## New Jersey launches Large Scale CHP/Fuel Cell Program

##### 29 April 2012

The New Jersey Economic Development Authority (EDA) and the New Jersey Board of Public Utilities (BPU) launched the Large Scale Combined Heat and Power (CHP)/Fuel Cell Program. This competitive grant program was created to support CHP and standalone fuel cell projects serving commercial, institutional and industrial customers in New Jersey.

The amount available for grant funding under the initial solicitation is $20 million. It is anticipated that another solicitation will be made available in late 2012 in the approximate amount of$35 million. Program awards cannot exceed \$3 million per project with maximum percent of project cost capped at 30% for CHP and 45% for Fuel Cell Projects.

The program is available to support CHP or standalone fuel cell projects with an electric generating capacity of greater than one megawatt (MW). New Jersey-based government (federal, state or local), commercial, institutional or industrial entities advancing these projects are eligible. Applications for the program must be submitted prior to the closing of the competitive solicitation, which runs from 25 April 2012 through 25 June 2012.

To be eligible, CHP systems greater than one MW with waste heat utilization must achieve annual system efficiency of at least 65%; fuel cell projects greater than one MW without heat recovery must achieve annual system efficiency of at least 45%. CHP and fuel cell system warranties must be all-inclusive for at least five years. Additionally, businesses should create or maintain jobs in New Jersey.

Grants under the program will be awarded under a tiered incentive structure based on the system size and amount of electricity that the CHP or fuel cell project generates.

Total state and/or federal funding cannot exceed 50% of the total project cost. Funding can be used for project-specific, fixed asset purchases. New installations are eligible, as are expansions of existing facilities with new equipment. New equipment must be commercially available and permanently installed. Applicants must provide evidence that a source of funds is needed to complete the project.

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While the total dollar amount here is relatively small - it does confirm the attention being paid to support for district CHP and fuel cell systems. This mirrors the DOE change of heart re CHP on large scale - especially for "district" heating and power.

All in all this is exactly the type of acceptance needed to help grow the CHP concept for <50MW industrial and district applications.

Replacement of centralized grid energy with distributed CHP lowers demand for new power plants, increases efficiency, converts waste heat to hot water, area heating and cooling - and lowers transmission costs.

Interesting that State funds could support federal New Jersey-based projects. New Jersey EDA and BPU set a valuable model for other States to adopt CHP as a cost effective alternative to central grid energy. They are to be congratulated for their vision.

I am happy to read that the State is supporting this sort of small- medium scale power initiative. I had feared that under the current NJ Administration all tech/science spending would be curtailed.

CHP in the near term offers the biggest efficiency bang for the technology buck. Nice to see these sorts of things funded.

A natural-gas powered engine without any heat recovery can surpass the fuel cell stand alone efficiency requirement at much lower cost, and an array of engines can also be used for grid support because of their fast starting ability and high low load efficiency.

CHP is the fastest cheapest way to reduce the production of CO2.

..HG..

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