A Knowledge-Based Decision Support System for Combined Heat and Power Investment Appraisal and Plant Selection

Abstract

Combined heat and power (CHP) can, in the most suitable cases, reduce a consumer's total energy costs by up to 40 per cent. It is important to stress that CHP is not viable at all sites and further that poor choice of CHP plant often results in inefficient and uneconomic operation. It is therefore vitally important to build a clear picture of what specific factors determine the profitability of a CHP scheme. The development of an accurate, reliable economic model is necessary for any sector where a potential market for CHP exists. Conventional economic models have a number of limitations, particularly where situations involve a high degree of risk and uncertainty. This paper shows how decision analysis techniques can be combined with a conventional spreadsheet to overcome these weaknesses and demonstrates the power and flexibility of the resulting model with a case study.