Industrial Energy Tool

CHP Cogeneration Feasibility Calculator

Evaluate Combined Heat and Power (CHP) for your facility. This screening tool compares separate electricity purchase + boiler vs. on-site gas engine/turbine cogeneration. Calculate fuel savings, payback, and CO₂ reductions.

Facility Parameters

Electrical Demand

Average electrical load (kW)500
24/7 average. CHP works best with constant baseload.
Operating hours/year8,000
CHP needs >5,000 hrs/yr for good economics.

Thermal Demand

Average thermal load (kWth)600
Hot water, steam, or process heat required.
Current boiler efficiency (%)85
Typical: 80-90% for condensing boilers.

Energy Prices

Electricity price ($/kWh)0.12
Natural gas price ($/therm)0.80
1 therm = 29.3 kWh = 100,000 BTU.

CHP System Specifications

CHP electrical efficiency (%)35
Gas engine: 30-42%. Gas turbine: 25-40%.
Heat recovery efficiency (%)45
Recoverable heat as % of fuel input.
CHP unit size (kWe)500
Match to your baseload for best results.
Installed cost ($/kW)1,800
Typical: $1,200-$2,500/kW installed.
O&M cost ($/kWh)0.015
Includes maintenance, overhauls, lubricants.
Grid CO₂ factor (kg/kWh)0.45

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Frequently Asked Questions

What facilities are best suited for CHP?
CHP works best with: (1) Consistent year-round thermal and electrical loads, (2) >5,000 operating hours/year, (3) "Spark spread" (electricity minus gas price) favorable margins, and (4) Heat-to-power ratio matching available CHP systems. Ideal candidates: hospitals, hotels, data centers, food processing, universities.
What is the spark spread?
Spark spread = (Electricity price × efficiency) - Gas price. A positive and healthy spark spread (>$30/MWh equivalent) indicates CHP can generate power cheaper than grid purchase. This tool calculates the effective comparison.
How much CO₂ does CHP actually save?
CHP typically achieves 75-85% total fuel utilization vs. ~45% for separate grid power + boiler. CO₂ savings come from this higher efficiency. Savings depend on grid carbon intensity — CHP in coal-heavy grids saves more than in hydro/nuclear regions.

Why Choose Combined Heat and Power (CHP)?

Combined Heat and Power (CHP), also known as cogeneration, is an energy-efficient technology that generates electricity and captures the heat that would otherwise be wasted to provide useful thermal energy—such as steam or hot water—that can be used for space heating, cooling, domestic hot water, and industrial processes. By producing two forms of energy from a single fuel source, CHP provides significant advantages.

The Economics of the "Spark Spread"

The gross margin of a CHP plant is mainly determined by the Spark Spread. This is the theoretical gross margin of a gas-fired power plant from selling a unit of electricity, having bought the fuel required to produce this unit of electricity. A wide spark spread means it is much cheaper to generate your own power on-site using natural gas than to buy it from the grid. Our calculator helps you evaluate this complex relationship in seconds.

Environmental and Reliability Benefits

This CHP Feasibility Calculator is a vital first-step screening tool for facility managers and energy consultants to determine if a detailed investment grade audit is warranted.