Page 122 - Sustainable On-Site CHP Systems Design, Construction, and Operations

100 CHP B a s i c s

than the federal government. While federal incentives such as tax credits can have a
considerable impact on economic barriers, there are many other barriers that have
traditionally stood in the way of CHP implementation. These barriers are varied but do
include such issues as interconnection with the local power grid, local emissions regula-
tions, permit approval time, citing restrictions, etc. as well as capital cost. Many of these
issues including to some extent cost, are actually controlled at a local, utility or state
level. Also in most cases the local and utility influenced issues are actually overseen or
regulated by the state.
Interconnection with the electric grid is a good example of the development of state
influence over CHP development. Originally interconnection with the utility power
distribution grid was regulated directly by the local utility. In the post-PURPA era a
natural gas–fired CHP plant generally will not export electricity to the wholesale mar-
ket as it is not economically feasible to do so nor will it be sized to meet the peak power
needs of the host facility for the same reason. It must, therefore, work in conjunction
with and be interconnected to the local power grid to be economically feasible. Obtaining
an interconnection agreement with the local utility became a significant barrier to the
implementation of CHP until some states took control of the situation and developed a
statewide standard interconnection specification, which they were able to force the
utilities to accept including defining maximum response times on applications by
the utility. This type of action has served to significantly reduce this barrier for many
projects within states that have standard interconnect agreements such as California
and New York. In all cases, the interconnection agreement must still be accepted by the
local utility but standards imposed by the state provide some formality and recourse to
the applicant.
Emission requirements can also be a significant barrier that is generally controlled
at the state level. While the federal EPA has the authority to designate areas of attain-
ment or nonattainment for various criteria pollutants, the state air quality management
agencies administer the programs relating to air quality. For all but the largest CHP
plants the state agency responsible for air quality sets the emissions standards so that
they can meet federal air quality standards at a minimum. Emissions standards for
CHP do vary considerably from state to state as well as within each state depending on
its federal air quality standard attainment status. In general for natural gas–fired CHP
plants, which (as shown in Chap. 2) represent the majority of plants, the main criteria
pollutant of concern is nitrous oxides (NO ) which is a precursor to ground level ozone
x
and so ozone level attainment status is a significant indication of how tough emission
requirements will be. Areas that are in noncompliance with federal EPA standards for
ozone will require that CHP plants emit less NO than plants that are located in attain-
x
ment areas.
A significant policy change that supports deployment of CHP in many states has
been the recognition of the effect of the increased CHP fuel efficiency versus central
power generation on emissions. Using less fuel by offsetting boiler operation with
waste heat from a CHP plant directly reduces the emissions that would have resulted
from the operation of the boiler. Some states, such as California, give an emissions credit
for the energy recovered from power generation for useful purposes that can be added
to the power output of the system when calculating emissions rates per unit of output.
In this scenario the total system emissions are calculated by adding the useful thermal
output to the power output, the total of which is then divided by the emissions to cal-
culate the pounds per unit output (typically kW or MW) of a particular pollutant. This