With 3,000 MW of energy removed from the Southern California grid due to the closure of the San Onofre Nuclear Generation Station (SONGS), new, low cost, reliable distributed generation with combined heat recovery (DG/CHP) is needed. The California Energy Commission Public Interest Energy Research (PIER) program awarded UC Irvine's Advanced Power and Energy Program and its partner, Mazda North American Operations, funding to install and test a low-cost, small-scale micro-DG/CHP system (with electric output <35 kW) using a Mazda rotary engine in laundry facilities. This new DG/CHP design is targeted to meet CARB 2013 certification by reducing criteria pollutants and GHG emissions. Based on the use of this system's compact rotary engine and unique application of waste heat recovery to address both hot water needs for washing, and hot air needs for drying, it is expected that the system would be a valuable and welcome addition at the estimated 3700 or more laundry facilities in the SONGS service territory targeted by the CEC program. In addition, the system should find application at the more than 8,000 laundry facilities throughout California. Finally, this program will provide a demonstration of the applicability of the Mazda rotary engine for micro-DG/CHP applications beyond laundry facilities, with wide spread application of the micro-DG/CHP system having the potential to reduce congestion on electric grid transmission and distribution lines within the SONGS service territory and beyond.