The Role of Incentives in Promoting CHP Development

摘要

State policies and regulations can help mitigate or eliminate regulatory and market barriers that stymie the installation of combined heat and power (CHP) systems, especially barriers imposed by utilities that resist distributed generation. Financial incentives can play a role in promoting CHP development by mitigating the additional costs that result from these barriers. To help focus the priorities of state policymakers and regulators, this paper analyzes CHP installation data and compares them for each state to regulatory policies and financial incentives applicable to CHP. Based on our analysis, we suggest that states should focus primarily on eliminating regulatory barriers, while using financial incentives to complement regulatory reform and encourage CHP development.