What is Cogeneration?

Understanding cogeneration, also known as combined heat and power (CHP). The fundamentals behind the technology, its applications, and benefits. 

Cogeneration, also known as combined heat and power (CHP), is transforming how businesses and industries generate and use energy. It offers high efficiency, cost savings, and sustainability benefits. We interviewed Jason Kaplan, Vice President and General Manager of the Energy Resilience Group at CoolSys Energy Solutions, and Standa Soucek, Director of Technical Services at CoolSys Energy Solutions, who oversees the engineering and maintenance of cogeneration units.

In this interview, we break down the fundamentals of cogeneration, explore its applications, and highlight its advantages.

Note: The interview responses have been edited for clarity and length

CHP is commonly used in Europe, and while it is increasingly adopted in the U.S., many may still be unfamiliar with it. Could you explain this technology in simple terms?

Cogeneration is basically energy production from one fuel source in the place where both the electricity and the heat are used. It means that the cogeneration units are really efficient. They don’t have transient losses. CHP unit means combined heat and power in the facility where these energies are utilized.

Jason Kaplan

Cogeneration is the simultaneous production of electricity and heat or thermal production—whether it’s heat or cooling—out of one fuel source. That fuel source can be natural gas, biogas, renewable gas, syngas or hydrogen gas. Pretty much any type of gas is the ideal fuel source for cogeneration.

Standa Soucek

The European grid is more decentralized, and the CHP units are used for grid balancing and interconnection. One big difference is that the electricity cost per kilowatt hour in Europe is higher than in the U.S. The possibility of balancing the grid and covering the peak creates many opportunities for CHP units. The U.S. market is growing, and there are a lot of opportunities.

Jason Kaplan

Energy prices in Europe have traditionally been higher than in the U.S., and the dynamics there are starting to change due to macroeconomic forces. So, whereas very inexpensive energy in the U.S. has been a staple for a long time, as the cost of energy increases, the commercial and industrial segments of the market will look for a way to reduce their energy costs. Cogeneration, a tried-and-true tested technology in other parts of the world, is a natural solution for this problem mainly because natural gas is abundant in the U.S. Natural gas is the ideal fuel source for cogeneration. Out of it, the high efficiency and lower cost and actual reduction in greenhouse gases can be realized from the cogeneration technology.

Standa Soucek                                                                                                               

The first cogeneration unit was created in the U.S.  in New York at the Pearl Street station by Thomas Edison [CC1] 148 years ago. CHP technology is not new for the U.S, but the market has been growing slowly.  A  big driver is costs per kilowatt hour. Generally, the cost of energy and electricity in Europe is more expensive than here in the United States and the European companies were really forced to find the most efficient solution.

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