Combined Heat & Power (CHP)
Opportunities for Hospital Facilities
Iowa Society of Healthcare Engineers (ISHE)
September 18, 2014
Cliff Haefke
www.midwestcleanenergy.org
What technology can…
o Increase overall energy efficiency and reduce utility bill
expenditures?
o Reduce carbon emissions?
o Increase energy reliability, decrease reliance on the grid, and
support grid T&D?
o Show more energy savings and reduce more emissions than
comparably sized PV and wind technologies?
o Support nation’s energy goals and is commercially available today?
The Answer? CHP
6
Why CHP in Hospitals?
o Healthcare organizations spend > $6.5B annually
o Every $1 a non-profit healthcare organization saves on energy is
equivalent to generating $20 in new revenues for hospitals
o For-profit hospitals can raise their earnings per share 1¢ by reducing
energy costs just 5%
o CHP systems can reduce energy costs and carbon emissions
o CHP systems can maintain hospitals’ power and heat during manmade and natural disasters
o 200+ hospitals operate CHP systems today
o 7 of Top 16 U.S. hospitals use CHP according to US News
1)ENERGY STAR - http://www.energystar.gov/ia/business/challenge/learn_more/Healthcare.pdf
2) DOE CHP Installation Database
3)US News’ 2013-2014 Honor Roll of the Nation’s Top 18 Hospitals:(John Hopkins, Mass. General, Mayo Clinic, Cleveland Clinic, NY
Presbyterian, NYU Langone, Indiana University)
7
US DOE CHP Technical
Assistance Partnerships (TAPs)
o U.S. DOE CHP Technical Assistance Partnerships (TAPs)
originally established in 2001 by U.S. DOE and ORNL to
support DOE CHP Challenge (formally known as RACs and
CEACs)
o Today the 7 TAPs promote the use of CHP, District Energy,
and Waste Heat to Power Technologies
o Strategy: provide a technology outreach program to end users,
policy, utility, and industry stakeholders focused on:
– Market analysis & evaluation
– Education & outreach
– Technical assistance
o Midwest Website: www.midwestCHPTAP.org
8
DOE CHP Technical Assistance Partnerships (CHP TAPs)
NORTHEAST
www.northeastCHPTAP.org
MIDWEST
www.midwestCHPTAP.org
Dave Sjoding
Washington State University
360-956-2004
sjodingd@energy.wsu.edu
John Cuttica
University of Illinois at Chicago
312-996-4382
cuttica@u ic.edu
Cliff Haefke
University of Illinois at Chicago
312-355-3476
Tom Bourgeois
Pace University
914-422-4013
tbourgeois@law.pace.edu
Beka Kosanovic
University of Massachusetts Amherst
413-545-0684
kosanovi@ecs.umass.edu
PACIFIC
www.pacificCHPTAP.org
Terry Clapham
California Center for Sustainable Energy
858-244-4872
terry.clapham@energycenter. org
Jim Freihaut
The Pennsylvania State University
814-863-0083
jdf I I@psu.edu
Gene Kogan
California Center for Sustainable Energy
858-633-8561
Gene.Kogan@energycenter.org
··
•
SOUTHEAST
SOUTHWEST
www.southeastCHPTAP.org
www.southwestCHPTAP.or
Isaac Panzarella
North Carolina State University
919-515-0354
ipanzarella@ncsu.edu
Christine Brinker
Southwest Energy Efficiency Project
720-939-8333
cbrinker@swenergy.org
DOE CHP Technical
Assistance
Partnerships (TAPs):
Program Contacts
Claudia Tighe
CHP Deployment Lead
Office of Energy Efficiency and
Renewable Energy
U.S. Department of Energy
Phone: 202-287-1 899
E-mail: claudia.tighe@ee.doe.gov
Jamey Evans
Project Officer. Golden Field Office
Office of Energy Efficiency and
Renewable Energy
U.S. Department of Energy
Phone: 720-356-1536
E-mail: jamey.evans@go.doe.gov
Patti Welesko Garland
Ted Bronson
CHP Technical Support Coordinato r
DOE CHP TAPs Coordinator
Oak Ridge National Laboratory
Power Equipment Associates
Supporting. Office of Energy Efficiency Supporting. Office of Energy
and Renewable Energy
Efficiency and Renewable Energy
U.S. Department of Energy
Phone: 630-248-8778
Phone: 202-586-3753
E-mail: tlbronsonpea@aol.com
E-mail: garlandpw@ornl.gov
Outline
o CHP: The Concept
o CHP: The Business Case
o CHP Project Profiles
o Next Steps & Incentives
10
Fuel Utilization by U.S. Utility Sector
Source: http://www1.eere.energy.gov/manufacturing/distributedenergy/pdfs/chp_report_12-08.pdf
11
CHP: A Key Part of Our Energy Future
o Form of Distributed
Generation (DG)
o An integrated system
o Located at or near a
building / facility
o Provides at least a portion
of the electrical load and
o Uses thermal energy for:
– Space Heating / Cooling
– Process Heating /
Cooling
– Dehumidification
12
CHP provides
efficient, clean,
reliable, affordable
energy – today and
for the future.
