Mike Hyland, senior vice president of engineering services at the American Public Power Association, which represents community-owned electric utilities, says there are legitimate reasons for the costs.
“You usually have to put in breakers and relays when you do interconnections (with combined heat and power generators), and they come with a cost,” he says.
Utilities also have to study the systemwide impact of organizations that switch to cogeneration systems.
“So you get multiple customers on your line asking for various changes. You're going to have to spend some time on a review. Who pays for that analysis?” Hyland says. “I can't tell you how many times we've had somebody see the results (of a study) ... and say, 'we're not going to do it.' ”
Still, hospitals are finding that the energy and cost savings can trump the standby fees and other utility charges, and the number of hospitals jumping on the bandwagon is increasing, says McNeil at the EPA.
He says that during the past decade, seven to 10 hospitals have installed such systems each year. Since 2003, 194 MW of energy capacity from cogeneration has been added by hospitals, nearly double the 101 MW hospitals added during the preceding 10 years, McNeil says.
The EPA has been actively encouraging the use of cogeneration at hospitals and other commercial enterprises through educational outreach, spreading the word about grants and rebates for installing the systems, presenting public recognition awards to hospitals that achieve high energy efficiency, and offering tools on its website to help facility managers determine whether such conversions are right for them.
But the EPA's hands are tied when it comes to altering utility policy. “We can't do too much about (this barrier), and this is maybe the most important one,” McNeil says.
Utilities are regulated at the state level, and the amount of ease for utility customers looking to pursue combined heat and power varies greatly.
Ohio, for instance, is trying to lighten the burden of standby fees for customers that choose cogeneration, says Butler at the PUCO. The New York State Energy Research & Development Authority offers financial incentives for facilities to install the systems.
Elliott is optimistic that the regulatory obstacles to combined heat and power will diminish in the coming years. He contends that state governments and utilities already appear to be warming to the broader advantages of combined heat and power generation. “They are picking up on this idea that this is a good thing,” he says.
Still, Garforth says that while cogeneration makes a lot of sense for medical facilities, it's not a good fit for every hospital.
It's unwise, he says, to consider adding expensive new supply equipment if the facility is wasting those gains in energy efficiency by inefficiently using the power—say, through drafty windows or poor scheduling of energy-intensive operating rooms. Garforth says U.S. hospitals can generally find between 30% and 50% reductions in energy use through basic efficiency measures, such as swapping out windows, upgrading lighting, insulating the roof and changing operating practices to optimize energy use.
“If you don't understand how to manage energy, wherever it's coming from ... it's the wrong time to be making those decisions (to install cogeneration). First, get your system under control and get your staff trained,” Garforth says.
Kerry Grens is a freelance writer based in the western suburbs of Chicago. Reach her at [email protected]