Combined Heat and Power (CHP) Incentives
The New York State Energy Research and Development Authority (NYSERDA) offers incentives to promote the installation of clean, efficient, and commercially available CHP Systems that provide summer on-peak demand reduction. Incentives are performance-based and correspond to the summer-peak demand reduction (kW), energy generation (kWh), and fuel conversion efficiency (FCE) achieved by the CHP system on an annual basis over a two-year measurement and verification (M&V) period. Multifamily buildings are ineligible.
Incentive
| |
Upstate |
Con Edison |
| Combined Heat and Power |
$0.10/kWh + $600/kW* |
$0.10/kWh + $750/kW* |
*kW is summer peak demand reduction, not installed capacity
Incentives are capped at $2,000,000 per CHP project.
Eligibility
A CHP System must:
- Consist of commercially available reciprocating engine or gas turbine-based CHP systems that result in electrical peak demand reduction during the summer capability period
- Have a 60% annual fuel conversion efficiency based on a higher heating value (HHV) including parasitic losses
- Use at least 75% of the generated electricity on-site
- Have a NOx emission rate < 1.6 lbs./MWhr
Note: Pending DEC regulations, when passed, will establish a new NOx emission rate that, if stricter, will supersede the 1.6 lbs/MWhr.
Fuel cells, microturbines, direct drive natural gas engines providing mechanical energy only, and CHP systems currently contracted for installation under another NYSERDA program, or projects eligible to submit to the customer sited tier of the Renewable Portfolio Standard are ineligible.
Nonperformance Incentive Reductions
CHP systems are subject to performance penalties for not achieving minimum fuel conversion efficiency, air emissions requirements, or at least 60% of the agreed upon summer-peak demand reduction. See CHP Systems Manual for details.
Measurement and Verification
CHP systems will undergo M&V for a period of two years. NYSERDA, or its consultant will create an M&V Plan in collaboration with the applicant. The purpose of M&V is to quantify:
- Generator power output (kW) at 15-minute intervals during key on-peak periods
- Cumulative energy generated and used on-site by the CHP System (kWh) on an annual basis
- Annual fuel conversion efficiency
- NOx emissions testing at the end of each year of M&V
Incentives will be paid based on review and approval of the M&V data by NYSERDA or its consultant. Incentive payments will be made in 3 phases: 40% after installation and commissioning, and 30% after each year of M&V.
Minimum Size
Projects must have a total installed capacity based on manufacturer nameplate of > 250 kW or must be adding > 250 kW to an existing CHP System.
All M&V data shall be transmitted to NYSERDA’s CHP Website. |
