Combined heat and power: Correlation
Prices it moves with, and why
CHP plants are bought as engines or turbines plus heat recovery, priced per project. The proxy is the US turbine and generator index. Running economics depend on the spark spread: the value of power and heat produced against the fuel price, usually gas.
Proxy US PPI: steam, gas and other turbines and generators index · monthly, Jan 2006 to Sep 2026There is no free public price for combined heat and power itself, so this tab uses the closest public series as a stand-in. Read the numbers as an indication, not as the price of this exact item.
What its price moves with
Selected linkCombined heat and power and Natural gas
Monthly changes 0.04 little or none correlation 12-month changes 0.00 little or none correlation Last 5 years 0.05 monthly changes Lead or lag none No clear lead or lag Price function, Jan 2006 to Sep 2026 Combined heat and power ≈ 130.1 × (Natural gas)0.03 R² 0.02 On this fit, a 10% higher natural gas price goes with a 0.3% higher combined heat and power price over the long run. Units: index and $/mmbtu. The fit is loose, so treat the function as a rough guide.Chart: Combined heat and power and Natural gas prices rebased to 100 at Jan 2006, log scale
Both prices rebased to 100 at Jan 2006, on a log scale so equal percentage moves look the same size.Chart: Combined heat and power price against Natural gas price, monthly, log scales, with fitted line
Each dot is one month; paler dots are older (2006), darker dots recent (2026); the ringed dot is the latest month. The dashed line is the fitted price function. Both axes are logarithmic.Most CHP runs on natural gas, so gas prices set running costs and the spark spread. The turbine proxy does not follow gas, with monthly moves correlating at 0.04, because equipment prices are set by makers' order books, not fuel markets.
little or none co-movement month to month · 234 months Show chartsSmaller CHP units use gas engines, larger ones gas turbines. Yearly moves correlate at 0.21 with the engine index, a weak link because the two indices cover different machines and different buyers.
little or none co-movement month to month · 234 months Show chartsCHP is worth more where grid electricity is dear, since each unit made on site is a unit not bought. The equipment proxy shows no link with the electricity price, at -0.04 monthly, as tariffs change slowly and turbines are priced on orders.
little or none co-movement month to month · 233 months Show chartsMany CHP plants, especially in industry and on biomass, use boilers to raise steam for a turbine and heat. Monthly moves correlate at 0.26 with the boiler proxy, a modest link from shared projects and fabrication costs.
weak co-movement month to month · 234 months Show chartsDistrict heating networks, common in northern Europe and China, take the heat from CHP plants and are the main reason city-scale CHP is built. Heat networks have no price series here, so this link shows as text only.
Not enough overlapping price history to measure.Biogas and biomethane from farms and landfills often fuel CHP engines. The proxy, US natural gas, shows no link with the turbine index, at -0.04 monthly, since equipment prices follow manufacturing rather than fuel.
little or none co-movement month to month · 234 months Show chartsHow to read these numbers
Correlation of monthly changes (the number in the coloured pill) compares how much each price moved, month by month, since 2006 or the first month both series exist. It runs from −1 to +1: near +1 the two usually rise and fall in the same months, near 0 there is no link, and a negative number means they tend to move in opposite directions. Above 0.7 is strong, 0.4 to 0.7 moderate, 0.2 to 0.4 weak.
12-month changes compare year-on-year moves, which shows whether two prices share the same cycles even when the month-to-month noise differs.
Price function is a straight-line fit of the two prices on logarithmic scales: price ≈ k × (partner price)β. β is how much this price moves, in per cent, for a 1% move in the partner over the whole period, and R² is the share of the variation the fit explains. Two prices that both drift up with inflation can fit well without any real link, so read it together with the monthly correlation.
Lead or lag checks whether the monthly correlation is clearly higher when one price is shifted by 1 to 6 months.
Correlation is not cause. The reasons on each card explain the economic link; the numbers show how strongly it has shown up in prices. Proxy series are US producer price indexes or related prices and can blur the real link.
Data: World Bank Commodity Price Data (Pink Sheet), October 2026; US Bureau of Labor Statistics producer price indexes, IMF primary commodity prices and US EIA prices via FRED, Federal Reserve Bank of St. Louis, retrieved November 2026. Calculations by this site.