Over the past several years, customer-sited cogeneration systems have been viewed as a way to mitigate electrical supply shortages. On the utility side, achieving this goal requires cogeneration systems to operate at a relatively high capacity factor, especially during peak periods. On the customer side, the cogeneration system must be capable of reducing operating costs, which can be accomplished by running the system at high operational efficiency and recovering available waste heat. Our firm has been evaluating customer-sited cogeneration systems installed under the Self Generation Incentive Program (SGIP). This paper will present the results of an in-depth performance evaluation conducted for the SGIP Working Group to evaluate the effectiveness of useful thermal energy recovery of on-site cogeneration systems that received incentives from the program. An earlier study investigated levels of energy efficiency and useful waste heat recovery achieved by cogeneration systems in the SGIP. This study raised some interesting questions regarding the actual operational efficiencies of cogeneration systems and low thermal heat recovery. By incorporating fuel consumption, thermal energy recovery and prime mover performance data obtained through the Program’s measurement and evaluation monitoring efforts, actual measured performance was compared to engineering estimates of performance for each project. Thermal heat recovery plays an important role in the overall performance of a cogeneration system. This paper will explore some of the key drivers behind the unexpectedly low thermal energy recovery and overall plant performance. Possible ways to improve the useful waste heat recovery will also be discussed. Regular maintenance and thorough monitoring of the cogeneration system has big impact on the performance. Because the performance data includes the actual timing (hour and month) of cogeneration system operation, the effects of this distributed generation resource is evaluated by taking into account the large differences between peak and offpeak energy costs and benefits. This program-level distributed generation analysis can help program designers and policy makers to understand the limitations of smaller cogeneration applications relative to those systems envisioned under Public Utility Regulatory Policy Act (PURPA) and thus may have important policy implications for the future of cogeneration and distributed generation programs throughout the U.S.

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