Combined Heat and Power: Pathway to Lower Energy Costs, Reduced Emissions, Secure and Resilient Energy Supply

Combined heat and power (CHP) systems in the U.S. offer significantly higher energy efficiency (70% or more) than separate heat and power production. With over 82 GW of installed capacity, CHP is widely used in industrial sectors, particularly chemicals, petroleum refining, and pulp and paper. The document highlights CHP's ability to provide resilient power during extreme weather events, such as Hurricane Sandy, and its potential to reduce CO2 emissions. While there is an untapped potential of 130 GW, deployment is hindered by regulatory and legal barriers. The text also emphasizes the climate benefits of biomass-fueled CHP, which can be net carbon negative and provide reliable baseload power.

• CHP systems are significantly more efficient than producing heat and power separately, achieving efficiencies of 70 percent or more, whereas separate production averages less than 45 percent.
• The United States has over 4,100 CHP systems with more than 82 GW of installed capacity, accounting for approximately eight percent of total U.S. electric power generation capacity. The chemical industry holds the largest share of this capacity at 29 percent, followed by petroleum refining (18 percent) and pulp and paper (14 percent).
• Installing an additional 40 GW of CHP capacity could save U.S. businesses and industry $10 billion annually in energy costs, reduce national energy demand by one percent, and further lower CO2 emissions by 150 million tons per year.
• CHP systems provide critical energy resilience during extreme weather; they were essential for maintaining heat and power in New Jersey, New York, and Connecticut after Hurricane Sandy, and proved more reliable than emergency electrical back-up generators during Hurricanes Katrina and Rita in Louisiana.
• There is an untapped CHP potential of approximately 130 GW at U.S. industrial, institutional, and commercial facilities. CHP could theoretically replace over 100 percent of anticipated coal-fired power plant retirements across twelve states by 2020, provided critical policies are implemented.
• Deployment of CHP is hindered by regulatory and legal barriers, including unfavorable utility interconnection standards, backup power rates, and a lack of output-based emission standards in states facing high levels of coal retirements.
• Biomass-fueled CHP can be net carbon negative on a life cycle basis by avoiding methane emissions from decomposing residues. Unlike intermittent wind (36% availability) or solar (22% availability), biomass CHP provides reliable 24/7 baseload power.

APA

Environmental and Energy Study Institute (2013). Combined Heat and Power: Pathway to Lower Energy Costs, Reduced Emissions, Secure and Resilient Energy Supply. https://www.eesi.org/files/FactSheet_CHP_052113.pdf

Chicago

Environmental and Energy Study Institute. Combined Heat and Power: Pathway to Lower Energy Costs, Reduced Emissions, Secure and Resilient Energy Supply. 2013. https://www.eesi.org/files/FactSheet_CHP_052113.pdf.

Wikipedia

{{cite report |author=Environmental and Energy Study Institute |title=Combined Heat and Power: Pathway to Lower Energy Costs, Reduced Emissions, Secure and Resilient Energy Supply |date=May 2013 |url=https://www.eesi.org/files/FactSheet_CHP_052113.pdf |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{environmentalandenergystudyinstitute2013combined, author = {{Environmental and Energy Study Institute}}, title = {{Combined Heat and Power: Pathway to Lower Energy Costs, Reduced Emissions, Secure and Resilient Energy Supply}}, institution = {Environmental and Energy Study Institute}, year = {2013}, month = may, url = {https://www.eesi.org/files/FactSheet_CHP_052113.pdf}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }