A Guide to Combined Heat and Power (Micro CHP)

Micro CHP: The Basics

Micro CHP systems are combined heat and power systems small enough to be fitted into the average home.

They are fitted in place of your boiler and use either mains gas or LPG (Liquid Petroleum Gas) to heat water for use in a water filled central heating system and to provide hot water.

Whereas industrial CHP systems generate electricity and heat as a by-product of that generation, micro CHP systems operate the opposite way by generating heat and generating electricity as a by-product of that heat generation. Whilst they are generating hot water, the waste heat this produces is used to generate electricity, normally in a ratio of about 6 units of heat to 1 unit of electricity.

What all this means is that micro CHP is classed as a low-carbon technology because it generates electricity by using a waste product rather than burning more fossil fuels. Because of this, domestic CHP installations are eligible to be paid (11p/kWh) under the FIT (Feed-In Tariffs) Scheme.

Typically the monetary benefits with an average system are:

• A saving on your electricity bill of around £60
• Your energy (FIT) supplier paying you a Generation Tariff for every unit of electricity you generate, totaling around £180 a year
• Your energy (FIT) supplier paying you an Export Tariff (4.5p/kWh) for every unit of electricity you don’t use and export to the grid, totaling around £30 a year
• This makes a total monetary benefit of £270 a year
• You can also fund the installation through the Green Deal scheme which provides an affordable finance plan where you pay money back through the savings you have made on your energy bills

There are several different types of CHP system available, however only one has been fully developed as a micro CHP system for the domestic market: the Stirling engine. Stirling engines produce heat and electricity typically in a 6:1 ratio. A standard system produces around 1Kw of electricity an hour, supplying 46% of an average home’s electricity needs.

Other CHP systems include the commercially used internal combustion engine and newer fuel cell systems which take energy from a fuel through a chemical process rather than combustion.

How Micro CHP Systems Work

In a standard micro CHP system you will use a condensing boiler to heat your water-filled central heating and hot water. The steam that this produces is used to drive a Stirling engine to generate electricity.

A Stirling engine is essentially a sealed box, usually containing one or more linked, gas filled tubes, each containing a piston. One tube is exposed to a heat source, and the other to a cooling source. There is a fixed volume of gas in the tubes, so if the gas expands or contracts it moves the pistons. The gas can be expanded or contracted/compressed in the system by the heating and cooling sources.

The heating and cooling of the gas drives the pistons alternately up and down. The engine is connected to an electrical generator which uses the pistons’ energy to generate an electrical current. The design of the Stirling engine means that it is very efficient at converting heat into electricity, as well as being fairly quiet.

Installing Micro CHP Systems

According to the Carbon Trust homes most suited to a micro CHP system are typically larger or older properties with solid brick walls where insulation is not worth the investment. This is because smaller, better insulated homes have a lower heating requirement which means that less electricity is generated by the system.

The installation process for micro CHP systems is very similar to the process for standard boilers, and so should be fairly simple to carry out, particularly if it is simply replacing a conventional boiler.

Micro CHP System Installation Checklist

There are a few things that should be considered:

• An electricity meter: The FIT scheme needs to be able to monitor how much electricity you are generating with your system because FIT payments are paid per unit of generated electricity. The FIT scheme (Feed-in Tariff) does not currently involve measuring how much electricity you export to the grid, but for an average to low user it is estimated to be about 75% of the electricity you generate
• Freehold or permission from your landlord: If you have leasehold or are renting you will need permission from whoever owns the property
• An available fuel source: Current systems run on mains gas or LPG (Liquid Petroleum Gas) so you will need to be able to supply this
• Wall mounted or floor mounted? Micro CHP systems can be installed either way, but for wall mounted systems you will need a load bearing wall as systems are typically twice the weight of a standard boiler
• Which size unit? Make sure that you get the correct sized unit for your home. A system that is too large won’t be running frequently enough to provide adequate electricity
• Your energy company: Large energy companies have to register as FIT suppliers by law but for smaller companies this is optional. Before you carry out your installation contact your supplier to see what their FIT arrangements are
• Applying for the FIT scheme: You will need to apply to the FIT scheme to receive tariff payments. You can do this by applying to your energy supplier, who will also be your FIT supplier, after you have completed your installation. You will need to fill out an application form and provide a certificate from your installer to prove that your installation is MCS certified
• Are you thinking about carrying out any other building work? You may be able to reduce your installation costs by carrying out the installation at the same time as any other building work you are planning

Installation Time for Micro CHP Systems

The installation time for a micro CHP system should be similar to that of a boiler. If you are incorporating additional building work you will have to consider the time that this will take also.

Micro CHP Installers

To be eligible for FIT scheme payments you will need to hire an MCS accredited installer and the installer will have to use MCS accredited parts in the installation. When your installer has finished the work they will give you a certificate stating that your installation is MCS compliant. Green deal installations will need to be carried out by a Green Deal installer.

Micro CHP Costs

A micro CHP system for an average house will cost around £4,000-£6,000 including installation. It should deliver an energy saving totaling around £60 a year, in addition to Export Tariff payments of £30 and Generation Tariff payments of around £180 a year through the government’s FIT scheme.

These tariff values are available to the first 30,000 households to install micro CHP technology. The lifetime for the CHP system is at least 15 years, and the tariff value is fixed when you start receiving payments as well as being index linked.

To find out more about FIT take a look at our Feed-In Tariffs (FIT) project page.

The government’s newly launched Green Deal can pay for the up front costs of a micro CHP installation. The money that you save using the system is then used to pay back the loan every month. This should make the installation ‘free’ to you as you spend no additional money.

Whilst this represents a great deal you will save more money if you pay for the installation yourself as the Green Deal charges around 7% interest on the payments. You can visit our Green Deal project page to find out more about this scheme.

In terms of maintenance, your installer should be able to give you more information regarding any procedures that need to be carried out. Maintenance should be similar to that of a boiler but you will need a specialist to carry it out, and a professional service needs to be performed every year as with your conventional boiler.

The Benefits of Micro CHP Systems

In addition to the £270 a year saving your system will deliver there are other benefits:

• Reduce the carbon emissions of your home: An average system will save around 2 tonnes of CO2 a year
• Simple and quick installation and maintenance: A micro CHP system is very similar to a boiler, and so the installation and maintenance of the system will be similarly simple