Prospects for utility ownership of cogeneration
Limitations on the potential for fuel-user development of cogeneration motivated an analysis by these authors of utility attitudes towards investing in such decentralized power facilities. Utility ownership of cogeneration has been limited, partly because equity participation greater than 50 per cent excludes utilities from the regulatory and economic incentives offered to fuel users under existing law. Development of cogeneration markets is likely to be greater if this rule is repealed, for reasons discussed here, and the efficiency benefits of this increased expansion are likely to offset possible adverse anticompetitive effects. The need for additional capacity and the availability of capital are the two critical determinants of the extent to which utilities will invite in cogeneration projects, the authors found. Thus, while short-term prospects may be limited to utilities that need capacity additions and are able to finance new construction, repeal of the ownership limitation could have more profound long-term implications as reserve capacity margins narrow and utilities recover from capital availability difficulties. 2 tables
- OSTI ID:
- 5185681
- Journal Information:
- Public Util. Fortn.; (United States), Journal Name: Public Util. Fortn.; (United States) Vol. 113:3; ISSN PUFNA
- Country of Publication:
- United States
- Language:
- English
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