Source:
http://www1.eere.energy.gov/manufacturing/distributedenergy/pdf
s/chp_clean_energy_solution.pdf
CHP Technology Components
Fuel
Prime Mover
Natural Gas
Propane
Biogas
Landfill Gas
Coal
Steam
Waste Products
Others
Reciprocating Engines
Combustion Turbines
Microturbines
Steam Turbines
Fuel Cells
Electricity
On-Site Consumption
Sold to Utility
Thermal
Heat Exchanger
13
Generator
Steam
Hot Water
Space Heating
Process Heating
Space Cooling
Process Cooling
Dehumidification
Emerging Drivers for CHP
o Benefits of CHP recognized by
policymakers
o
President Obama signed an Executive Order to
accelerate investments in industrial EE and CHP on
8/30/12 that sets national goal of 40 GW of new
CHP installation over the next decade
o
State Portfolio Standards (RPS, EEPS,
Tax Incentives, Grants, standby rates, etc.
DOE / EPA CHP Report (8/2012)
o Favorable outlook for natural
gas supply and price in North
America
o Opportunities created by
environmental drivers
o Energy resiliency and critical
infrastructure
14
Executive Order: http://www.whitehouse.gov/the-pressoffice/2012/08/30/executive-order-acceleratinginvestment-industrial-energy-efficiency
Report:
http://www1.eere.energy.gov/manufacturing/distributedene
rgy/pdfs/chp_clean_energy_solution.pdf
CHP Is Used at the Point of Demand
4,200 CHP Sites
(2012)
82,400 MW –
installed capacity
Saves 1.8 quads of
fuel each year
Avoids 241 M metric
tons of CO2 each year
87% of capacity – industrial
71% of capacity – natural
gas fired
Source: ICF International
Favorable Characteristics for
CHP Applications
o Concern about energy costs
o Concern about power
reliability
o Concern about sustainability
and environmental impacts
o Long hours of operation
o Existing thermal loads
o Central heating and cooling
plant
16
o Future central plant
replacement and/or
upgrades
o Future facility expansion or
new construction projects
o EE measures already
implemented
o Access to nearby renewable
fuels
o Facility energy champion
Over 200 hospitals are using CHP
today…
State
# Sites
Capacity (MW)
State
# Sites
Capacity (MW)
AR
AZ
1
2
8.5
1.7
MS
1
4.2
NC
2
5.8
CA
50
170.8
NH
2
9.2
CT
12
28.5
NJ
8
11.1
FL
7
24.9
NV
1
1.0
HI
3
1.5
NY
39
56.1
IA
4
5.5
IL
13
41.4
OH
3
2.2
IN
2
3.5
PA
11
83.9
MA
9
108.8
RI
7
30.1
MD
1
15.0
TN
2
3.5
ME
2
5.1
TX
7
72.4
MI
6
11.6
VA
3
3.2
MN
4
30.1
VT
2
0.5
MO
1
5.0
WI
7
11.7
Source: ICF CHP Installation Database, 2013
17
Existing CHP Installations in
U.S. Hospitals
o 212 facilities generating 756.6 MW
CHP Systems (#)
CHP Gen Capacity (MW)
Boiler / Steam
Turbine
Combined
Cycle
Gas Turbine
Boiler / Steam
Turbine
Combined
Cycle
Gas Turbine
Recip Engine
Recip Engine
Fuel Cell
Microturbine
Fuel Cell
Microturbine
Other Waste
Other
Heat
Waste Heat
18
Source: ICF CHP Installation Database, 2013
Typical Hospital CHP System
Configurations
o Sizes TYPICALLY range from 100s of kWs to several MWs (depending
on facility size and usually below 10 MW)
o Common CHP prime mover types in hospitals are reciprocating
engines, combustion turbines, and/or steam turbines (mostly fueled by
natural gas)
o Most hospital CHP systems are sized for the thermal load requirements
with the resulting electric power generated used to first offset the power
purchased from the utility grid (excess power can be sold to the utility)
o CHP systems do not replace the need for emergency generator sets to
meet the “life critical loads” of a hospital
– Can reduce the number and capacity of the emergency generators
– Can increase the total electric reliability for the hospital
19
Source:
http://www.midwestcleanenergy.org/Archive/pdfs/US
HospitalGuidebook_111907.pdf
Emergency Generators vs.
