CHP 101

This post is the first installment of a series related to Combined Heat and Power (CHP).  This short post provides basic background information on CHP to set the stage for future (and more interesting) posts on CHP.

A Combined Heat and Power (CHP) or cogeneration system is a system that produces both electric power and useful heat from a single source of energy.  Although CHP power plants provide only a small fraction of electric power produced in Indiana, the concept of CHP actually predates the more typical centralized power generating stations that we generate most of our power from today.  Thomas Edison’s first permanent power station in New York City actually provided both electricity and steam to its customers.

CHP benefits its users by providing energy to their facility more efficiently than the power grid.  This increased efficiency can result in power that is cheaper, cleaner, and more reliable than power from the grid.  Also, the user may have the ability to use a locally sourced or renewable fuel (e.g. digester gas or landfill gas) to meet their energy needs.  Typically, CHP systems are located immediately adjacent to the facilities which they power and heat, reducing the need for excessive infrastructure to deliver the energy.

A wide variety of well-proven commercial technologies can be employed in a CHP application.  The most common options are reciprocating engines (recips), gas turbines, microturbines, and steam turbines.  The choice of technology depends on the application.

The US Department of Energy has a massive amount of information available on CHP, so instead of diving deeper here, I’ll encourage readers to visit the DOE CHP site.  Also, you can find out more about what’s happening locally by visiting the Midwest CHP Technical Assistance Partnership website.

We’re excited about the ability of CHP to lead Indiana to a cleaner, more reliable, and price-based electricity market.  Continue to join us in the coming weeks as we dive deeper into the technology, economics, politics, and future of CHP.  Please don’t hesitate to give this posting a “Like” as we work to empower Hoosier businesses with a more fully considered energy future.

 

 

This Week in Indiana Electricity

This week delivers the biggest news in the Indiana electricity market this year–the official passage of SB 340 and the demise of energy efficiency mandates including Energizing Indiana. At first pass, this looks like a huge mistake and a major setback for energy efficiency, demand side management, and a more fully considered future for supply and delivery of electric power to Hoosier homes and businesses.  At second pass… it still looks like a huge mistake and a major setback (to me).

Here are some thoughts from those closest to the situation:

Gov. Pence lets energy program expire without signing bill

Some businesses revolt over pulling plug on energy efficiency

I&M to continue energy efficiency programs to save money, energy

This non-decision by Governor Pence leaves us waiting for the state’s energy plan later this year to get any idea of his plan for energy efficiency, renewable energy, distributed power, etc. to meet our future power needs. There have been a lot of references to SB 340 being a pause button for energy efficiency measures.  A lot of folks are understandably nervous about when and how that button will be released.

There is an immediate bright side to the end of an energy efficiency mandate. The millions of dollars that our large manufacturing firms have been paying to support this program will soon be free for investment into energy and cost savings projects that make sense for them. This pressing of the pause button may be the final poke needed to deliver alternative energy technologies like solar and combined heat and power (CHP) to the Hoosier market at a big scale.

In light of this development, we’re going to discuss these options over next several weeks and help the power users of Indiana better understand the opportunity they may have. If you want to get  a head start on your alternative energy project, please contact us today by calling 317-860-4410 or by using the form below.

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Indiana Biomass Energy Working Group Event Announcement

MacAllister Power Systems is proud to be a part of a great event from the Indiana Biomass Energy Working Group at Purdue University.  The group will be hosting an educational seminar and tour of the Homestead Dairy anaerobic digester and power generation facility.  This will be a great event for anyone interested in biogas energy.  Details are as follows:

Plymouth, IN  April 23, 2014  8:30 a.m. to 3:00 p.m.

This session of the Indiana Biomass Energy Working Group, will kick off at the Christos’ Banquet Center in Plymouth, IN.  Anaerobic Digestion Experts and project developers will provide information on the newly installed anaerobic digester technology located at the Homestead Dairy, LLC facility followed by a tour of the digester site just south of Plymouth off U.S. 31.  This unit is using waste streams from the dairy waste and other substrates with a 1.2 MW capacity of renewable electrical power to Indiana residents through NIPSCO power company.

Speakers Include: Dr. Jiqin Ni-Purdue University Ag & Bio Engineering Andy Tauer-Indiana Soybean Alliance Ken Jones-Jones Petrie Rafinski, MacAllister Power Systems/Caterpillar, NIPSCO, Ryan Rogers-Homestead Dairy Green Energy.

Contact us using the form below to register for this event or to learn even more about this project.

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This Week in Indiana Electricity

This has been an interesting week for news about electricity in Indiana. We’ve seen a little bit of everything from good news to bad news (or vice versa depending on your perspective) on power costs and opportunities.  Here are a few of the top headlines.

Appeals court upholds 16 percent rate increase for Duke customers

Power deal: ‘Why not Richmond?’ RP&L, IMPA explain needs, benefits of generation transfer

Power Falls From Midwest to Northeast on Demand Below Forecast

The debate continues on SB340 and the future of energy efficiency in Indiana…

Who’s behind the effort to kill Indiana’s efficiency law?

