The primary purposes of this paper are to describe a practical model which can be used to assist economic evaluation of district heating proposals, with particular reference to potential micro combined heat and power (CHP) applications, and to discuss the results of applying this model to a proposal for a particular scheme. The problems of realistic simulation of demand patterns, and the sensitivity of micro‐CHP project values to scale, fuel prices, differential purchase/selling tariffs for electricity, duty cycle and plant utilization factors are discussed. Of several options, two were shown to be economically viable, relative to existing methods of supply (gas‐fired boilers); however, the margin of benefit is small relative to wisely chosen modern boiler installations. A brief discussion of alternative methods of finance is provided; ceteris paribus, the proposed scheme would not be likely to attract venture capital from would‐be lease‐hire agencies. There is scope however for pilot schemes, whose results could be used to define more closely the limits of uncertainty of, for example, annual availability and duty cycle influences on the cost economics of operations.
This paper compares methods of energy management in Japanese and British industrial companies. It is based on the premise that Japanese industry has been more successful at adopting energy conservation measures and aims to highlight differences between the two countries' approaches to energy management.
In both successful Japanese and British companies the value of energy monitoring and target setting is stressed. In Japanese companies the information gained from monitoring is pushed out to the shopfloor employees who can use the information in ‘good housekeeping’ campaigns. In British companies monitoring information is usually held centrally, thus reducing its usefulness in good housekeeping. The decentralisation of information in Japan, coupled with the encouragement of employee participation results in Quality Circle type exercises aimed at implementing energy conservation measures.
At the investment level of energy management co‐ordination and systematic thinking is necessary in order to prevent sub‐optimisation of investments. Japanese companies are notable for their very detailed explicit planning of energy management, something few if any British companies practice. This planning process, as well as encouraging employee participation through being bottom up, also encourages systematic thinking about the linkages of energy conservation investments to other parts of the business such as new plant investment and marketing.
As well as the managerial factors the legal requirement in Japan for companies with a certain energy consumption to have a qualified energy manager with certain legally defined duties helps to encourage energy conservation.
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