The equivalent of a quarter of the total energy consumption in US industrial processes is currently wasted in the form of thermal losses from the power plants that supply them. So the scope for more industrial-scale CHP is enormous, as Jacques Beaudry-Losique from the United States Department of Energy explains.

Although attention often focuses on energy efficiency accomplishments in residential and commercial buildings, industrial energy efficiency is an area that cannot be ignored. The US Department of Energy’s Office of Industrial Technologies Program (ITP) works closely with industrial manufacturers to help them integrate energy efficiency technologies, including industrial cogeneration.

Through research and development partnerships, ITP works toward improving the efficiency of American industry. Working with energy-intensive sectors such as aluminium, chemicals, forest products, glass, metal casting, mining, petroleum refining and steel, ITP is helping to find new technology applications that can maximize industrial output while lowering energy demands and raising overall efficiency.

The CHP plant at the Malden Mills textile plant in Massachusetts quickly obtained planning permits by being designated a technology demonstration project
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As a large energy consumer, the industrial sector represents an area of potentially large energy savings. Given that the average efficiency of power generation is around 33% in the United States, the capture and reuse of the energy otherwise lost as heat represents an enormous financial boon. Thermal losses in power plants supplying energy to industry are over 6 quadrillion Btu, representing one-quarter of total energy consumption in US industry.

Industrial combined heat and power (CHP) systems are the technological answer to improving efficiency. By incorporating waste heat systems, industries of all sizes can reap the benefits of capturing energy from an industrial by-product. Heat, mechanical power and electricity can all be used in an industrial facility equipped with CHP systems.

ITP supports a CHP analysis tool on its website (see box on the next page). Developed by Oak Ridge National Laboratory and E3M Inc., this on-line evaluation software helps industry facility managers and owners decide whether CHP is right for them, walking them through the decision-making process. Many sites that use heat-intensive processes can benefit from including CHP systems in their overall energy plans.

The Department of Energy and the Industrial Technologies Program focus on practical energy savings, but also help business to navigate the regulatory and market barriers that complicate the use of these systems. Working at the regional and state level, we are building consensus for standards. Once states and utilities are working off the same ‘blueprint’, so to speak, the cogeneration market will likely expand more quickly. With greater penetration, we can achieve greater overall efficiency, while reducing total energy costs.

Success stories: how industries benefit from cogeneration

As we seek to expand understanding and use of CHP systems in the US, it is important to share success stories. The following are three examples of the types of challenges often encountered, with advice on how project managers can navigate them successfully.

Malden Mills, Lawrence, Massachusetts

In 1987, Malden Mills, a two-million square-foot (186,000 m2) Massachusetts textile plant that manufactures PolartecTM fleece clothing, was purchasing its steam and electricity from an unreliable source. Given the increasing demand for Polartec products, erratic power losses were unacceptable; this led the company’s management team to consider alternatives, such as CHP.

The company developed plans for generating its own electricity, steam and heat on-site. By 1992, Malden Mills had developed a plan for a 12 MW CHP system based on combustion turbines and fired by natural gas, for heating and possibly cooling. Over the next several years, the company waded through the discouraging permitting process with the Massachusetts Department of Environmental Protection (DEP).

DEP initially rejected Malden Mills’ application and required the plant to use an expensive, ammonia-based exhaust-gas after-treatment technology to meet the state’s new nitrogen oxides emissions standard. This prospect was both economically and environmentally unattractive to Malden Mills, and they appealed the DEP decision in 1993.

In 1995, fate changed everything. A fire ravaged the plant, leaving it nearly inoperable. CEO Aaron Feuerstein, whose grandfather started Malden Mills in 1906, drew national attention to the plight of his company by pledging to keep all of the plant’s employees on the payroll and to rebuild the plant. Reporters, politicians and even President Clinton focused on Malden Mills, and many local and national leaders offered assistance.

The DOE stepped in and advised Malden Mills that an ultra-low nitrogen-oxide CHP system based on advanced turbines would meet the state’s new requirements. The DOE then helped Malden Mills negotiate an agreement with the DEP by designating the CHP systems a ‘technology demonstration’ programme. The plant was then able to obtain hundreds of state, federal and local permits in record time. Massachusetts restructuring legislation, passed in 1997, removed the final hurdles to installation. In late 1998, Malden Mills installed two 4.3 MW commercial turbines manufactured by Solar Turbines, a partner of DOE’s Office of Industrial Technologies Advanced Turbine System (ATS) Program. A year later, both turbines were retrofitted with a ceramic combustor liner, also developed by ATS, that reduces nitrogen oxide emissions by an additional 40%.

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Besides saving Malden Mills $1 million annually, the project reduces pollutant emissions. The annual NOx reduction from the facility is equivalent to the annual emissions from 4300 vehicles. The project benefits the climate since it uses 8% less fuel, saving 52 million standard cubic feet (1.5 million m3) of natural gas annually and eliminating 3000 fewer US tons of CO2 emissions each year. This is the equivalent of planting 810 acres (330 hectares) of forest or displacing the annual greenhouse gas emissions from 270 households.

North Star Steel, Delta, Ohio

The reheat furnace at North Star Steel (NSS) is the single largest user of natural gas at the company’s Delta, Ohio plant. It consumes, on average, 80 mmBtu/hour and costs approximately US$360 per hour to operate. At this rate, assuming 20 shifts per week (essentially full-time operation) for 50 weeks per year, the fuel cost is estimated to be $2.88 million per year.

