Micro Combined Heat and Power Systems – Evaluation of a Sample Application

The growing need for a secure, cost-effective, less polluting and efficient form of energy has contributed to an increasing interest in the use of micro combined heat and power (MCHP) systems. In this paper, the environmental performance and economic feasibility of a 1 kWe internal combustion engine (ICE) MCHP system in a one-family house was assessed and compared with the baseline scenario were residential energy demands are met with grid electricity and natural gas fired condensing boilers. The result of the analysis shows that MCHP systems present opportunities for savings in energy costs. Based on a social discount rate (SDR) of 5 % and a calculated 3259 operating hours, a simple payback period of about 4.8 years was derived as the time needed to recover the extra investment cost of the ICE unit. The result of the sensitivity analysis reveals that, both the running hours and price of electricity have significant effects on the payback period of the project. Considering the end of useful life period of the systems, MCHP offer a good replacement for conventional gas boilers of 90 % efficiency. However, their high initial costs (when compared to high efficiency condensing boilers), could be seen as the major factor hampering market diffusion. Also, considering the optimal environmental benefits, MCHP system produced more on-site CO2 emissions in reference to the condensing boiler but generally, annual CO2 emission is reduced by about 38 % when compared to the overall separate generation of heat and power scenario.