Numerical optimization and economical issues in the design of a small-scale cogeneration systems

Cogeneration (or Combined Heat and Power, CHP) is the simultaneous production of electrical and thermal energies. These systems are becoming an attractive way to produce energy due to their higher efficiency and lower pollutant emissions. The purpose of the thermo-economic optimization is to find the ideal characteristics of the thermal system that will lead to the optimum design of a small cogeneration system, maximizing the annual worth. The energy system may be described as a thermo-economic optimization problem through the definition of an objective function, constrained by physical limitations imposed by the cogeneration plant. The model includes the maintenance and operation costs for each component of the plant, the income from selling electricity to the grid and the avoided cost associated to the conventional heating system. The optimal values for the decision variables, according to the specified conditions of the system, were achieved by applying the Box Method implemented in MatLab. This nonlinear numerical optimization method proved to be an effective tool to determine the optimal characteristics of the cogeneration plant. The results show that the fuel costs have the greatest weight in the total operating costs of the system. The optimal solution for the small-CHP is sensitive to capital cost, fuel price and electricity feed-in-tariff