Distributed cogeneration has played a key role in the implementation of sustainable energy policies for three decades. However, increasing penetration levels of intermittent renewables is challenging that position. The paradigmatic case of West Denmark indicates that distributed operators are capitulating as wind power penetration levels are moving above 25%; some operators are retiring cogeneration units entirely, while other operators are making way for heat-only boilers. This development is jeopardizing the system-wide energy, economic, and environmental benefits that distributed cogeneration still has to offer.

The solution is for distributed operators to adapt their technology and operational strategies to achieve a better co-existence between cogeneration and wind power.

Four options for doing so are analysed including a new concept that integrates a high pressure compression heat pump using low-temperature heat recovered from flue gasses in combination with an intermediate cold storage, which enables the independent operation of heat pump and cogenerator.

It is found that an electric boiler provides consistent improvements in the intermittency-friendliness of distributed cogeneration. However, well-designed heat pump concepts are more cost-effective than electric boilers, and in future markets where the gas/electricity price ratio is likely to increase, compression heat pumps in combination with intermediate thermal storages represent a superior potential for combining an intermittency-friendly pattern of operation with the efficient use of electricity in heating and cooling production.