Company: Genscape International, Inc.
Published: 10 April 2014
In this paper (in English and German), Genscape has analysed Combined Heat and Power or Central Heat and Power (CHP)production in the German market, the challenges it raises for market participants, and the key steps required to address the fundamental lack of transparency in CHP plant production.
CHP designed power plants are highly efficient as they simultaneously generate usable heat and power in a single process. Whilst initial costs are higher than a normal power plant, once in operation, it is 25% to 30% more efficient than a traditional power plant.
Currently, the German supply-stack contains 452 identified CHP generation units for just-under 49 GWs of combined capacity. This generation doesn't participate in the power markets the way conventional generation does, since many of the units are of a lesser size, or are owned and operated by local municipalities. As a result, regular disclosure of any kind of unit-by-unit availability isn't requested or expected by regulators, and market participants aren't able to incorporate CHP
production data in trading strategies and analysis. Currently, the German Statistisches Bundesamt requires CHP plants to report monthly total production with a 3 month delay.
Given the above challenges, this paper addresses what factors have led to the lack of transparency in German CHP production, why no changes have been effected to mitigate the situation, and what can be done to bring about change.
Genscape customers have indicated that with the increased amount of renewables available as a resource to the market, more transparency around all types of power supply are needed to understand the physical price and flow of power.
In conclusion, Genscape - through its network of proprietary power monitors and data capture - will demonstrate recommended solutions for market participants to overcome the challenges addressed in this paper.