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Summary and conclusions

Summary and conclusions

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It was recognized in the 1970s and beyond that cogeneration can be a strong instrument in primary energy savings and in reducing CO2 and other emissions. Thus, promotion of cogeneration has been one of the goals in energy policy and for this purpose, special laws and regulations started being issued, first in the United States of America and then in other countries worldwide as well as in the European Union. Also, the International Energy Agency in Paris recommends cogeneration as an effective means to reduce fossil fuel consumption. Among other subjects, rules for the cogeneration systems to be eligible for financial and economic incentives have been issued, as well as for their participation in the electricity market. The gap between the fuel and electricity price affects crucially the economic viability of cogeneration. Furthermore, it is noted that cogeneration may have difficulty in penetrating both `close-to-slow-opening' and fully liberalized electricity markets. Thus, the regulatory and legal framework needs to be updated from time to time.

Inspec keywords: power generation economics; power markets; government policies; incentive schemes; cogeneration

Other keywords: regulatory framework; close-to-slow-opening electricity markets; fossil fuel consumption; economic incentives; fully liberalized electricity markets; electricity price; energy policy; economic viability; cogeneration; primary energy savings; legal framework; International Energy Agency; financial incentives; fuel price

Subjects: Energy and environmental policy, economics and legislation; Thermal power stations and plants; Power system management, operation and economics

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