On Tuesday, Virginia Governor Terry McAuliffe signed Executive Order 57, directing state agencies to deliver concrete recommendations for carbon reductions by next spring—effectively a play to circumvent the legislature and advance energy planning under the Clean Power Plan.
While news coverage has focused on the fight between the governor and the legislature, the real hidden story is the opportunity for Virginia industrial manufacturers to make huge gains by ensuring industrial efficiency is a cornerstone of Virginia’s state energy plan.
Virginia has some incredibly energy-intensive industries—especially the paper and chemical manufacturing sectors. Paper and chemical manufacturers spend huge percentages of their annual operating budgets on energy bills. Reducing energy use through energy efficiency, and producing energy on-site through hyper-efficient combined heat and power systems (CHP), have the potential to save individual manufacturers up to 50 percent on annual energy costs, making them more globally competitive.
Here are a few statistics to ponder:
- According to the U.S. Energy Information Administration, Virginia’s industrial sector consumed nearly 20% of the total energy used statewide in 2014. This gives you a sense of the huge opportunities for savings in this sector.
- Virginia ranks 8th in the nation in terms of its CHP potential for paper manufacturing, and 13th for the chemical sector.
We’ve talked about CHP on this blog before. But, here’s a refresher on why it’s important: Conventional power generation is incredibly inefficient. Roughly two-thirds of the fuel that gets burned—whether coal, natural gas or otherwise—is lost as wasted heat.
With a CHP system, a manufacturer can produce both heat and electricity from a single fuel source, on-site. Instead of paying a hefty utility bill, a manufacturer becomes its own power generator, producing energy for heating and cooling far more efficiently and cheaply than a power plant can. That translates to real savings for the manufacturer, and reduced demand for power from the grid. And, a typical CHP unit produces electricity with one-half the emissions of a conventional power plant—hence the importance of CHP to state energy planning under the Clean Power Plan.
Virginia’s hospitals and factories have already shown they are on board with CHP, with 50 facilities producing 1,700 MW of clean and efficient power. We are just scratching the surface of Virginia’s real potential, though. According to a new survey from the Department of Energy, Virginia has the eleventh highest CHP technical potential in the nation (4,308 MW)—the equivalent of more than eight conventional power plants. This represents more than twice the current capacity (1,729 MW) in the Commonwealth.
In the Clean Power Plan, EPA set emission targets for states – but gives them flexibility to determine the best way to achieve them. EPA recognizes that CHP and waste heat to power or WHP—wherein waste heat is used to power chillers and other systems– can provide a readily-available, cost-effective source of emission reductions. Virginia should use this flexibility to jumpstart CHP and WHP deployment and help make its manufacturing sector more competitive.
Think of it: If Virginia deployed just 25% of its technical CHP potential, it would be able to meet 27% of its emissions reductions, while saving its manufacturers money in the process—thereby making them more globally competitive. That’s the real opportunity presented by the Clean Power Plan, and by Governor McAullife’s move to push for concrete carbon reduction strategies. Click here to read our statement in full.