Promote district energy and Combined Cooling, Heating and Power Systems
The State should promote district energy and combined cooling, heating and power systems. District energy systems supply thermal energy (hot water, steam and/or chilled water) to buildings from efficient central plants through a network of underground pipes. Many downtown areas, colleges and hospitals are served by district energy systems, and there is significant potential to serve new high-density development with district systems.
District energy provides many opportunities to increase energy efficiency, use renewable resources, enhance power grid reliability, and increase our national security. Key energy- efficiency opportunities include recovery ("recycling") of waste heat from power generation through combined heat and power (CHP), industrial processes or municipal operations, and superior efficiency through state-of-the-art technology and controls. Major renewable-energy opportunities include bio-energy, geothermal and natural sources of air conditioning such as the use of lake or ocean water.
By using recycled energy or renewable sources, district systems can make significant contributions toward reducing reliance on fossil fuels and toward cutting emissions of air pollution and greenhouse gases. District energy systems boost reliability and energy security by cutting peak power demand by meeting air conditioning demand through delivery of chilled water, shifting power demand through thermal storage and generating power near load centers. District energy systems also enhance national security and boost local economies by tapping local energy resources.
The best way for the State to encourage district energy systems is to lead by example. State governments operate numerous buildings and facilities. The State should assess its current inventory of buildings for their potential to be incorporated into district energy systems, as well as evaluate the feasibility of developing district energy systems in those locations.
To encourage local governments and private institutions to consider district energy systems, States should provide information and education about them to government officials, developers, planners, architects and engineers. City and county governments can be become important allies if the State:
- provides information on the benefits of district energy and CHP and how to evaluate and implement community energy system opportunities, including training workshops and computer simulation tools;
- provides technical assistance and cost-shared funding for community energy resource assessments and district energy feasibility studies; and
- develops and operates an information clearinghouse on district energy system implementation.
Developers, planners, architects and engineers can become stronger advocates of district energy systems if provided with training materials, technical guidebooks, computer simulation tools and other programs that provide information on how district systems work and how to integrate them into development plans and designs.
States also can:
- ensure that CHP facilities are given fair and reasonable access to the electricity grid for purchase of stand-by power and sales of power to the grid without unreasonable fees;
- encourage waste heat utilization by including CHP in its power generation portfolio standard;
- provide information and incentives for new or existing waste heat generators to (re)locate adjacent or close by to heat sinks. A key first step is an inventory of waste heat resources, identifying how much and where waste heat exists, how much of the heat is useable (of high enough quality) and how much is feasible to recover (near enough users of heat);
- include these types of energy-efficient infrastructure in grant and loan programs, tax credit programs, and other incentive measures; and
- mandate integrated planning and policy development by state agencies charged with power utility planning and regulation, waste management, energy efficiency, air quality, and other relevant concerns. Such planning should include evaluation of the State's full renewable thermal energy potential, including a comprehensive assessment of bio-energy resources, geothermal heating, and the potential to use natural sources of air conditioning from cold deep surface water.
- Pennsylvania's Alternative Energy Portfolio Standard (AEPS)
Pennsylvania's Alternative Energy Portfolio Standard requires that an annually increasing percentage of electricity sold to retail customers in the State come from alternative energy sources. In 2004, Pennsylvania Governor Edward Rendell signed Act 213, which created two tiers of alternative sources. The standard calls for utilities to generate 3.5 percent of their electricity by using Tier I energy sources and 6.2 percent by using Tier II sources by 2012. Tier II could include certain forms of combined heat and power systems.
— Pennsylvania's Alternative Energy Portfolio Standard (AEPS)
- Connecticut's Energy Independence Act
In 2005 Connecticut enacted Connecticut House Bill 7501, "An Act Concerning Energy Independence," that includes numerous provisions that encourage CHP, including a New Efficiency and CHP Portfolio Standard. The law provides incentives for local electric utilities to purchase the excess electricity from CHP facilities rated less than 65 MW and sets up a funding mechanism to support the program.
— Connecticut General Assembly