Combined heat and power (CHP) systems were responsible for just under 10% of global electrical power generation capacity in 2011. CHP is a set of power generation technologies that provides both heat in the form of steam or hot water and electricity from a single system. These systems include a prime mover to convert fuel into electricity, a heat recovery steam generator (HRSG) to generate the process heat and perhaps a boiler if the system burns coal or wood waste to run a steam turbine.



The CHP market has been driven by China in the last five years, as that country’s fast paced electrical generation capacity increases have significantly bolstered the CHP market in the country. However, China’s power capacity growth is slowing, resulting in an essentially flat global CHP market between 2007 and 2011, posting a compound annual growth rate (CAGR) of just 0.4% for the period to reach a value of $19.3 billion. The CHP market has been much stronger in the U.S. and Germany, with both countries achieving near 20% CAGR between 2007 and 2011. The small-CHP market has experienced an incredible CAGR of 24.8% in the same period on the strength of micro-CHP (under 5 kW) sales in Japan and small-CHP (up to 1 MW) sales in Germany.



Spark spread and government incentives are the two main driving forces behind the CHP market, although each has a different effect for different market segments. The U.S. market has been up and down over the period, and has been lower than what was experienced in the first part of the decade, because of the lack of strong government support and dropping natural gas prices. Germany, on the other hand, has a strong feed in tariff policy that is continuing to drive the CHP market in the country and will continue to do so in the long term. In Japan, exceptionally large subsidies for micro-CHP systems continue to accelerate that segment of the CHP market in the country.



Natural gas turbines continue to provide most CHP electricity generation in the U.S. and Europe, but it is reciprocating engine-based CHP systems that are the most numerous. The most common type of fuel in use for CHP systems in most countries is natural gas. The major exception is China where coal is still the dominant fuel being used in many of the country’s district heating systems. Countries such as Sweden, Switzerland, Norway and Finland have over 30% of CHP electricity generation from renewable fuels such as wood waste and municipal waste.



The CHP market will continue to experience slow growth over the next five years. However, SBI Energy expects global electricity costs to rise faster than the cost of natural gas in the long term, leading to a much stronger CHP market through the end of the decade. By 2021, there will be 651 gigawatts (GW) of CHP capacity installed worldwide, and the global CHP market will be worth $43.1 billion. The small-CHP segment will continue to grow faster than the overall CHP market, achieving a CAGR of 12.2% between 2012 and 2021 and growing to be worth a little over 6% of the global CHP market.

Table Of Contents

Chapter 1: Executive Summary

Scope

The CHP Market

Table 1-1: The Global CHP Market by Country, 2007-2011 (in million $)

China

Figure 1-1: New China CHP Capacity by Year, 2007-2011 (in MW and percentage of new power capacity)

The German CHP Market

United States

The Small- and Micro-CHP Segment

Table 1-2: The Global Small-CHP Market by Country, 2007-2011 (in million $)

CHP Market Forecast

Figure 1-2: Global CHP Market Forecast, 2007-2011 (in billion $ and percentage of new power capacity)

Table 1-3: New CHP Capacity Forecast by Country, 2012-2021 (in MW)

Table 1-4: New Small-CHP Capacity Forecast by CHP Type, 2012-2021 (in MW)

Trends in Combined Heat and Power

Figure 1-3: Top CHP Countries by Percentage of Total Capacity that is CHP, 2010 (in GW of total power generation capacity and and percent CHP capacity)

CHP Heat Production and Consumption

Table 1-5: CHP Heat Production by Country, 2006-2010 (in trillion Btu)

Small CHP Use

Drivers and Barriers for CHP

Regulations, Incentives and FITs

Low Spark Spreads Affecting CHP Adoption

Figure 1-4: Spark Spreads for the U.S., Germany and the EU, 2000-2011 (in c/kWh)

CHP Manufacturing Costs

Table 1-6: Average Metal Prices, 2002-2011 (price in $/lb)

Employment Trends in CHP

Table 1-7: CHP Jobs by Country, 2007-2021 (in number of jobs)

District Heating and Cooling (DHC) Trends

Trends in CHP for Industrial Applications

Table 1-8: CHP Use in the Pulp and Paper Industry for Key Countries (in MW)

CHP and Renewables

CHP Demographics

CHP Demographics in China

European CHP Demographics

CHP Demographics in the U.S.

