Energy System and Thermoeconomic Analysis of Combined Heat and Power Fuel Cell Systems

The United States (U.S.) Department of Energy (DOE)’s Pacific Northwest National Laboratory (PNNL) is spearheading a program with industry to deploy and independently monitor five kilowatt-electric (kWe) combined heat and power (CHP) fuel cell systems (FCSs) in light commercial buildings. This publication discusses results from PNNL’s research efforts to independently evaluate manufacturer-stated engineering, economic, and environmental performance of these CHP FCSs at installation sites. The analysis was done by developing parameters for economic comparison of CHP installations. Key thermodynamic terms are first defined, followed by an economic analysis using both a standard accounting approach and a management accounting approach. Key economic and environmental performance parameters are evaluated, including (1) the average per unit cost of the CHP FCSs per unit of power, (2) the average per unit cost of the CHP FCSs per unit of energy, (3) the change in greenhouse gas (GHG) and air pollution emissions with a switch from conventional power plants and furnaces to CHP FCSs; (4) the change in GHG mitigation costs from the switch; and (5) the change in human health costs related to air pollution. CHP FCS heat utilization is expected to be less than 100% at several installation sites. Specifically at six of the installation sites, during periods of minimum building heat demand (i.e. summer season), the average in-use CHP FCS heat recovery efficiency based on the higher heating value of natural gas is expected to be only 24.4%. From the power perspective, the average per unit cost of electrical power is estimated to span a range from $15–19,000/kilowatt-electric (kWe) (depending on site-specific changes in installation, fuel, and other costs), while the average per unit cost of electrical and heat recovery power varies between $7,000 and $9,000/kW. From the energy perspective, the average per unit cost of electrical energy ranges from $0.38 to $0.46/kilowatt-hour-electric (kWhe), while the average per unit cost per unit of electrical and heat recovery energy varies from $0.18 to $0.23/kWh. These values are calculated from engineering and economic performance data provided by the manufacturer (not independently measured data). The GHG emissions were estimated to decrease by one-third by shifting from a conventional energy system to a CHP FCS system. The GHG mitigation costs were also proportional to the changes in the GHG gas emissions. Human health costs were estimated to decrease significantly with a switch from a conventional system to a CHP FCS system. A unique contribution of this paper, reported for the first time here, is the derivation of the per unit cost of power and energy for a CHP device from both standard and management accounting perspectives. These expressions are shown in Eq. (21) and Eq. (31) for power, and in Eq. (24) and Eq. (34) for energy. This derivation shows that the average per unit cost of power is equal to the average per unit cost of electric power applying a management accounting approach to this latter calculation. This term is also equal to the average per unit cost of heat recovery power applying a management accounting approach. A similar set of relations hold for the average per unit cost of energy. These derivations underscore the value of using Eq. (21) for economic analyses to represent the average per unit cost of electrical power, heat recovery power, or both, and using and Eq. (24) for energy.