Mid-Atlantic CHP Application Center

This page is designed to provide background information on CHP activity in Maryland.

Summary of Activity
Installed CHP Capacity
Potential Market for CHP
Electricity Pricing
Natural Gas Pricing
State Restructuring Activities
State Agency Contacts
Electric Utilities Websites
CHP Requirements & State Support Programs Links

Summary of Activity
A significant percentage of the electrical generation in Maryland takes advantage of its waste heat, at 6.5% of total generating capacity this is below the 8% national average in 2003. Ten percent of this capacity is in the industrial sector, 1% 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 28% over the last 12 years. There has been a fair amount of CHP and distributed energy activity in the state to this point. There remain 11789MW of CHP potential within the state, the bulk of it within the industrial sector.

Installed CHP Capacity
Currently, Maryland 's CHP market generates 6.5% of its total energy market, amounting to a capacity of 11,789MW. This energy is primarily generated through 14 major CHP facilities. Commercial attributions account for 78.1MW of the total market through the use of 6 different facilities. The remainder is attributed to industrial market having 8 facilities producing 687.4MW.

Potential Market for CHP
According to the US Department of Energy, installations of CHP systems in Maryland's commercial and industrial sector have the potential to generate 1320 to 2410 MW, representing 3-5% of DOE's 47GW long-term goal.

Electricity Pricing

From 1990 through 2000, Maryland 's commercial electrical costs have followed a gradual decline. Commercial consumers payments have slightly reduced from $0.0680 per kWh in 1990 to $0.0661 per kWh in 2000 ($/MBtu = .3413kWh). This figure is below the 2000 national average of 0.0736 per kWh.

However, several factors have let to price increases in recent years. These include natural gas price spikes, the bankruptcy of Mirant (and subsequent cancellation of their long term contracts with Pepco), and the recent (or upcoming) end of price freezes that were implemented when the market was deregulated. The outlook for electricity prices is uncertain and it is anticipated that prices will remain highly volatile for the foreseeable future.

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 Maryland have steadily increased over the past few years. Compared to the national average of $6.57/kft 3 in 2002, Maryland 's prices are slightly higher than average having a price of $6.83/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.

Links to more detailed energy price data:
EIA's Natural Gas Navigator
EIA's State Energy Prices

State Restructuring Activities
As of the year 2000, customers in the state of Maryland have had the opportunity to choose their electric supplier. After experiencing a slow start, more than 70,000 customers have switched electricity suppliers. This figure represents approximately 2,000MW of electricity, about 16.6% of the peak load.