Encina Wastewater Authority’s cogeneration system at their water pollution control facility in Carlsbad, California was optimized to reduce energy costs, reduce air emissions, beneficially use biogas, and increase overall plant reliability. The optimized system continued to recover heat from the engines by using a plant hydronic system for thickened raw sludge heating, digester heating, space heating, and space cooling through the use of absorption chillers. By converting engines to lean-burn combustion, NOx emissions were reduced from 24 to 9.3 tonnes per year while power output was increased from 1,360 to 2,220 kw. Encina Wastewater Authority is currently saving about $260 thousand a year on their energy budget after making a $1.5 million investment. Essentially all of the biogas, produced in anaerobic digesters, is now beneficially used to fuel three of the five engines in the cogeneration system. Previously, a substantial amount of biogas was wasted since only one of the two biogas-fueled engine-driven aeration blowers was permitted to operate at a time. Plant reliability was increased because all five engines (three lean-burn and two rich-burn) were permitted to operate simultaneously.