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Combined Heat and PoweR

Learn more about cash incentive programs that provide reimbursement
for combined heat and power (CHP) projects.

Ohio commercial, industrial, governmental and institutional customers of FirstEnergy’s Ohio utilities (Ohio Edison, The Illuminating Company and Toledo Edison) may apply for energy efficiency rebate incentives for qualifying Combined Heat and Power (CHP) projects under the Custom Program.

Eligible Measures

Eligible CHP projects must meet the following requirements:

  1. Generators will be driven by turbines or internal combustion engines coupled to generators, where waste heat is used to support the customer’s process.
  2. The thermal output must be used within customer’s process and/or building systems. The design of the system shall take into consideration the application of a technology (e.g., absorption chillers) that will use the thermal output to further reduce the customer’s electric load.
  3. CHP design must have a designed operating efficiency of at least 60% (relationship of useful electric and thermal output verses the fuel input), and the system must recover at least 20% of the system’s useful energy in the form of thermal energy. The customer must install the required metering to support the measurement and verification process for the project (i.e., to assess electric energy output and annual performance).
  4. The preferred fuel source is natural gas or biogas.
  5. The full CHP electric energy generated is intended solely for on-site use by the customer and shall not exceed the customer’s on-site, average electric energy needs.
  6. Unless otherwise permitted under the company’s tariff, the design of the system shall be such that the generation equipment is controlled to meet the on-site energy requirements, thus providing no hourly energy export under normal operating conditions.
  7. All installations must be determined to be cost effective using the Total Resource Cost (TRC) test. A TRC of greater than or equal to 1 is considered cost effective. Contact a program representative for TRC assistance.
  8. All installations must meet all appropriate environmental regulations, and owner must attest that the facility is in compliance with all local, state and federal regulations.
  9. Waste Energy Recovery (WER) projects are also eligible.

Pre-Approval Requirements

Program participants are required to seek pre-approval before purchasing their equipment to ensure that it meets program requirements and is eligible for incentives.

Effective Dates

To qualify for incentives for a CHP project through the Custom Program, equipment must be new and installed after receipt of the formal pre-approval letter from the program administrator.  All installations must be installed and operational (generating) by Dec. 31, 2019.


Incentive payment is subject to approval from FirstEnergy’s Ohio utilities, will be a singular payment and will be based up kilowatt-hour (kWh) savings results supported by one year of data, post project commissioning. On an exception basis, a single payment may be extended at the companies’ sole discretion for up to five years from the point of commissioning.

Incentives rates for approved projects in years 2018 and 2019 are:

$0.05/kWh recovered for systems <1,000 kW.

$0.035/kWh recovered for systems >=1,000 kW.

Final incentive amount will be calculated based on the following criteria:

Any incentive cap(s) will be communicated at the time of project pre-approval.

[1] Energy Savings capped per ORC 4928.66(A)(1)(a)

How Do I Apply For Incentives?

Step 1 – The participant should complete and submit a Custom Program application for the CHP project and upload the following list of required documents through the online application portal.

Required documents for application pre-approval:

  1. Completed and signed W-9 tax form for the incentive payee.  The W-9 form must be current and dated within the last 24 months.
  2. Copy of utility bill to confirm account number and service address.  If desired, the participant may redact all cost- and rate-related information.
  3. Executive summary of project, which is to include project scope, intended use for heat output, project costs and all other relevant project related details pertaining to FirstEnergy’s Ohio utilities tariffs or policies.
  4. Pre- and post-installation equipment specifications and operating assumptions, including replaced heating equipment as well as proposed backup boiler and fuel conditioning equipment.
  5. All energy calculations associated with the project, including hourly heat and electric load analysis for the facility.
  6. Manufacturer’s specification cut sheets to verify size, technology and efficiency levels of proposed/installed equipment including generator, engine and backup heating/fuel conditioning.
  7. Completed Total Resource Cost Test (TRC) calculator.
  8. Please include a checklist of the following key information provided, along with location (e.g., file name or page):
    1. Executive summary
    2. Facility hourly load analysis
    3. Calculation of annual proposed, gross generation (kWh)
    4. Calculation of annual auxiliary equipment usage such as heat rejection, gas conditioning and backup systems (kWh)
    5. Calculation of annual generation to be used on site (kWh)
    6. Estimated peak kW offset at the facility. Peak kW savings are defined as the facility load offset in the hour ending 5 p.m. on the hottest summer weekday
    7. Manufacturer’s specification cut sheets

Step 2 – The program administrator will notify the applicant, via email, when the application review is complete and application is pre-approved.

Step 3 – During construction and prior to commissioning of the CHP project, a pre-inspection will be conducted.

Step 4 – Upon completion of CHP system construction, participants should review pre-approved project application and submit the following documents to the program administrator for review:

  1. Document listing any changes to project scope of work during construction
  2. Revised engineering and related energy savings analysis/calculations (if changes were made during construction)
  3. Detailed, itemized invoices or proofs of purchase for the equipment installed
  4. Completed letter of attestation on customer letterhead, signed by the customer

Step 5 – After CHP project is commissioned:

  1. After 12 months of CHP project commissioning, participant is to provide 12 months of metered data (kWh, MMBTU/hr, fuel consumption/hr) of the CHP system to verify the energy efficiency performance of the new CHP system.
  2. Supporting technical documentation will be reviewed by the program administrator, and an on-site inspection to verify the installation and operation may be conducted.
  3. Upon receipt and verification of all required documentation and energy efficiency performance of the new CHP system, the incentive check will be processed and mailed to the applicant or to an authorized representative, if requested on the application.

Apply online for Combined Heat and Power incentives today or contact us at 866-578-5220.