Challenges Facing Combined Heat and Power Today: A State-by-State Assessment Anna Chittum and Nate Kaufman September 2011 Report Number IE111 © American Council for an Energy-Efficient Economy 529 14th Street, N.W., Suite 600, Washington, D.C. 20045 (202) 507-4000 phone, (202) 429-2248 fax, www.aceee.org Challenges Facing Combined Heat and Power Today, © ACEEE CONTENTS Executive Summary ...................................................................................................................................... iii Acknowledgments ......................................................................................................................................... v Glossary ........................................................................................................................................................ vi Introduction.................................................................................................................................................... 1 Combined Heat and Power Today ........................................................................................................... 1 Methodology ............................................................................................................................................. 5 Part I: General Findings ................................................................................................................................ 6 Economics ................................................................................................................................................ 6 Financing ................................................................................................................................................ 10 Regional and Sectoral Differences ......................................................................................................... 11 Incentives ................................................................................................................................................ 13 Other Barriers ......................................................................................................................................... 17 General Findings, Thoughts and Conclusions ........................................................................................ 22 Part II: State Profiles ................................................................................................................................... 23 An Explanatory Note about Terms Used in this Section ........................................................................ 23 Alabama ...................................................................................................................................................... 25 Alaska ........................................................................................................................................................ 26 Arizona ........................................................................................................................................................ 27 Arkansas ..................................................................................................................................................... 28 California ..................................................................................................................................................... 29 Connecticut ................................................................................................................................................. 31 Delaware ..................................................................................................................................................... 32 District of Columbia ..................................................................................................................................... 33 Florida ........................................................................................................................................................ 34 Georgia ........................................................................................................................................................ 35 Hawaii ........................................................................................................................................................ 36 Idaho ........................................................................................................................................................ 37 Illinois ........................................................................................................................................................ 38 Indiana ........................................................................................................................................................ 39 Iowa ........................................................................................................................................................ 40 Kansas ........................................................................................................................................................ 41 Kentucky...................................................................................................................................................... 42 Louisiana ..................................................................................................................................................... 43 Maine ........................................................................................................................................................ 44 Maryland...................................................................................................................................................... 45 Massachusetts ............................................................................................................................................ 46 Michigan ...................................................................................................................................................... 47 Minnesota .................................................................................................................................................... 48 Mississippi ................................................................................................................................................... 49 Missouri ....................................................................................................................................................... 50 Montana ...................................................................................................................................................... 51 Nebraska ..................................................................................................................................................... 52 Nevada ........................................................................................................................................................ 53 New Hampshire ........................................................................................................................................... 54 New Jersey.................................................................................................................................................. 55 New Mexico ................................................................................................................................................. 56 New York ..................................................................................................................................................... 57 North Carolina ............................................................................................................................................. 58 North Dakota ............................................................................................................................................... 59 Ohio ........................................................................................................................................................ 60 Oklahoma .................................................................................................................................................... 61 Oregon ........................................................................................................................................................ 62 i Challenges Facing Combined Heat and Power Today, © ACEEE Pennsylvania ............................................................................................................................................... 63 Rhode Island ............................................................................................................................................... 64 South Carolina ............................................................................................................................................ 65 South Dakota .............................................................................................................................................. 66 Tennessee................................................................................................................................................... 67 Texas .......................................................................................................................................................