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Obama promotes CHP in the USA

US President Barack Obama wants to counter high costs involved in energy production in the industrial sector caused by lack of inefficient implementation, by promoting the development of combined heat and power on a national level.

Published: September 28, 2012:

Obama promotes chp in the usa

In the US the Efficiency quotient of the condensation energy plants has hardly increased since the 1960s. A mere 34% of implemented fuel is used to produce electricity compared with Germany which already utilizes 40 %.Therefore there is urgent need for action to enhance the electricity generation capacity from a production standpoint  to enable an efficient utilisation of energy in the USA. By initiating the Executive Order, „Accelerating Investment in Industrial Energy Efficiency“ from 30. August 2012 the Obama Administration wants to increase the installed CHP to 40 GW by 2020. According to the US Environmental Protection Agency (EPA) the existing capacity of produced electricity in the USA lies at around 82 GW. 87% of CHP capacity is installed in the industrial sector.

The stated target of the new US CHP-Initiative is to boost the competitiveness of local Industry through sinking the cost of energy production, reducing air pollution and creating new jobs in the Energy and Environmental sector.

CHP development state-wide.

CHP development is already supported in 20 states across the US by various promotion incentives. A new policy is planned to cover the whole of the USA and put combined heat and power on the map. In detail the Executive Order is set to implement the following measures:

  • Accumulating the widespread pool of interested parties and the implementation of professional workshops to promote the development and realization of best-Practice policies and terms for investment with which the many barriers of inhibition concerning investment in manufacturing efficiency in respect to CHP can be met.
  • Supportive action for federal states in their attempt to account for the real consequences involving the reduction of emissions through CHP and other steps to improve efficiency as a result of the implementation of changes to effect the improvement of national standards of air quality.
  • Creation of incentives for the implementation of CHP plants and other sustainable energy technology by appropriate regulations dealing with the trade of certified emission reduction allowances as well as grants and loans.
  • employing output based approaches as compliance options in power and industrial sector regulations, as appropriate, to recognize the emissions benefits of highly efficient energy generation technologies like CHP
  • providing general guidance, technical analysis and information, and financial analysis on the value of investment in industrial energy efficiency and CHP to States, utilities, and owners and operators of industrial facilities
  • improving the usefulness of Federal data collection and analysis
  • assisting States in developing and implementing State specific best practice policies that can accelerate investment in industrial energy efficiency and CHP

The favourable prognosis  that  the price for natural gas continues to fall and simultaneously the cost of producing electricity becoming more expensive  all  support the intentions to promote  gas-powered CHP in the USA. Due to air pollution some major coal-fired power plants will soon have to be taken from the grid and replaced by alternative power-plants,  or effectively be replaced by CHP plants.
Industry and energy suppliers enthusiastic about new developments.

 The Magazine „Cogeneration & On-Site Power Production“ (COSPP) is expecting  a huge boost for the cogeneration industry in the USA and talks of a historic executive order to increase cogeneration plants indicating the reaction of respective CHP industries. The director of the US Clean Heat & Power Association (USCHPA) Joe Allen stated: “ Establishing this national goal toward greater CHP deployment will significantly advance cleaner energy generation in the U.S., benefit the environment, and help create much-needed manufacturing and industrial jobs. Furthermore it can be said that a significant appreciation of the advantages of achieving clean power generation , increasing efficiency and creating a reliable source of energy production for the American economy by improving industry competitiveness.

Power suppliers will more than likely play a significant role within the next few years in the development and deployment of CHP in the USA. Suppliers  especially will benefit if they grasp the opportunity given to them by the order and effectively utilize  partnerships with local industries.

The potential for saving for the American industry is immense. The development of CHP would mean a reduction in the cost of energy production for the USA of more than to $10 billion a year.