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micro CHP

NigelE | Posted in Expert Exchange Q&A on

I’m starting to look at microCHP for residential homes of ~ 2500 sf and <5 kW. 

My understanding is that for gas heated buildings the mCHP will not compete with condensing boilers with >90% thermal efficiency, BUT will provide resilience with combined electrical generation (~ 2kW).   

My question is in what regions/markets have these types of units been sold? 
And why is the mCHP market apparently so small? 

Thanks.

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Replies

  1. paul_wiedefeld | | #1

    If I had to guess, installation price, efficiency, and total addressable market.
    A new combined cycle plant of 1GW is about 50% efficient and costs about $1/W. Paired with heat pumps, the efficiency easily exceeds a furnace or boiler. Roughly, 1.5BTUs out for every 1BTU in. Newer combined cycle plants in the US have high utilization.
    A microCHP like Axiom's has a higher efficiency, but most of its output is thermal, not electrical, so it's less useful. According to their website, math works out to be: 42,000btu thermal + 4.4kw, which works out to about 1.33BTU out for every 1 BTU in with the same heat pump as above. It's also not going to cost $1/w and utilization will be much lower than a combined cycle unless you have someplace to use the heat. So the microCHP loses on fuel costs, capital costs, and likely maintenance costs. You get the resiliency piece, but it's a rather small generator and could be cheaply substituted for. Even if there was a payback, you have to stay in the house long enough to collect it - currently it looks like there's zero resale value for these systems.

    The addressable market is the biggest issue for the microCHP in my opinion. To get the utilization high, you need a constant thermal load, which isn't very common outside of larger institutions or huge homes in cold climates. It helps if you have hydronic heat, which isn't common in the US but is more common in the Northeast at least. It also helps if you have high electric distribution costs but low gas distribution costs. The Northeast has pretty high electric distribution costs, but also uses a lot of fuel oil for heating, so the market would probably exclude all oil burners. I think it works best for apartment building DHW if tenants don't pay for that themselves, since that's year round and rather consistent.

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