What is Combined Heat and Power?
Combined Heat and Power (CHP) - also known as ‘Co-generation’ - is an energy conversion process producing electricity and heat simultaneously.
Due to the characteristics of steam turbo-generators, electricity generating plants have thermal efficiencies below 35%.
In the case of waste-burning Energy Recovery Facilities (ERFs), this efficiency is typically limited to 23-32%.
By adopting CHP, the ERF thermal efficiency can be raised to around 70%. This is a vast improvement on coal-burning power stations that achieve around 27% and even compares favourably to modern gas-fired combined cycle power plants that manage around 60%.
The Issues
CHP is a well-established concept with a long history but is more common in Europe than the UK. Our production and use of energy is therefore less efficient compared to many other countries.
The need to address this has never been more urgent. Due to new laws and an obligation to use energy more efficiently, CO2 emissions must be reduced. An effective way of achieving this is to raise the efficiency of energy production.
As a result, CHP or ‘distributed energy’ has become a key part in the strategy of most re-development schemes. As an incentive for energy recovery from waste, the Government will award Renewable Obligation Certificates (ROCs) to ERFs that can produce ‘Good Quality CHP’. This is CHP that meets the requirements of the CHPQA scheme and plants only generating electricity cannot receive this award or the subsidy that goes with it.
Development of any waste-related infrastructure receives a level of opposition and there is a particular pressure at local planning level to locate ERFs away from the communities that produce the waste and need the heat. To work effectively, CHP requires steady and constant consumption, so isolated and rural areas are not always viable locations.
Our Position
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Veolia Environmental Services is the largest energy from waste provider in the UK and proudly operates the country’s most extensive waste powered CHP plant in Sheffield. This provides around 100,000MWh of heat per year in the form of hot water to major city-centre buildings and several housing schemes, as well as having the capacity to treat circa 225,000 tonnes of waste.
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The Veolia Environnement Group is one of the foremost operators of CHP schemes in the world and Veolia Environmental Services is the operator of the largest waste-fired CHP scheme in the UK. The company strongly supports CHP and wishes to see it installed wherever viable.
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Installing heat distribution pipework and fitting the heat exchangers in each building can be disruptive. However, with careful project planning and management, routes for the piping can usually be found and the heat exchange equipment installed.
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The only ERF operated by Veolia Environmental Services in the UK with CHP is Sheffield. At SELCHP (South East London CHP), it has not yet been possible to develop CHP even though the plant is correctly configured. This failure is not a result of unwillingness to develop CHP, or the difficulties of building the infrastructure, but the difficulty in attracting public bodies and private organisations to take the heat at a commercial price.
We believe this market failure will only be corrected with direct intervention and support from the public sector. Actions like subsidies and the underwriting of housing associations would take away any risk involved and help CHP technology benefit the masses.
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Energy-from-Waste (EfW) will help de-carbonise energy generation within the UK. The Institution of Civil Engineers estimated that EfW could account for 17% of UK electricity consumption in 2020. ERFs are not as dependant on weather as wind turbines, so have greater availability. Appropriate subsidies will advance the generation of energy from waste, cutting down on fossil fuel consumption.
Building ERF plants with CHP is not always possible due to lack of available energy consumers (district heating or industrial processes), and a level of subsidy should be available for all electricity generated by these plants, whether they have CHP or not.
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ERFs with CHP can receive ROCs under the Renewable Obligation (RO). These are currently issued for the electricity generation element of co-generation, not for the heat. The operational characteristics set out in the CHPQA scheme have to be respected. However, RO support is questionable because it offers incentive for the maximum generation of electricity, not the maximisation of thermal efficiency. It was hoped that the Renewable Heat Incentive would address this, but in the consultation issued on 1 February 2010, the proposals for large installations remain uncertain.
We would like the Government to clarify the situation and support the specific development of heat networks, rather than energy conversion technologies. This will ensure that the subsidies encourage higher energy efficiency and sustainability. Subsidising less efficient energy conversion technologies will create a false economy and risk long-term failure.