average of $6.57/kft 3 in 2002, Pennsylvania 's prices are slightly higher than average having a price of $7.44/kft 3 that year.

The combination of falling electric prices and climbing prices for natural gas make the "spark spread" between the cost of electrical and fuel energy smaller which tightens the profitability of CHP technology but there are still going to be successful applications for the appropriate use of CHP. Issues with the reliability of power in light of both the tropical storm and grid power disruptions to the north will motivate users to explore DG options. In the case where DG is already being installed, waste heat recovery is likely to decrease the operating cost of the installation. DG remains distinct from emergency backup generators, which are typically not permitted to operate continuously due to the emissions permit that they are issued with.