Global Foundries is a semiconductor manufacturer that wanted more control over its energy use. This process eventually led it to construct a combined heat and power unit at its Dresden, Germany, plant. It uses nine natural gas engines that provide 35 megawatts of electricity, 38 MW of heat, and 53 MW of cooling.
The combined heat and power system has a 90% efficiency rate — the total energy generated from each unit of fuel that is input. The waste heat from the natural gas engines is captured and re-used. While Global Foundries has a ways to go before it would be carbon-neutral, it is making progress. It has reduced those releases by 24% since around 2005.
The surge in natural gas production has changed the face of electricity production. And commercial and industrial users are the primary beneficiaries — a business sect that can now choose whether to buy its electricity from the local utility or generate it themselves. However, a CHP system can run on a host of fuels — everything from natural to biomass to biofuels.
“In many industrial installations such as production facilities, refineries and regional district heating plants, the operating costs are reduced by implementing a combined heat and power system (CHP) with clean pipeline natural gas as a fuel,” says MWM, which designed the CHP system for Global Foundries. “The total energy cost savings of such systems can more than offset the total owning and operating costs, delivering a payback in as little as two to three years, depending on local energy pricing and policies.”
The market, globally, for CHP, is set to expand by 2031 at one-and-a-half times the size it is today. Sales are expected to be $26 billion during that time, says Fact.MR — with the industrial sector generating much of the demand. What’s driving demand? The need for more reliability along with lower cost. And yes, lower emissions are a part of the decision-making. Compared to a traditional power plant that runs at around 45% efficiency, the market research company says that a CHP facility typically performs at 80% efficiency, resulting in lower operating costs.
About 82,000 megawatts of installed onsite CHP exist across the country at almost 4,000 industrial and commercial facilities, adds ICF. That’s about 8% of the US electric generation base. Besides MWM, General Electric, Siemens AG, and Wartsila are among other companies in the CHP space.
Enhanced Reliability
To be sure, the initial cost may be a deterrent. Central generation is notably less expensive per kilowatt than onsite generation delivered by a local microgrid. However, with a big plant, there’s a need for transmission and distribution — all of which adds to the expense of building a central power facility and which makes localized power production more attractive.
CHP is an appealing choice for commercial and industrial users. That’s because the lost heat must be immediately captured and re-used — or it will degrade and become useless. If the lost heat travels long distances, it loses its efficiency, and thus the technology must be used for onsite generation.
Consider Procter & Gamble's factory in Wyoming County, Pa.: the plant, which produces Pampers diapers and Charmin toilet paper, draws on natural gas from the Marcellus Shale formation, improving the company’s finances and its environmental record.
Procter & Gamble’s onsite operations now are more efficient than if it had bought power from central-station utility generators, which lose energy as it travels through the transmission network. In fact, conventional generation has an efficiency rate of about 51%, whereas the CHP units like the ones used by the consumer product maker can achieve at least 75%, says ICF International.
“Designed to operate every day, CHP systems may be more reliable than traditional emergency back-up generators during grid outages,” says NYSERDA, the New York State Energy Research and Development Authority, which advances clean energy innovation in New York. “This resiliency might make them a good option for multifamily buildings. The ability to produce electricity and heat during grid outages is also advantageous for critical care facilities including nursing homes and hospitals. A site-specific, detailed analysis should be conducted before committing to purchase a CHP system.”
Who benefits? According to NYSERDA, it’s large-scale facilities or multi-building complexes that experience significant loads and have mission-critical ventures — like a chipmaker. It’s good if the business needs to reduce its carbon footprint and generate reliable backup power. CHP can allow companies to keep operating in the event of a large-scale power outage or weather event.
Businesses like Globalfoundries are discovering those benefits firsthand. Indeed, combined heat and power and onsite generation are proving their efficiency. The waste heat is being re-used, but there are also no distribution line losses. That means less fuel is needed. And thus, the savings and environmental benefits start to add up.