CHP Systems
Emergency Generators
o Minimum requirement, sized to
meet “life critical loads
o Hospitals are installing larger
generators to protect more and
more hospital loads
o Diesel fueled – high emissions &
limited amount of stored fuel (hours
versus days of operation)
o Not designed or capable of
continuous operation for long
periods of time – rarely operates
o Financial payback only in times of
emergency
20
CHP Systems
o Sized to meet thermal or electric
loads – operates continuously to
meet those loads
o Natural gas fueled – low emissions
o Does not replace emergency
generator set for “life critical” loads
o Reduces overall size and capacity
of emergency generator sets
o Emergency generator sets become
backup to the backup; much higher
reliability
o Good financial return
CHP Benefits to Hospitals
o Reduces energy costs
o Increases energy efficiency, helps manage
costs, maintains jobs, etc.
o Reduces risk of electric grid disruptions &
enhances energy reliability
o Provides stability in the face of uncertain
electricity prices
21
Project Profiles: Example CHP Installations
Example Scenario
CHP Facility
Hospital Utilities Expansion
Northwest Community Hospital
Improved ENERGY STAR Building Score
ProMedica Health System – Wildwood
Improved LEED Scoring – LEED Platinum
Dell Children’s Medical Center of Central Texas
Alternative Financing
Jesse Brown VA Medical Center
Addressing Momentary Power Interruptions
Lake Forest Hospital
Disaster Relief – Hurricane Katrina
Mississippi Baptist Medical Center
Disaster Relief – Super Storm Sandy
Danbury Hospital
Disaster Prevention – Snow Storm
Presbyterian Homes
Energy Independence
Thermal Energy Corporation (TECO)
Energy Independence & Unique Partnerships
Gundersen Lutheran Health System (La Crosse)
Energy Independence & Public / Private Partnerships
Gundersen Lutheran Health System (Onalaska)
Project Profile:
Utilities Expansion
Northwest Community
Hospital
Arlington Heights, IL
Capacity: 4.6 MW
Fuel: Natural Gas
Prime Mover: Recip. Engines
Installed: 1997 / 2005
"We said, ‘Well, if we're going to centralize it all, doesn't it make sense to do a CHP—and generate our
own electricity, to reduce our demand load, and then capture the heat of those engines and utilize all
that for heating and/or cooling?' "
Charlie Stevenson, Director of Plant Operations
Northwest Community Hospital
"The beauty of this CHP to him was not simply the return for the cogen system, but the fact that these
savings would pay for the central energy plant too.”
Joe Sinclair, Ballard Engineering
Project Profile:
Alternative Financing
Jesse Brown VA
Medical Center
Chicago, IL
Capacity: 3.4 MW
Fuel: Natural Gas
Prime Mover: Combustion Turbine
Installed: 2003
Energy Systems Group (ESG) raised $13 million funding for design,
construction, and installation of the project by creating an owner trust,
which then sold bonds used for financing. In turn, the owner trust
contracted with ESG to operate and maintain the CHP system for 25 years.
