Asia, Cogeneration CHP, Europe

The DG revolution

Foundations, especially Rockefeller Brothers and Ford, among other organizations, refused to accept starvation as a given and funded the ‘International Maize and Wheat Improvement Center’, home of 1970 Nobel Prize winner Norman Borlaug. These research efforts produced new strains of wheat and rice that responded to fertilizer and were resistant to disease. The green revolution enabled farmers to increase food production faster than population growth, and truly initiated a miracle for the people who were starving in India and China.

ELECTRICAL POWER STARVATION

Flash forward to the late 1990s. Roughly one third of the world’s six billion people, many in India, are without electrical power, an absolute essential to modern life. Studies have shown that access to electricity produces increases in standards of living and women’s rights and it reduces population growth rates. But the conventional approach of producing electricity in remote central plants that feed vast webs of copper wires is not delivering the goods to one out of three people on the planet.

Power from India’s 108 GW of central electricity generation capacity flows to users through overtaxed wires that leak power, losing 40%-50% of generated power to technical losses and theft. The Indian economy has many elements in place for rapid economic growth – common market comprising 600 million people, good levels of education, and solid basic industry – but these losses and widespread electricity shortages block progress, and the central government has embarked on ambitious plans to modernize, add capacity, reduce theft and line losses, and extend power to all households by 2012.

THE INDIAN DG REVOLUTION

Here is the breaking news. Once again organizations, notably Winrock International and Rockefeller Brothers’, have stepped up, refusing to accept electricity starvation as inevitable. Three other organizations, the Cogeneration Association of India (Cogen India), USAID and the World Alliance for Decentralized Energy (WADE), agreed to help. These organizations have started another revolution – the distributed generation or DG revolution. They provided information, technical assistance and financial support. They have helped the Indian sugar industry recycle bagasse as electricity for a nation starved of power. (Bagasse is the residue after sugar cane has been pressed to remove the juice.) They have persuaded India’s state electricity boards to modernize electricity regulatory rules, which were blocking more efficient and cleaner local power.

The prospects for CHP’s development in Europe have started to improve, albeit from a low base, argues Klaus Traube. New micro-technology, rising electricity prices, the CHP Directive and the approach of emissions trading have all contributed to a brighter medium-term outlook. The ability of decentralized CHP to improve energy security is also important.

In 1997 the European Commission presented a report on a common strategy for the promotion of cogeneration (CHP), emphasizing that CHP is one of the few technologies that could, in the short term, render an important contribution to enhance energy efficiency in the European Union (EU). However, noting that its potential was widely underused, the report underlined the need to remove the barriers that prevented the adequate exploitation of the potential for CHP in most of the Member States. These barriers had caused a decrease of the CHP share in the electricity generation of the EU since the 1970s. The Commission proposed a policy with the aim of doubling this share, from then 9% to 18% by 2010.

The European Council approved the report but the proposed strategy was not implemented. Since then, the share of CHP electricity in the EU has continued to stagnate, or decrease even further, due to the decline of wholesale electricity prices in the first years after liberalization of the electricity market.

As emissions trading starts, will CHP development finally reach a point that reflects its benefits?

More recent developments seem to indicate that the conditions for CHP in Europe have now started to improve. Wholesale electricity prices have been rising again. The European Parliament and the Council passed the long-awaited Directive on the promotion of cogeneration in January 2004. Next year, emissions trading will start in the EU. Will the development of CHP finally reach a point that reflects its benefits? We cannot know now, but in this article we will examine the parameters that will influence the further development of CHP in the short and medium terms – driving forces and barriers, benefits and technical potential.