Recently, a CHP system was proposed for the steel industry to produce electric power while supplying necessary heat to the reheating furnaces. The system consists of a number of burners that use natural gas as fuel and preheated air for combustion of natural gas in several zones of the furnace. The combustion air is preheated to approximately 660°F (350°C) using a recuperator and the total firing rate is approximately 110 mmBtu/hour at the rated capacity of 90 tons/hour. The overall efficiency of the furnace, accounting for all losses, is approximately 57%.

The CHP system uses turbine exhaust gases to supply oxygen or air to the furnace burners, replacing the conventional source of air supplied from a combustion air blower. Exhaust gases from a gas turbine contain relatively high (15%-19%) levels of oxygen as volume or mass percentage. These gases can be considered as a source of oxygen for combustion of natural gas in the reheat furnaces. A detailed analysis was carried out to determine the appropriate size of the turbine that can deliver the required heat input for the reheat furnace.

Based on this analysis, it was determined that a 2 MW GE turbine would be the best match. As a point of comparison, 1 MW powers about 600-1000 homes depending on the source. The electricity produced in terms of kWh will be equal to (kilowatt electricity [kWe] rating) x (number of hours per year). For example, if the kWe rating for the turbine is 2 MWe and the number of hours per year is 8000, then total kWh savings would be 2000 x 8000 = 16 million kWh. The plant’s operation and financial information are summarized in Table 1.

The combustion system would be adjusted to maintain 2% excess oxygen (in the conventional combustion system) in the furnace exhaust gases. The furnace should be designed with an ‘unfired load preheat’ or ‘booster’ heating zone that would reduce the gas temperature to approximately 1100°F (600°C). This type of high heat-recovery furnace design is common in many newer installations.

United States Steel Corporation, Portage, Indiana

United States Steel and Primary Energy identified an opportunity to replace an existing on-site boiler house with a state-of-the-art CHP facility. Primary Energy built, owns and operates a 63 MW facility that supplies process steam, hot softened water and electricity to USS’s Midwest Plant operations.

The capacity of the cogeneration system delivers 500 kpph (500,000 pounds or 227,000 kg per hour) of steam and 330 mmBtu per hour of hot water, and commenced operation in September 1997.

The CHP system is ideal for this situation supplying 100% of the thermal energy needs and the majority of the electrical energy needs of the Midwest plant. The combined impact of replacing steam production using natural gas/fuel oil and the simultaneous production of electricity has the added benefit of reducing regional emissions by an average of 1500 tons of NOx, 2500 tons of SO2 and 380,000 tons of CO2 per year.

How far we’ve come

As of 2004, a study compiled by DOE’s Office of Distributed Energy showed that the US has achieved 81 GW of electricity generated by cogeneration, between industrial, commercial and other facilities. Approximately 2866 facilities account for this energy production, with industrial cogeneration accounting for approximately 65 GWe.

On the web, has a state-by-state breakdown of CHP installations, of which many are industrial.

In closing

Industrial cogeneration shows strong benefits for diverse facilities. As seen in the examples above, heat produced by industrial processes carries tremendous energy potential – and businesses are realizing that lots of energy is literally flying up their chimneys. The capture and reuse of even a fraction of this heat can result in energy cost savings and improved efficiencies.

The task of the Department of Energy is to help more companies discover how to tap into that power, lower their energy bills, improve their energy efficiency and promote energy independence for the common good of the United States.

Jacques Beaudry-Losique is Industrial Technologies Program Manager at the US Department of Energy, Washington, DC.

For more information, visit the Industrial Technologies Program homepage at For more about the CHP on-line analysis software, visit More case studies on industrial cogeneration may be found at

CHP Tool identifies energy savings in gas turbine-driven systems

The Combined Heat and Power (CHP) Tool is a free piece of software developed by the US Department of Energy. It allows the user evaluate the feasibility of using gas turbines to generate power, and the turbine exhaust gases to supply heat, to industrial heating systems. It also provides the estimated energy savings, system cost, payback period, and what-if analysis for various utility costs.

The tool helps the user select the appropriate turbine size to supply the required heat for the selected heating process. It is assumed that the turbine exhaust gases can be used to supply all or part of the heat required for the process. The tool can be used to size or select design parameters for a new system or to modify a system in use.

Results of the analysis include the estimated payback period for the application based on the fuel and electricity rates, costs of the turbine, engineering and installation, and annual maintenance costs of the system. The results can be used to determine whether it is worthwhile to carry out further engineering studies for the project.

The tool includes necessary performance data and default cost information for commonly used and available commercial gas turbines. If necessary, the user can change the default cost values to meet the requirements for specific applications. The tool also allows the user to modify performance data for a selected turbine or to add data for turbines not included in the database.

Tool description

This tool offers CHP application analysis for three commonly used heating systems:

  • fluid heating in fired heat exchangers – where exhaust gases form a gas turbine can be used to supply heat for indirect heating of liquids or gases in heat exchangers
  • exhaust gas heat recovery in heaters – direct heating applications where the turbine exhaust gases are mixed or injected in a furnace, oven, heater, dryer or heat recovery steam generators (HRSG), or boilers to supply all or part of the heat requirements
  • duct burner systems – use of the turbine exhaust gases for combustion of fuels such as natural gas, light oil, by-product gases in a furnace, heater, boiler, etc., where a ‘duct-burner’ is used to consume residual oxygen from the turbine exhaust gases for fuel combustion.

The CHP Tool produces summary reports with clear and detailed information on the results of the analyses. Outputs of the tool include:

  • current energy input data for the furnace/boiler
  • performance data for the selected turbine
  • energy use data for the CHP system
  • cost details for the CHP system application
  • payback period based on the cost data provided for the fuel, electricity and the equipment used in the CHP system.

Source: US Department of Energy – Energy Efficiency and Renewable Energy