The order "establishes a new national goal of 40 gigawatts of new combined heat and power capacity by 2020," the White House said in a statement.
That would be a 50 percent increase above current capacity.
Furthermore, "meeting this goal would save energy users $10 billion per year, result in $40 (billion) to $80 billion in new capital investment in manufacturing and other facilities," the statement said.
The order for "40 gigawatts of new combined heat and power capacity" refers to specific systems that include on-site power generation and heat retrieval systems. The CHP or combined heat and power goal, the White House said, would result in a reduction of harmful greenhouse gas emissions equal to the amount produced by 25 million cars.
"This action will cut costs, increase efficiency, and help our businesses create strong, middle class jobs. We'll continue to do everything we can to put more people back to work and build an economy that lasts," the president said.