by Shane Henson — October 3, 2012—Utilities across the country could use highly efficient combined heat and power (CHP) to more cheaply replace a substantial portion of the coal-fired electric-generating capacity expected to retire in the near term, according to the Coal Retirements and the CHP Investment Opportunity report issued by the American Council for an Energy-Efficient Economy (ACEEE).
CHP systems use a single fuel source to concurrently produce electricity and thermal energy. Heat is a byproduct of most electricity generation, but while traditional power plants waste that heat by releasing it into the air or nearby water, CHP systems capture it and put it to productive use, such as generating steam that is then used in manufacturing processes, the report explains.
This report targets 12 U.S. states and ascertains the likely amount of coal-fired electric capacity to be retired in the near term plus the potential for CHP to meet some of that lost capacity. According to the report, coal-dependent states like West Virginia, which expects to see up to 11 percent of its total electric-generating capacity retire, could replace about one-third of that lost generation with utility-owned CHP. Alabama and North Carolina could replace over half of their retiring coal plants with CHP. States with smaller levels of expected coal retirements, such as Kansas and South Carolina, could reportedly replace all of their lost capacity with CHP. Other states included in the report are Colorado, Georgia, Indiana, Iowa, Kentucky, Louisiana, and Ohio.
Coal-powered generation is becoming increasingly uneconomic due to several factors, says ACEEE: the increased cost of coal; the decreased cost of alternatives like natural gas; an aging and inefficient coal fleet; and the impact of new and forthcoming air quality regulations, which aim to reduce toxic pollutants and other substances harmful to human health and the environment. An estimated two to five percent of U.S. electric-generating capacity will retire due to the above impacts, most of it in the form of older and smaller coal plants that were built over two generations ago.
“Our report suggests that instead of investing in new centralized power plants, utilities should invest in new CHP plants to keep costs down for their customers and generate much cleaner electricity,” said Anna Chittum, the report’s lead author. “Utilities around the country have expressed concern about the amount of coal-fired capacity they believe they will need to retire in the near future. Many are asking for substantial increases in customer rates to pay for new investments in traditional power plants when they could be investing in CHP instead.”
