Combined Heat and Power Program - Builder/Contractor


Savings can be just around the corner for any Arizona commercial customer when you choose a Combined Heat and Power (CHP) system.  With our rebates on qualifying CHP systems, your business can benefit from significant long-term savings while saving both energy and money. Energy efficient CHP systems are configured to generate electricity or mechanical power while recapturing the heat produced from electrical generation that can be repurposed for:

  • Space heating
  • Water heating
  • Industrial steam loads
  • Air conditioning
  • Humidity control
  • Water cooling
  • Product drying
  • Other thermal needs

Is a CHP System Right for Your Business?

Eligible high-efficiency CHP generation systems produce localized, on-site power and heat from natural gas. They can vary in size from several kilowatts (kWs) to several megawatts (MWs) of produced electric power, and can be used in a variety of commercial, industrial and institutional applications.

CHP might be right for your business if you have one or more of the following:

  • High electricity prices (more than $0.07 or $0.08 per kWh)
  • Long operating hours of 3,000 - 6,000 per year or more
  • Significant heating, water heating or process loads
  • A central heating and cooling system already in place
  • Spark spread between self generation and utility purchase of approximately $0.03 to $0.04 per kWh
  • An average electric load-to-peak load ratio greater than 0.7

Program Funding

Eligible CHP systems must achieve a total system efficiency of 60% to 70% or higher. This efficiency must be demonstrated during standard operations that will vary according to the type of facility where CHP is utilized. Incentive awards include the following levels up to a maximum of 50% of the installation cost of any project:
Minimum Requirements Rebate Amount 
70% Minimum Fuel Efficiency $500 per kW up to 50% of installed cost
65% Minimum Fuel Efficiency $450 per kW up to 50% of installed cost
60% Minimum Fuel Efficiency $400 per kW up to 50% of installed cost
This program is for active commercial and industrial customers in Arizona only. The Rebate Application must be submitted and approved by Southwest Gas prior to the installation of the CHP system in order to remain eligible for a rebate under the Program.
Submitting an application, however, does not guarantee funding. Projects will be evaluated on their projected fuel efficiency. A study by an Arizona registered professional engineer (PE) will be required prior to the final award.

Please review the rebate application for additional requirements and full terms and conditions.
This program is funded by Southwest Gas Corporation's Arizona customers and administered by Southwest Gas Corporation. This program has been reviewed and approved by the Arizona Corporation Commission. This program may be modified or terminated without prior notice and is provided to qualified customers on a first-come, first-served basis until program funds are no longer available. Eligibility requirements also apply. Southwest Gas Corporation does not make any warranty, express or implied, or assume responsibility for the accuracy, completeness, or usefulness of any information, estimated savings, and benefits attributed to the products that qualify for this program. Reference to any specific product, project, or service by manufacturer, trade name, trademark, or otherwise does not constitute or imply its endorsement, recommendation, or favoring by Southwest Gas Corporation. To qualify, equipment must meet technical requirements and be installed according to local building codes and ordinances and/or manufacturer's requirements. If you have questions visit or call 1-800-654-2765 to confirm eligibility before purchasing products.

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Need More Info? Download a printable application you can send in by mail.  You can also call an Energy Specialist at 1-800-654-2765.