Figure 1-5 :CHP Electricity Production in the U.S. by Fuel, 2007, 2011 (in percent)

CHP Demographics in Japan

Chapter 2: Introduction

Scope

Methodology

Definitions

Introduction to CHP

Figure 2-1: Block Diagram of a CHP Plant

Advantages and Disadvantages of CHP Systems

Figure 2-2: Typical Energy Input and Losses for Conventional Heat and Power Generation and CHP (in generic units of energy)

Table 2-1: Advantages and Disadvantages of CHP Systems

Typical CHP Prime Movers

Table 2-2: Advantages and Disadvantages of Different CHP Prime Movers

Gas Turbines

Figure 2-3: A typical Gas Turbine CHP System

Steam Turbines

Figure 2-4: A typical Steam Turbine CHP System

Microturbines

Figure 2-5: Schematic of a Microturbine

Reciprocating Engines

Other Prime Movers

Fuels Used in CHP

Heat Exchange Systems

Heat Recovery System Generators

Absorption Chillers

Primary CHP Applications

Industrial Applications

Commercial Applications

District Heating

Chapter 3: The World CHP Market

Figure 3-1: World CHP Capacity, 2007-2011 (in GW)

Figure 3-2: The Global CHP Market, 2007-2011 (in billion $)

The CHP Market by Region

Table 3-1: The Global CHP Market by Country, 2007-2011 (in million $)

Figure 3-3: Regional Breakdown of the World CHP Market, 2007, 2011 (in percent)

Germany

Figure 3-4: New German CHP Capacity by Year, 2007-2011 (in MW and percentage of new power capacity)

United States

Figure 3-5: New U.S. CHP Capacity by Year, 2007-2011 (in MW and percentage of new power capacity)

China

Figure 3-6: New China CHP Capacity by Year, 2007-2011 (in MW and percentage of new power capacity)

Other Key Countries

Figure 3-7: Cumulative CHP Capacity of Other Major CHP Countries, 2011 (in MW)

Figure 3-8: The CHP Market of Russia, South Korea and the UK, 2007-2011 (in million $)

The Small- and Micro-CHP Segment

Figure 3-9: The Global Small-CHP Market, 2007-2011 (in million $)

Figure 3-10: New Small-CHP Capacity by Country, 2007-2011 (in MW)

CHP Market Forecast

Figure 3-11: Global CHP Capacity Forecast by Country, 2012-2021 (in GW).

Figure 3-12: Global CHP Market Forecast, 2007-2011 (in billion $ and percentage of new power capacity)

Market Forecast for Key CHP Countries

Figure 3-13: World CHP Market Forecast by Country, 2007-2011 (in percent)

Table 3-2: New CHP Capacity Forecast by Country, 2012-2021 (in MW)

Germany Forecast

Figure 3-14: German CHP Market Forecast, 2012-2021 (in million $)

U.S. CHP Market Forecast

Table 3-3: U.S. Planned CHP Capacity Additions, 2012-2016 (in MW)

Figure 3-15: Planned CHP Capacity Additions in the U.S. by Prime Mover, 2012-2016 (in percent)

China Forecast

Figure 3-16: CHP Installation Forecast for China, 2012-2021 (in MW and percentage of new power capacity)

Small- and Micro-CHP Segment Forecast

Figure 3-17: Global Small-CHP Market Forecast, 2012-2021 (in million $)

Table 3-4: New Small-CHP Capacity Forecast by CHP Type, 2012-2021 (in MW)

Chapter 4: Trends

World Energy Production and Consumption

Figure 4-1: World Primary Energy Consumption, 2000-2010 (in quadrillion Btu)

Electricity Consumption and Production

Figure 4-2: Total Global Electricity Generation, 2006-2010 (in TWh)

Figure 4-3: Top 10 Countries for Electricity Generation, 2010 (in percent)

CHP Heat Production and Consumption

Figure 4-4: CHP Heat Production by Country, 2009 (in trillion Btu)

