ABSTRACT
This paper chronicles the history of cogeneration development in the State of California, USA, and outlines the conditions necessary for its development. Of particular interest is the financing of cogeneration projects in the United States including cashflow analysis, risk analysis and mitigation. The types of financing structures most commonly used are described along with their risk allocation characteristics. Finally, data is presented for cogeneration projects currently online in California and Texas which shows their reliability exceeds that of the average utility project. However, since concerns about future project reliability remain, the paper examines methods which can be used to reduce these concerns and to reduce the probability of projects being cancelled.
