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Back to the Future

Posted: July 15, 2012

A Natural Gas Utilization workshop was held in State College in June 2011. The workshop focused on three areas where expanded gas use opportunities exist: industrial, power generation, and transportation and fuels. This is the second of a three part series, highlighting these opportunities. Part two looks at power generation of natural gas opportunities for the shale gas.

Combined heat and power (CHP) is the sequential production of heat and electricity or electricity and heat from a single fuel source.  CHP systems are desirable because they save energy by recovering heat from the power generating process and using it at the site for heating, drying, cooling, or refrigeration.  Capturing what would be heat loss and repurposing it greatly improves the energy efficiency of the fuel that is powering the plant.  CHP is not a new concept; the first CHP system installed in Pennsylvania was at a paper mill in Tyrone in 1929.  Today Pennsylvania has a total of 125 CHP sites generating 3,301 MW.  Almost all of Pennsylvania’s CHP sites were installed prior to 1999.  Even though there have been few new CHP installations for over a decade, the Marcellus and other shale deposits offer an exciting opportunity for future CHP growth. 

Currently delivered fuel use efficiency from the electric grid is about 31%, and this number has been consistent for decades.  Fuel use efficiency from CHP systems often approach 65% and some installations reach 85% efficiency.  The abundance of natural gas from the Marcellus and other shale formations has already reduced the price of energy derived from natural gas.  CHP installations running on natural gas offer greatly reduced energy prices, increased efficiency from the energy production, and reduced emissions compared to other energy generation sources.  Increased installation of CHP units not only decreases the cost of energy, it creates jobs.  Along with the job creation from installing CHP sites, significantly lower energy costs would make Pennsylvania very competitive for industries looking for a low-cost operating environment.

 To read the entire Mid-Atlantic Clean Energy Application Center Report, please click here.