Table 4-1: CHP Heat Production by Country, 2006-2010 (in trillion Btu)

Use of CHP Around the World

Figure 4-5: Top CHP Countries by Percentage of Total Capacity that is CHP, 2010 (in GW of total power generation capacity and and percent CHP capacity)

Germany

Figure 4-6: German CHP Electricity Production, 2006-2010 (in TWh and percentage of total power generation)

United States

Figure 4-7: U.S. CHP Electricity Production, 2006-2010 (in TWh and percentage of total power generation)

China

Rest of Europe

Table 4-2: CHP Electricity Generation by Country, 2005-2009 (in GWh)

Small CHP Use

Japan

Figure 4-8: Installed Small-CHP Base, 2007-2011 (in thousands of systems installed)

Germany

UK

Table 4-3: UK small-CHP installations, 2006-2010 (in number and MW)

Drivers and Barriers for CHP

Figure 4-9: CHP Market Factors

Low Spark Spreads Affecting CHP Adoption

Figure 4-10: Spark Spreads for the U.S., Germany and the EU, 2000-2011 (in c/kWh)

Table 4-4: Electricity Prices, Gas Prices and Spark Spreads for Key CHP Countries, 2000-2011 (in c/kWh)

Regulations, Incentives and FITs

Table 4-5: CHP Regulations for Key CHP Market Countries, 2012

CHP Manufacturing Costs

Table 4-6: Breakdown of Power Plant Construction Costs, 2010 (in percent)

Figure 4-11: Producer Price Index for Generator Sets, Turbines and Motors, 2004-2011 (index)

Figure 4-12: Metal Prices, 2000-2011 (index, January 2000=100)

Employment Trends in CHP

Table 4-7: CHP Jobs by Employment Sector, 2007-2021 (in number of jobs)

Table 4-8: CHP Jobs by Country, 2007-2021 (in number of jobs)

District Heating and Cooling Trends

Figure 4-13: District Heating by Country, 2009 (in trillion Btu)

DHC in Europe: Russia and Germany Lead

DHC in China

DHC in the U.S.

Table 4-9: U.S. CHP District Heat Capacities by State, 2010 (in MW)

DHC in South Korea

Table 4-10: KDHC Heat Supply by End User, 2006-2011 (in Trillion Btu)

Trends in CHP for Industrial Applications

Figure 4-14: New CHP Capacity Added in the U.S. by Industry, 2006-2010 (in percent)

Pulp and Paper Industry

Table 4-11: CHP Use in the Pulp and Paper Industry for Key Countries (in MW)

Chemical Industry

CHP in the Brazilian and Indian Sugar Industries is Growing

CHP and Renewables

Table 4-12: Use of Renewable Fuels with CHP by Country, 2009 (in percent)

Biofuels and Wood

Table 4-13: Countries with CHP Electricity Production over 1 GWh from Wood waste, 2009 (in GWh)

Municipal and Industrial Waste

Table 4-14: Countries with CHP Electricity Production over 1 GWh from Municipal and Industrial Waste, 2009 (in GWh)

Carbon Abatement with CHP

Figure 4-15: Global CO2 Emissions and Amount of CO2 Reduced by CHP Use, 2006-2010 (in Gt of CO2)

Research Trends

Chapter 5: Demographics

CHP in China

Fuel Use

Figure 5-1: China Energy Production by Fuel, 2009 (in percent)

CHP Use in Europe

Figure 5-2: CHP Electricity Production in the EU by Type of Producer, 2009 (in percent)

Fuel Use in the EU

Figure 5-3: CHP Plant Electricity Production in the EU by Fuel, 2009 (in percent)

Use of Thermal Energy in the EU

Table 5-1v Top EU Countries for CHP Thermal Energy Use, 2004-2008 (in Billion Btu)

CHP in Key European Countries: Germany and the Netherlands

Figure 5-4: German and Dutch CHP Electricity Production by Fuel, 2009 (in percent)

Figure 5-5: CHP Electricity Production in the Netherlands by Prime Mover, 2010 (in percent)

User Demographics

Figure 5-6: German and Dutch CHP Electricity Production by Type of Producer, 2009 (in percent)

CHP Use in the U.S.