Source:http://www.distributedenergy.com/DE/Articles/Chicag
o_VA_Hospital_Takes_Control_of_Its_Electrici_1838.aspx
Project Profile:
Increased ENERGY STAR
Building Score
ProMedica Health
System - Wildwood
Toledo, OH
Capacity: 130 kW
Fuel: Natural Gas
Prime Mover: Microturbines
Installed: 2013
Benefits include
a reduction in annual
energy costs and
greenhouse gas
emissions as well as a
higher ENERGY STAR
building score
Source: www.gemenergy.com
Project Profile:
LEED Platinum
Dell Children’s Medical
Center of Central Texas
Austin, TX
Capacity: 4.6 MW
Fuel: Natural Gas
Prime Mover: Combustion Turbines
Installed: 2009
First healthcare facility in the
world to achieve a LEED Platinum
certification by the U.S. Green
Building Council (USGBC)
Project Profile:
Addressing Instantaneous
Power Interruptions
Lake Forest Hospital
Lake Forest, IL
Capacity: 3.2 MW
Fuel: Natural Gas
Prime Mover: Recip. Engines
Installed: 1997
Annual Instantaneous Power
Interruptions were reduced from
50 down to 2 due to CHP
installation
Project Profile:
Disaster Relief, Hurricane
Katrina
Mississippi Baptist
Medical Center
Jackson, MS
Capacity: 4.2 MW
Fuel: Natural Gas
Prime Mover: Combustion Turbines
Installed: 1991
The independence provided by the CHP system allowed MBMC to continue operation
relatively unaffected during Hurricane Katrina in 2005. As soon as power reliability became
a factor MBMC performed a load shed, switched off of the power grid, and continued
operation in turbine-only mode. MBMC was the only hospital in the Jackson metro area to
remain nearly 100% operational. After approximately 50 hours, the power reliability issue
was addressed and MBMC connected to the power grid and returned to normal operation.
Source: http://www.southeastcleanenergy.org/resources/reports/CHP-MBMC.pdf
Project Profile:
Disaster Relief, Super Storm
Sandy
Danbury Hospital
Danbury, Connecticut
Capacity: 4.5 MW / 3 MW Standby
Fuel: Natural Gas / Diesel
Prime Mover: Combustion Turbine /
Recip. Engine Backups
Installed: 2011
During the storm, the facility operated without any loss of
power and, despite most of the businesses in the
surrounding area being without power for several days,
Danbury Hospital still had lights and heat. The CHP facility
enabled the hospital to be fully functional during the storm
and continued conducting business and providing the
critical and necessary health care for patients.
Source:
http://www.newstimes.com/news/article/D
anbury-Hospital-generates-power-for-itspatients-1345938.php#photo-829406
Project Profile:
Addressing Extended Power
Outages
Presbyterian Homes
Evanston, IL
Capacity: 2.4 MW
Fuel: Natural Gas
Prime Mover: Recip. Engines
Installed: 2001
Ice storm in winter of 1998
knocked out power for 9 hours.
• 600 senior residents were
transferred to safety
• CHP installed to avoid future
outages
“The environment we provide to elderly adults
had everything to do with our decision to pursue
power generation. Loss of power isn’t an option.
Lives depend on it.”
- Keith Stohlgren, V/P Operations
“We had no power for nine hours one cold, winter
day during an ice storm. The loss of power forced
us to take immediate, aggressive measures to
ensure the comfort and safety of our residents.”
– Nancy Heald Tolan, Director of Facilities
Management
Project Profile:
100% Energy Independence
Thermal Energy
Corporation (TECO)
Houston, TX
Capacity: 48 MW
Fuel: Natural Gas
Prime Mover: Comb. Turbines
Installed: 2010
TECO operates the largest chilled water district energy system in the U.S. at
the largest medical center in the world, the Texas Medical Center.
The CHP system can operate as a baseload system to serve 100% of the TECO
plant peak electrical load and 100% of TECO customers’ peak process and
space heating loads.
Project Profile:
Energy Independence &
Unique Partnerships
Gundersen Lutheran
& City Brewery
La Crosse, IL
Capacity: 633 kW
Fuel: Biogas
Prime Mover: Recip. Engine
Installed: 2009
Hospital owns CHP
system at local brewery.
Heat from CHP system
used to heat digester,
electricity is sold to utility,
and electric sales/credit
go to hospital.
Project Profile:
Public & Private Partnerships
Gundersen Lutheran
& County Landfill
Onalaska, IL
Capacity: 1.2 MW
Fuel: Landfill Gas
Prime Mover: Recip. Engine
Installed: 2011
Instead of simply generating
electricity at landfill, landfill gas is
piped 2 miles to hospital where CHP
system provides all required
electricity and thermal energy. Claim
to be first energy independent
hospital in U.S.
CHP TAP Project Development
Technical Assistance
Screening and
Preliminary
Analysis
Quick screening
questions with
spreadsheet
payback
calculator.
Advanced Manufacturing Office (AMO)
Investment
Grade Analysis
Feasibility
Analysis
Uses available site
information.
Estimate: savings,
Installation costs,
simple paybacks,
equipment sizing
and type.
34
3rd Party review of
Engineering
Analysis.
