CHP and PA Tier II AECs
Combined Heat and Power (CHP) systems may qualify for PA Tier II Alternative Energy Credits under one of two eligibility pathways, depending on system size.
Distributed Generation
CHP systems under 5 MW nameplate capacity
CHP systems below the 5 MW threshold may qualify as distributed generation under PA Tier II. AEC issuance is based on metered electrical output of the CHP system.
Demand-Side Management
CHP systems 5 MW or greater
Larger CHP systems may qualify as a Demand-Side Management (DSM) measure. Onsite generation that displaces grid electricity consumption is characterized as a demand-side load reduction.
Timing and issuance
Under both pathways, PA Tier II AECs are issued forward from PennAEPS certification date. AEC eligibility, sizing, and calculation depend on your specific system's certification pathway, fuel source, and operational profile. Because these details are project-specific, we recommend a direct eligibility review.