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Combined Heat and Power systems, referred to as CHP systems, generate electricity and hot water. They basically consist of a gas-powered engine which turns an electrical generator. Modern units will also have advanced control systems which can synchronise the system with the Electricity Supply Board's system and allow excess electrical capacity to be sold to the ESB. They also have options for being remotely monitored and checked by the supplier via computers and modems. The hot water that would go to the radiator in a conventional engine is passed through a heat exchanger for use as space heating as well as supplying hot water requirements.
These systems are extremely efficient, but to be an economic proposition, there must be both a steady minimum electrical demand and a corresponding minimum demand for hot water for a large proportion of the day. The smallest of these units is relatively large, and so CHP units are generally only applicable to larger consumers, such as industrial users and hotels with swimming pools.