by Steve Hodgson
Contributing Editor, COSPP
Where, geo-graphically, does the potential for new cogeneration schemes lie? Well, that depends on whether we are talking about small- to medium-scale CHP plant usually deployed in buildings, or larger-scale CHP used at industrial sites or in district heating systems.
For the former, the potential lies in Asia and, particularly, in China, finds a new report from Pike Research, which suggests the centre of gravity for cogeneration for buildings is about to shift to China, away from the established and developed country markets of Northern Europe and the smaller established and developed country markets of Japan and South Korea. The shift to Asia has started and China, with its rapidly rising urban population, will soon lead the charge.
The same research concludes that CHP growth in the next few years will be focused on commercial-scale CHP, in which small- and medium-sized, often pre-packaged, CHP systems serve hospitals, data centres, prisons and a host of other building types. Historically, industrial-scale CHP has been a much larger market, with commercial-sector technology developing more recently on the back of advances in aeroderivative gas turbines, gas engines and, latterly, fuel cells.
The global market for commercial-scale CHP systems will reach $11 billion by 2022, with about 80 GWe of capacity installed by that year, says Pike. The driving forces, as ever, will be the potential for energy and cost savings, backed up by on-site cogeneration schemes’ ability to offer a guaranteed power supply – a critical factor for users such as hospitals and data centres. But CHP for more mainstream commercial buildings – office and retail developments – will form an increasing proportion of new schemes.
It’s not easy to discuss global trends in cogeneration in any detail, as published data is inconsistent and patchy, although trends are more easily followed in the better-documented European countries. For example, energy statistics published this summer by the UK government showed that more than 300 small-scale CHP units were installed in the UK last year – mainly in the 30–600 kWe category, as used in offices, leisure centres and hotels. The UK CHP Association says the small-scale CHP sector has been booming over recent years, growing by an average of 20% year-on-year. It now represents about 400 MW of capacity.
So where does that leave larger-scale cogeneration systems that serve industrial sites such as refineries and steel, paper and chemical plants? Both the European and North American markets have been flat for quite a few years now, and a look through recent reports of new schemes on the COSPP website suggests that much of the action here is also in Asia. Over the last few weeks, new cogeneration plants have been announced for a cement manufacturer in India as well as a steel producer and car manufacturer in Japan. News has also arrived of large urban cogen/district heating schemes for China and for Russia’s own Far East – Sakhalin Island.
However, the US may yet re-enter the fray. No less a figure than Barack Obama has signed an ‘executive order’ calling for action to achieve a national goal of developing 40 GWe of new industrial CHP capacity in the US by the end of 2020. It’s too early to tell how effective such a programme of policy co-ordination, better guidance on investment and assistance to states will be, but 40 GWe is a lot of CHP to be developed over the next eight years.
Contributing editor, COSPP