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Fuel does double duty in N.Y.

Efficient cogeneration units produce electricity as well as heat

By Moises Velasquez-ManoffStaff writer of The Christian Science Monitor / March 27, 2008

Men, machine: Peter Falcier (l.) and Greg Rouse of Endurant Energy stand next to a cogeneration unit powering (and heating) a 26-story skyscraper.

Moises Velasquez-Manoff

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New York

On the 15th story of a Manhattan high-rise, a humming, room-sized box sits on a ledge. Inside, two roaring 16-piston engines fueled by natural gas generate both heat and electricity for the building. According to experts, combined-heat-and-power (CHP) generators like these will play a critical role in the future energy landscape of New York, the United States, and perhaps the world.

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The principle of CHP is to bring the power plant home. Energy that escapes up the smokestack as waste heat at a remote power plant can, when generation occurs nearby, heat (and cool) a skyscraper or a home. CHP nearly doubles the efficiency of separately generated heat and electricity, saving money, fuel, and the planet.

"It's a win-win-win in many ways," says Peter Falcier, a senior analyst at Endurant Energy, whose team developed and now manages the generators. "We're trying to do this in as many buildings as we can." [Editor's note: The original version misstated Mr. Falcier's connection with the installation.]

After a 30-year lull (CHP raised interest during the last major spike in fuel prices), it's making a comeback in New York City. Forty percent of the city's 135 units went in during the past five years, according to recent study. CEOs and co-op boards alike are looking for ways to use less fuel. Businesses, which can lose millions when computer systems go down in blackouts, increasingly see a local power source as a necessity. And as electrical demand may outstrip supply in the city soon, state and city agencies have incentivized CHP.

For at least one economist, capturing energy that would otherwise be wasted represents the belated arrival of common sense. With worry over greenhouse gases mounting, inefficiency is the "elephant in the room," says Tom Casten, chairman of Recycled Energy Development in Westmont, Ill. By his count, the nation could save $70 billion simply by harnessing the heat now going out its collective smokestacks. "We can't afford not to change it," he says. "Without a doubt, this is the cheapest power you can make."

A typical electric plant uses only one-third of its fuel's energy to push turbines. The other two-thirds are lost as waste heat. Boilers, on the other hand, can achieve up to 85 percent efficiency. By combining both processes, CHP can capture between 70 and 80 percent of the energy in the fuel. Theoretically, cogeneration delivers the same energy as separate generation, but with half the fuel and emissions. Because of close proximity to the end-user, relatively little electricity is lost in transmission.

CHP does have potential drawbacks: The technology is still expensive; larger models may be noisy; and if carbon-capture technology ever comes on line, dealing with many little flues versus a few big ones could be onerous.

Proponents say these negatives are far outweighed by the benefits: "The greatest source of renewable energy is energy you don't use," says Mr. Falcier.

A unit costs about $3 million per megawatt, he says. (A megawatt, 1 million watts, can power between 700 and 1,000 homes.) A single-home unit, like the Honda Freewatt, 60,000 of which are installed in Japan, costs about $14,000 at Climate Energy in Medfield, Mass. As a rule of thumb, CHP units are sized to provide no more than 80 percent of a building's peak energy needs, usually imagined as a hot August afternoon. Any additional power needed is drawn from the electrical grid. [Editor's note: The original version misstated the cost per megawatt.]