And then there’s this little nugget from our former Senator and Governor. There are some good points in here for sure, but it’s a little oversold for me…

Former Democratic Senator says that the U.S. needs to embrace nuclear power

The major takeaway here is that electricity markets are volatile at the utility level, but increases in customer rates are going to continue to be necessary to cover the cost of generation. The good news is we’re seeing new opportunities for old plants like the one in Richmond to see new life, and we’re at the front end of a new discussion about nuclear. Also, it’s going to be interesting to see how the utilities and big power consumers respond to the end of Indiana’s energy efficiency mandate. It looks like a loss for demand side management in the short term, but it could light the path for some big power users to make some serious internal investment in energy efficiency and distributed generation.

Either way, there’s a lot going in here in the Hoosier state. Stay tuned as we start to take a look at some opportunities that businesses have to take control of the reliability, cost, and environmental footprint of their power supply.  If you want to get  a leg up on your energy savings plan, please contact us today by calling 317-860-4410 or by using the form below.

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Save $8,075 in Energy Costs the Easy Way: Do Nothing!

Most business owners and managers have a great understanding of their energy costs, and have done everything they can to bring them down. If you’re in that majority, then this story probably isn’t worth your time. For those few of you out there that just pay your energy bills without much question, I hope this example gets you thinking about the unnecessary money you may be spending each month.

Recently, a mid-sized grain handling company in Indiana contacted MacAllister Power Systems to get a handle on their high cost of energy. Their electric power provider had just increased their power rates by about 25%, and they wanted to take a look at generating some of their own power to offset the cost.

Before rushing in and selling them a generator, we performed a study on their power usage. The graph below shows what we found.

During the 2013 harvest season, the facility had a high peak during October and November. After talking with the owner, we realized that these peaks were due to an unintentional use of equipment. The staff had no way of knowing how much power they were using, so they didn’t know that they were setting the peak demand for the month. The data shows that this unnecessary peak was about 200 kW in October and 275 kW in November. At a rate of almost $17 per kW, the costs of those peaks were $3,400 and $4,675, respectively.

Based on this finding, the owner was able to show his team what was happening and put instructions in place to prevent it from happening again. The net result: $8,075 of cost savings every year, by doing nothing.

If you’ve not taken a deeper look at your energy costs recently, use the form below or call 317-860-4410 to talk about a Power Study from MacAllister Power Systems.

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A Conversation on Energy in Indiana

Why would anyone want to talk about energy in Indiana? We have a reliable energy system, and our power utilities deliver cheap, reliable power. We have an abundance of coal right here in the state that can meet our needs for generation to come. We have great access to natural gas, with a number of national pipelines running through our backyard. The state doesn’t have much more opportunity for solar or wind power, with the cost of those technologies, and we certainly don’t need to talk about nuclear power. It’s pretty simple. There’s just not much to talk about. Our rates are among the lowest in the country. Our average electricity rate in 2012 was 8.3¢/kWh, 14th lowest in the country. Wait, that doesn’t seem so great. In 2001 we were 6th at 5.3¢/kWh. That’s a dubious trajectory. Well, still, our industrial rates have stayed low to protect our manufacturing jobs. In that area we’re ranked 23rd at 6.3¢/kWh. Oh, that’s even worse. Where is this headed? The State Utilities Forecasting Group from Purdue predicts our rates in 2022 will be 8.6¢/kWh. That’s going to rank us about 40th in the nation, just ahead of the high energy cost states along the coasts. At that point, why would anyone build a new plant here? Why would anyone who is here now want to stay? What’s going on? Hoosiers get about 85% of their power from coal. Even though the stuff is cheap, it’s getting more expensive to burn every day. Our lopsided investment into coal power has made us vulnerable in a world that pays more attention to the quality of the air it breathes and water it drinks. Natural gas gives us a cleaner option, but still has emissions and limitations. Solar and wind may be more abundant than we had considered, given these new conditions and lower cost technologies that are hitting the market. Also, we have a massive amount of wastes of all types that can be processed for energy, if we can make the economics work. Nuclear…that one’s going to be a hard sell for some time to come. There’s plenty to talk about when it comes to energy in Indiana. The situation we’re in has been well forecast for quite some time. Our utility and government leaders have never really taken their eyes off these issues, but we’ve reached a point of great concern nonetheless.  It’s time for everyone to consider their options and be a part of a more fully considered future. So, let’s have a conversation. We want to share the lessons that we’re learning as we help Hoosier businesses continue to operate and grow despite the changing business climate. We hope that those lessons empower other businesses to take control of a rising concern that, until recently, only got a fleeting mention. We’re looking forward to some great feedback from the state’s energy stakeholders. We’re excited to be a part of the process that moves the state to a long-term sustainable energy supply. Also, let’s not be shy about the fact that this is our business. We hope that we can use this conversation to reach new clients and find new ways to deliver products and services to market, because we believe that everybody wins when we do.