1. Nag Patibandla New York State Energy Research and Development Authority Albany, New York “Selling” the concept of CHP and advanced metering – garnering stakeholder buy-in METCOGEN, 6-8 October 2004, New York

2. New York’s DG (/CHP) Incentives $15 Million SBC Funds through NYSERDA Standby Service Rates: CHP Exemptions and Phase-ins Std. Interconnection Requirements (in Update) Electric Utility DG Pilot Program (Grid Upgrade vs. DG) DG Gas Distribution Prices + Gas Utility DG Programs State Education Dept Funding for K-12 Schools NYC EDC – Energy Cost Savings Program Elimination of flex-rate deterrent (in development) Air Emissions Standards (in development) Emissions Reduction Credits (in development)

3. NYSERDA’s DG-CHP Program Develop & Demonstrate Innovative DG Technologies & CHP Applications Support site-specific and sector wide feasibility studies and replication Monitor Performance and Reduce Hurdles through Shared Knowledge Install Megawatts of Generation Capacity Funding: Cost share of 30 – 60% of Project cost subject to a cap of $1 million per project

4. Where Does DG/CHP Make Sense Capacity constrained- High electric demands High thermal (steam, hot water, or direct heat) demands Coincident thermal and electric demands Extended operating hours Access to fuels (byproducts, natural gas) Grid Capacity Utilized at 60% 30% CHP – On Peak Only Operation On Customer Side On Utility Side

5. Cumulative CHP Market Penetration Projection by 2012 (MW) CHP System SizeBusiness As UsualAccelerated 50 to 500 kW 0 61 500 kW to 1 MW 92331 1 MW to 5 MW204699 5 MW to 20 MW208704 > 20 MW260374 Total7642,169

6. CHP Benefits At Full Market Penetration CHP BenefitsBusiness As UsualAccelerated Economic Savings ($ million) 2012 Annual$109$487 Cumulative (02-12)$536$1,825 Net Present Value$253$808 Energy Savings (trillion Btu) 2012 Annual2574 Cumulative (02-12)118316 Annual Emissions Savings After 2012(tons/year) NOx3,21010,282 CO21,259,0003,854,000 SO29,77827,766

7. NYSERDA’s DG-CHP Demonstration Program Installations (kW) TechnologyNo. of ProjectsTotal CapacityTypical Size Engines6080,214500-750 Gas Turbines115,500N/A Microturbines223,42860-75 Steam Turbines54,398300-500 Fuel Cells85450200-250 Totals96108,9901,000

8. SUNY Buffalo/Grester Trane Two 60 kW Capstones Peak Reduction: 300 kW Application: Swimming Pool – Power to water pumps – Heat to electric water heaters Funding: NYSERDA: $310000 + SUNY & Grester Trane: $310,000 Status: Currently Operational Savings: 2000 MWh/yr, $73,000 per year

9. Greater Rochester International Airport Two 750 kW Natural gas Recip. engines Heat recovered for space and DHW heating and a 300 ton absorber NYSERDA: $500,000; GRIA $2,000,000 Status: Fully Operational.

10. Waldbaums Supermarket Utilize one Capstone 60 kW Microturbine. Integrated with Munters DryCool Desiccant. Annual energy savings of over $50,000 with a six- year payback Good opportunity for technology transfer. Lessons in Interconnection.

11. Bulova @ LaGuardia Airport Building has been converted from the headquarters of Bulova Watch Co. to a state of the art office building. Utilizing (2) 350-ton gas engine driven chillers. Peak Demand Reduction of 526 kW Excellent thermal efficiency.

12. Fuel Cells at WWTP in NYC Eight UTC PAFC Fuel Cells at Four Municipal Waste Water Treatment Facilities in New York City (NYCDEP) Heat Recovered to Support Anearobic Digester Reduced On-site Emissions by Eliminating Flare NYSERDA: $1,000,000; NYPA: $12,000,000 Four currently Operational.

13. DG-CHP Challenges Regional CHP Activity - Lack of similar CHP (/DG) interest among various states Standby Rates - NYS PSC developed standby tariffs with CHP exemptions and phase-ins, other states like MA are in the process of developing tariffs Emissions Standard - NYS DEC is in the process of developing air emissions standards. Others ? Interconnection – NYS is in the process of updating its SIR to 1 MW and to networks Utility Buy-In - Grid support, congestion mitigation, alternative to grid expansion/upgrade, utility ownership or access to excess capacity

14. Net Metering Net metering turns the electric meter backwards when the DG is producing energy in excess of the demand. Enables the use DG to offset consumption over a billing period. Customers receive retail prices for the electricity produced and used onsite. Without net metering, a separate meter measures electricity that flows back to the utility typically at a wholesale price that is much lower than the retail rate.

15. Net Metering In 2002, Governor Pataki signed a farm net metering law that required utilities to provide net metering to farms that generate electricity from methane wastes. – 400 kVA or smaller, 80% methane waste, on farm-uses – typical farmer can save about $6,000 a year in energy costs Residential PV systems smaller than 10 kW enjoy net metering benefits also.

16. New York’s CHP Program Summary Supporting 96 demo projects, 50+ feasibility/Tech Trans. studies – NYSERDA funding of $47 million (in ~$220 M) – 27 Projects with a total installed capacity of 12 MW in operation – Expect to reach 20 MW of capacity the end of 2004 (peak demand reduction of 26 MW) – Additional capacities of 40 MW and 48 MW in ’05 and ’06, respectively CHP applications in industrial, agricultural, municipal, institutional, commercial, and residential sectors Field-Performance: Monitoring and Data Collection is Underway