Review equipment
sizing and choices.
Procurement,
Operations,
Maintenance,
Commissioning
Review
specifications and
bids,
Limited operational
analysis
manufacturing.energy.gov
DOE TAP CHP Screening Analysis
o High level assessment
to determine if site
shows potential for a
CHP project
– Qualitative Analysis
• Energy Consumption & Costs
Annual Energy Consumption
Base Case
Purchased Electricty, kWh
Generated Electricity, kWh
On-site Thermal, MMBtu
CHP Thermal, MMBtu
Boiler Fuel, MMBtu
CHP Fuel, MMBtu
Total Fuel, MMBtu
Purchased Electricity, $
Standby Power, $
• Estimated Energy Savings &
Simply Payback
Total Operating Costs, $
• CHP System Sizing
Simple Payback
• Understanding site peculiarities
426,000
0
532,500
0
5,534,150
82,716,010
18,872
407,128
23,590
969,845
532,500
993,435
$7,060,013
$1,104,460
$0
$3,195,000
CHP Fuel, $
$0
$0
Annual Operating Savings, $
Total Installed Costs, $/kW
Total Installed Costs, $/k
$10,255,013
$0
$141,539
$5,819,071
$744,444
$7,809,514
$2,445,499
$1,400
$12,990,000
5.3
Operating Costs to Generate
Fuel Costs, $/kWh
Thermal Credit, $/kWh
35
0
Incremental O&M, $
Simple Payback, Years
• Understanding project drivers
88,250,160
Annual Operating Costs
On-site Thermal Fuel, $
– Quantitative Analysis
CHP Case
$0.070
($0.037)
Incremental O&M, $/kWh
$0.009
Total Operating Costs to Generate, $/kWh
$0.042
Incentives and Financing
o 10% Federal Investment Tax Credit (ITC) for CHP
o DOE Better Buildings Challenge, Financial Allies have
committed nearly $2B to fund EE projects*
o Waste Heat Recovery (WHR) is eligible in
MidAmerican Energy Efficiency Resource Standard
(EERS)
o 3rd Party Build-Own-Operators of CHP Opportunities?
–
How does the July 2014 Iowa Supreme Court Ruling on solar projects impact CHP 3rd Party Ownership?
* http://www4.eere.energy.gov/challenge/allies/financial-allies
36
Why CHP in Hospitals?
o Healthcare organizations spend > $6.5B annually
o Every $1 a non-profit healthcare organization saves on energy is
equivalent to generating $20 in new revenues for hospitals
o For-profit hospitals can raise their earnings per share 1¢ by reducing
energy costs just 5%
o CHP systems can reduce energy costs and carbon emissions
o CHP systems can maintain hospitals’ power and heat during manmade and natural disasters
o 200+ hospitals operate CHP systems today
o 7 of Top 16 U.S. hospitals use CHP according to US News
1)ENERGY STAR - http://www.energystar.gov/ia/business/challenge/learn_more/Healthcare.pdf
2) DOE CHP Installation Database
3)US News’ 2013-2014 Honor Roll of the Nation’s Top 18 Hospitals:(John Hopkins, Mass. General, Mayo Clinic, Cleveland Clinic, NY
Presbyterian, NYU Langone, Indiana University)
37
Questions
Cliff Haefke
(312) 355-3476
chaefk1@uic.edu
A program sponsored by
www.MidwestCHPTAP.org
Other Resources
o Powering the Future of Health Care – Financial and
Operational Resilience: A CHP Guide for
Massachusetts Hospital Decision Makers (HCWH)
o Advanced Energy Design Guide for Large Hospitals
(ASHRAE)
o Advanced Energy Design Guide for Small Hospitals
and Healthcare Facilities (ASHRAE)
o Combined Heat & Power (CHP) Resource Guide for
Hospital Applications (Midwest CEAC)
o Guide to Using Combined Heat and Power for
Enhancing Reliability and Resiliency in Buildings
(DOE/EPA)
1 - http://www.greenribboncommission.org/downloads/CHP_Guide_091013.pdf
2 - https://www.ashrae.org/standards-research--technology/advanced-energy-design-guides
3 - https://www.ashrae.org/standards-research--technology/advanced-energy-design-guides
4 - http://www.midwestchptap.org/Archive/pdfs/USHospitalGuidebook_111907.pdf
39
5 - http://www1.eere.energy.gov/manufacturing/distributedenergy/pdfs/chp_for_reliability_guidance.pdf