Economic and environmental assessment of residential micro combined heat and power system application in Japan

• Simulation for residential micro combined heat and power system was performed.
• Economic analysis revealed that the target cost was about half of the current cost.
• Application of a micro-CHP would reduce the carbon dioxide emission of home by 19%.

In May 2009, residential micro-combined heat and power systems (micro-CHPs) were launched onto the market under the standard name of “ENE⋅FARM” in Japan. Operation of the latest type released in 2015 was simulated (using commercial software) with the averaged load data from an actual demonstration project in Japan. Simulation results were then used in economic and environmental analysis. Economic analysis revealed that the target cost of a micro-CHP including the back-up boiler is about $6200 under current Japanese grid prices. This target is a capital cost to achieve the economic feasibility within ten years, and is approximately half of the current actual cost. According to environmental analysis, carbon dioxide emission (CDE) reduction with a micro-CHP is reliable even when the CDE factor of the grid electricity is as low as 200 g-CO2/kWh. Under the current CDE factor in Japan, the application of a micro-CHP would reduce the CDE of the respective home by 19%.