Figure 5-7: CHP Electricity Production in the U.S. by Prime Mover, 2007, 2011 (in percent)

Fuel Use

Figure 5-8: CHP Electricity Production in the U.S. by Fuel, 2007, 2011 (in percent)

User Demographics

Figure 5-9: CHP Electricity Production in the U.S. by Type of Producer, 2007, 2011 (in percent)

Table 5-2: U.S. CHP Capacity by Sector, 2010* (in MW)

Heat Use

Figure 5-10: Total Useful Heat Produced by CHP in the U.S., 2004-2010 (in trillion Btu)

Figure 5-11: CHP Heat Production in the U.S. by Fuel, 2007, 2010 (in percent)

CHP in Japan

Figure 5-12: CHP Capacity in Japan by Fuel Use and Prime Mover, March 2011 (in percent)

User Demographics

Table 5-3: Japanese CHP Capacity by End User, March 2011 (in MW installed and number of units)

Chapter 6: Competitors

Component Manufacturers

Gas Turbine and Microturbine Manufacturers

Figure 6-1: Power Plant Gas Turbine Market Share by Manufacturer, 2010 (in percent)

Table 6-1: Select Gas Turbine and Microturbine Manufacturers, 2012

GE Energy

Figure 6-2: GE’s Total Revenue and Energy Business Unit Revenue, 2007-2011 (in billion $)

Siemens

Figure 6-3: Siemens Total Revenue and Fossil Power Generation Revenue, 2007-2011 (in billion euros)

Capstone Turbine Corporation

Figure 6-4: Capstone’s Revenue and Net Income, FY2007-FY2011 (in million $)

Steam Turbine Manufacturers

Table 6-2: Select Steam Turbine Manufacturers, 2012

Alstom

Figure 6-5: Alstom Total Revenue and Revenues for its Thermal Power and Renewables Segments, FY2007/08-FY2011/12 (in billion euros)

Reciprocating Engine Manufacturers

Table 6-3: Select Reciprocating Engine Manufacturers, 2012

Caterpillar

Figure 6-6: Caterpillar’s Total Revenue and Electric Power Segment Revenue, 2007-2011* (in billion $)

Boiler/Waste Heat Boiler Manufacturers

Table 6-4: Select Boiler/Waste Heat Boiler Manufacturers, 2012

Mitsubishi Heavy Industries

Figure 6-7: MHI’s Total Revenue and Power Systems Segment Revenue, FY2006-FY2011* (in billion yen)

Heat Recovery Steam Generator (HRSG) Manufacturers

Table 6-5: Select HRSG Manufacturers, 2012

Nooter/Eriksen

CHP Package Manufacturers and Integrators

Table 6-6: Select Small-CHP Manufacturers, 2012

Table 6-7: Select Mid-sized CHP Manufacturers, 2012

2G Energy

Overview

Performance

Figure 6-8: 2G’s Revenue and Net Income, 2007-2011* (in million euros)

Products

Table 6-8: 2G’s CHP Product Line, 2012

New Developments

Dresser-Rand

Overview

Performance

Figure 6-9: Dresser-Rand Revenue, 2007-2011* (in million $)

Products

Table 6-9: Dresser-Rand’s CHP Product Line, 2012

New Developments

ENER-G

Overview

Performance

Figure 6-10: ENER-G’s Revenue and Net Income, FY2007-FY2011 (in million pounds)

Products

Table 6-10 ENER-G’s CHP Product Line, 2012

New Developments

Tognum (MTU Onsite Energy)

Overview

Performance

Figure 6-11: Tognum’s Total Revenue and Onsite Energy Segment Revenue, 2007-2011 (in million euros)

Products

Table 6-11: MTU Onsite Energy’s CHP Product Line, 2012

New Developments

Micro-CHP Manufacturers

Table 6-12: Select Micro-CHP Manufacturers by Prime Mover Technology, 2012

Honda

Figure 6-12: Honda’s Cumulative ECOWILL Sales, FY2003-FY2010 (in units)

Panasonic (Ene-Farm)

BDR Thermea

Table 6-13: BDR Thermea’s Product Line, 2012

Appendix: Company Contact Information

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