Combined Heat & Power Overview

Using a turn key approach, Sterling Power Systems will install, operate, and maintain a CHP unit in eligible facilities.

Sterling Power has already installed CHP's which is helping companies to reduce their environmental impact. With using a clean burning natural gas to generate heat and power this is lowering output emissions, which directly reduces their the Carbon Tax.

Benefits of Combined Heat and Power:

  • Increased operating efficiency by using the excess heat produced during power generation.
  •  85% overall energy efficiency, compared to 55% in the conventional systems.
  • Ensures continued business production by generating electricity on site, providing a secure emergency power back up option.
  • CHP's main fuel source is the abundant and highly reliable fuel source known as natural gas.


Moving Towards CHP

The issue with the way power is produced has opened up the market doors for Prime Power/Combine Heat And Power. CHP/Prime Power meets high levels of efficiency with a low scaled carbon footprint.

With this expanding market one issue is finding a company that is equipped and has the right skills to implement into these machines. Sterling Power Systems is highly skilled and knowledgeable about everything CHP.



Why Combined Heat and Power?


CHP requires less fuel to produce a given energy output. This avoids transmission and distribution losses that occur when electricity travels over power lines.

Since there is less fuel being consumed, along with both the transmission and distribution losses avoided, this means that CHP reduces emissions of greenhouse gases and other air pollutants. 

CHP can save facilities considerable money on their energy bills due to its high efficiency, and can provide a hedge against electricity cost increases and fluctuations.

The unreliability of the electricity service represents a quantifiable business, safety, and health risk for some companies and organizations. CHP is an on-site generation resource and can be designed to support continued operations in the event of a disaster or grid disruption by continuing to provide reliable electricity.



1: Efficiency Benefits,

2: Environmental Benefits,

3: Economic Benefits,

4: Reliability Benefits


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#1 Efficiency Benefits

~The average efficiency of fossil-fueled power plants in the CANADA is 33 percent. This means that two-thirds of the energy used to produce electricity at most power plants in the United States is wasted in the form of heat discharged to the atmosphere.

~By recovering this wasted heat, CHP systems typically achieve total system efficiencies of 60 to 80 percent for producing electricity and useful thermal energy. Some systems achieve efficiencies approaching 90 percent.

~The illustration below demonstrates the efficiency gains of a 5 megawatt (MW) natural gas-fired combustion turbine CHP system compared to conventional production of electricity and useful thermal energy (i.e., purchased grid electricity and thermal energy from an on-site boiler).

Conventional Generation vs. CHP: Overall Efficiency

~This is an example of a typical CHP system. To produce 75 units of electricity and useful thermal energy, the conventional system uses 147 units of energy inputs-91 for electricity production and 56 to produce useful thermal energy-resulting in an overall efficiency of 51 percent. However, the CHP system needs only 100 units of energy inputs to produce the 75 units of electricity and useful thermal energy, resulting in a total system efficiency of 75 percent.

~A CHP system's efficiency depends on the technology used and the system design. The five most commonly installed CHP power sources (known as "prime movers") offer these efficiencies:

  • Steam turbine: 80 percent
  • Reciprocating engine: 75-80 percent
  • Combustion turbine: 65-70 percent
  • Microturbine: 60-70 percent
  • Fuel cell: 55-80 percent

Avoided Transmission and Distribution Losses

~By producing electricity onsite, CHP also avoids transmission and distribution (T&D) losses that occur when electricity travels over power lines. Within the five major power grids in CANADA, average T&D losses vary from 5.82 percent to 7.38 percent, with a national average of 6.18 percent .

~Losses can be even higher when the grid is strained and temperatures are high. By avoiding T&D losses associated with conventional electricity supply, CHP further reduces fuel use, helps avoid the need for new T&D infrastructure, and eases grid congestion when demand for electricity is high.

#2 Environmental Benefits

~CHP systems offer considerable environmental benefits when compared with purchased electricity and thermal energy produced on site. By capturing and utilizing heat that would otherwise be wasted from the production of electricity, CHP systems require less fuel to produce the same amount of energy.

~Because less fuel is combusted, greenhouse gas emissions, such as carbon dioxide (CO2), as well as other air pollutants like nitrogen oxides (NOx) and sulfur dioxide (SO2), are reduced.

~The following diagram shows the magnitude of reduced CO2 emissions of a 5 megawatt (MW) natural gas-fired CHP system compared to the same energy output from conventional sources.

Conventional Generation vs. CHP: CO2 Emissions

Conventional Generation vs. CHP: CO2 Emissions

#3 Economic Benefits

CHP can offer a variety of economic benefits, including:

  • Reduced energy costs: CHP reduces energy bills because of its high efficiency. By using waste heat recovery technology to capture wasted heat associated with electricity production, CHP systems typically achieve total system efficiencies of 60 to 80 percent, compared to 50 percent for conventional technologies (i.e., purchased utility electricity and an on-site boiler). Basically less fuel is needed for a given unit of energy output. Also, because CHP systems typically use natural gas which is often cheaper than purchased electricity, CHP can help reduce electricity bills. Bills are further reduced because the CHP output reduces electricity purchases.


  • Avoided capital costs: CHP can often reduce the cost of replacing heating equipment.


  • Protection of revenue streams: Through onsite generation and improved reliability, CHP can allow facilities to continue operating in the event of a disaster or an interruption of grid-supplied electricity.


  • Less exposure to electricity rate increases: Because less electricity is purchased from the grid, facilities have less exposure to rate increases. In addition, a CHP system can be configured to operate on a variety of fuel types, such as natural gas, biogas, coal, and biomass; therefore, a facility could build in fuel switching capabilities to hedge against high fuel prices.

Analyzing Economic Feasibility

~The economic benefits of any CHP project are dependent on electricity rates, system design, equipment cost and CHP operating practices. The value of the benefits will depend on the needs and goals of the investor. A feasibility analysis is conducted to determine the technical and economic viability of a project.

#4 Reliability Benefits

~In addition to reducing operating costs, CHP systems can be designed to continue operating in the event of grid outages to supply continuous power for critical functions.

~Interruptions of grid-supplied electricity service represents a quantifiable business, safety, and health risk for some facilities.


  • The first step in incorporating CHP into a strategy to reduce business risk is to calculate the value of reliability and risk of outages for a specific facility.
  • After identifying and quantifying (in monetary terms) the value of reliable power to facility operations, the costs of designing and configuring CHP technology for outage protection can be estimated and evaluated. CHP systems can be configured to meet the specific reliability needs and risk profiles of any facility.

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