Economic analysis of heat and electricity production in combined heat and power plant equipped with steam and water boilers and natural gas engines

Highlights: • The mathematical model of hard-coal CHP operation with gas engines is developed. • Various CHP operation modes are studied to select the most profitable scenario. • The CHP operation in transient seasons with varied energy demands is studied. • The use of natural gas engines increases the profitability of CHP when subsidy is available. - Abstract: This paper deals with the cost and energy efficiency for heat and electricity production. The operation of the medium size Combined Heat and Power plant, located in Poland, with diverse production units: steam boilers, water boilers and gas engines is studied. The analysis is performed for spring-autumn season, characterized by relatively low and variable heat power demand. Due to such mutable conditions production units are forced to operate out of the nominal efficiencies. The analysis is performed for heating and electric energy production on: steam boilers and turbo-generator, water boilers, steam boiler and gas engines; and water boiler and gas engines. To reflect the actual situation, a mathematical model for the complete installation is developed. The model calculates energy balance for a given heating power demand profile. The model is based on the actual parameters, including all technical aspects and equipment's limitations. The developed tool enables to select the mode of operation for each production unit separately or in combined mode. As a result, the energy balance in one hour operation period is calculated. Such approach allows to compare the energy production efficiency and cost in each system at every hour. Due to the fact, that nowadays heat and electricity production business, is strongly affected by legal regulations, the analysis of gas engines profitability with and without subsidy for natural gas based co-generation is performed.