Cogeneration could benefit from RPS standards

WASHINGTON, DC, US, September 6, 2006 (Refocus Weekly)

The cogeneration industry should use Renewable Portfolio Standards as a policy tool to advance the industry, suggests the American Council for an Energy Efficient Economy.

“Although many states have been making notable progress on combined heat & power policies, significant barriers continue to hinder the realization of CHP’s nationwide potential,” explains ACEEE in ‘Combined Heat & Power: Connecting the Gap between Markets & Utility Interconnection and Tariff Practices.’ “In particular, individual utility policies and practices, especially relating to interconnection and tariffs, have long been identified by ACEEE and others as a major barrier to the expanded adoption of CHP.”

The report examines utility policies across the U.S. relating to cogeneration and distributed generation, to identify utility barriers to entry for proposed CHP facilities. It also identifies current CHP policies on a state-by-state and regional basis, and highlights “the most appropriate policy options that might help the CHP industry move forward.”

The first part of the report focused on utilities in 15 states and identified some of the main barriers to new projects including interconnection, tariff rates, safety issues, spark spread, utility awareness of CHP benefits, and disincentives for utilities caused by utility regulation. This second part focuses on the remaining states, and provides national and regional perspectives.

A renewable portfolio standard is a market-driven policy to require that a minimum amount of green power is included in the portfolio of electricity resources within an area, it explains. The concept “has been evolving for many years, with legislation having been introduced for over a decade at the national level and, to date, 20 states and Washington DC have implemented minimum renewable energy standards.”

“Recently, we have seen a few instances where either existing or proposed RPS’s have included CHP and energy efficiency as qualifying under the standard,” noting that Pennsylvania, Connecticut and Hawaii are examples of states with RPS’s that include CHP.

“This trend could be a valuable opportunity for encouraging further integration of CHP into the market and market-driven policy,” the report notes. “The CHP community should pay close attention as to how to best use this as a policy tool to move the CHP industry forward.”


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