Combined Heat and Power 

Efficient Energy for Local Governments 

Local governments are using combined heat and power (CHP) to 

reduce their operating costs, provide a hedge against volatile 

energy costs, increase their energy efficiency, and reduce 

emissions of greenhouse gases and other pollutants from the 

combustion of fossil fuel. 

What Is CHP? 

CHP, also referred to as cogeneration, is an efficient, clean, and reliable 

approach to generating electric power and useful thermal energy from a single 

fuel source. CHP systems achieve fuel­use efficiencies of 60 to 80 percent, compared to average fossil­fueled power plant efficiencies of 33 percent in the 

United States. This significant efficiency benefit occurs because CHP applications involve the recovery of otherwise wasted heat to produce additional power 

or useful thermal energy for heating, cooling, or other mechanical processes. By 

making use of the waste heat from onsite electricity production, CHP increases 

energy efficiency and decreases energy costs. 

CHP is not a specific technology, but an application of technologies to meet an 

energy user’s needs. These technologies include reciprocating engines, combustion or gas turbines, steam turbines, microturbines, or fuel cells as the prime 

mover and fossil fuels, biomass, or biogas as the fuel source. The thermal energy 

from CHP systems can be used in direct process applications or indirectly to produce steam, hot water, hot air for drying, or chilled water for process cooling. 

Where Can Local Governments Use CHP? 

Local government facilities can utilize CHP systems in: 

• Wastewater treatment facilities 

• Landfills 

• Government buildings 

• District energy systems 

• K­12 schools and community colleges 

• Hospitals and health centers 

What Is the EPA CHP Partnership? 

The U.S. Environmental Protection Agency (EPA) CHP Partnership is a voluntary 

EPA­industry effort designed to foster cost­effective CHP projects. The goal of 

the CHP Partnership is to build relationships among EPA, the CHP industry, state 

and local governments, and other stakeholders to expand the use of CHP. 

Through 2006, CHP Partners installed more than 3,550 megawatts (MW) of 

CHP with Partnership assistance. The resulting carbon dioxide emission savings 

Is My Facility a Good 

Candidate for CHP? 

If you answer “yes” to 3 or more of 

these of these questions, your facility may be good candidate for CHP. 

• Do you pay more than $0.06/kilowatt hour (kWh) on average for 

electricity (including generation, 

transmission, and distribution)? 

• Are you concerned about the 

impact of current or future 

energy costs? 

• Is your facility located in a 

deregulated electricity market? 

• Are you concerned about power 

reliability? 

• Does your facility operate more 

than 5,000 hours per year? 

• Do you have thermal loads 

throughout the year (including 

steam, hot water, chilled water, 

process heat, etc.)? 
are equivalent to removing the annual emissions of more 

than 1.7 million automobiles. 

What Resources Are Available? 

Education and Outreach 

The CHP Partnership provides information for regulators, 

policymakers, and utilities to encourage energy efficiency 

and CHP, as well as peer­to­peer marketing and networking at workshops and conferences. Models of state policies for promoting CHP, such as output­based emission 

regulations, CHP­friendly utility rates, and renewable 

portfolio standards that include CHP are also maintained 

online and in various Partnership publications. 

Technical Assistance 

The CHP Partnership has developed services and tools to 

assist those considering implementing CHP at their facilities. Visit the Streamlining Project Development 

pages of the Partnership Web site at www.epa.gov/chp/ 

project­development/index.html to learn more about the 

CHP project development process, whom to involve on 

your CHP project team, typical options for system financing, and other services EPA provides. 

Project Resources 

Take advantage of the CHP Partnership’s up­to­date lists 

of state and federal incentives (e.g., rebates, tax credits, 

loans, grants) for CHP, along with lists of regulatory rules 

and rates that are advantageous to clean distributed 

generation. This information is updated monthly on the 

Funding Resources pages of the Partnership Web site 

at: www.epa.gov/chp/funding/funding.html. 

Public Recognition 

EPA’s ENERGY STAR CHP Award recognizes highly efficient CHP projects that achieve fuel and emission savings 

over comparable state­of­the­art separate heat and 

power. EPA accepts award applications continuously and 

presents these awards at key events. For more information on applying for an ENERGY STAR CHP Award, visit 

www.epa.gov/chp/public­recognition/awards.html. 

CHP in Use in Local Governments 

More than 800 municipal governments currently use CHP, 

generating over 6,300 MW of electricity. The following 

case studies from local governments provide examples of 

recent successful CHP installations. 

District Energy Saint Paul 

St. Paul, Minnesota 

District Energy Saint Paul’s 25 MW CHP plant captures the 

waste heat from a wood­fired power plant, reducing 

District Energy’s reliance on coal by 80 percent, soot emissions by 50 percent, and greenhouse gas emissions by 

280,000 tons each year. The resulting carbon dioxide 

emission savings are equivalent to removing the annual 

emissions of more than 200,000 automobiles. The CHP 

plant heats more than 170 buildings and 300 single­family 

homes, representing over 29 million square feet of building space, or about 80 percent of Saint Paul’s central business district. The reduced energy use saves customers 

$32 million each year, and the savings increase as natural 

gas prices rise. 

The plant was completed in 2003 and uses urban wood 

waste as a fuel source, thereby diverting items from the 

local waste stream. 

Essex Junction Wastewater Treatment Facility 

Essex Junction, Vermont 

Essex Junction’s wastewater treatment facility uses two 30 

kilowatt (kW) microturbines to generate electricity and 

thermal energy from the methane gas produced by its 

digester. Before CHP was installed, the plant used only half 

of the methane it produced. Now the plant uses 100 percent of the methane produced to heat the anaerobic 

digester, saving 412,000 kWh and $37,000 each year. 

These energy savings represent 36 percent of the facility’s 

electricity demand. The project has an estimated payback 

of seven years. 

For more information about the EPA CHP Partnership, including how to join, contact: 

Neeharika Naik-Dhungel, Program Manager

 Tel.: (202) 343-9553

 Fax: (202) 343-2362

E-mail: naik-dhungel.neeharika@epa.gov

 Web site: www.epa.gov/chp