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Cogeneration/Combined Heat and Power

Generating electricity and thermal energy onsite

Cogeneration, or combined heat and power (CHP), is a great opportunity to save energy costs and increase your system reliability. Typically, it can make sense for businesses that have high annual hours and a continuous thermal load to take advantage of the thermal energy produced. Examples of these types of businesses include hotels, hospitals, nursing homes, pools and health facilities.

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What you get

We provide incentives for cogeneration/CHP projects that meet minimum efficiency requirements and are cost-effective. Current incentive rates are listed below.


Electric$0.45 per kWh on first-year savings
rebatesUp to 70% of the incremental cost compared to PSE's combined cycle power plant system for cost-effective projects

Grant applies to whole-building performance savings beyond a baseline energy use intensity (EUI) as measured by 12 months of metered consumption.

How you qualify

To be eligible for PSE's cogeneration/CHP incentives:

  • You must be a PSE business electric customer.
  • You must be pre-approved by PSE prior to installation of all energy-efficiency measures.
  • Cogeneration systems must have useful thermal energy output of no less than 33% of the total energy output.
  • The system must use natural gas as the input fuel. Renewable energy power generation or CHP using waste energy are not included in this measure. CHP using waste energy is considered an energy-recovery measure that may be incentivized through our Custom Retrofit Grants program. Renewable energy may be incentivized through our renewable energy programs.
  • All energy output must be used on site (no energy output to grids).

How you apply

To get pre-approved, please submit your completed custom grant application form.

Questions? Get in touch with an Energy Advisor.

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Or call 1-800-562-1482.