A cogeneration system produces two useful forms of energy: power and thermal energy. While there is no engineering requirement that the power be available as electrical energy, almost all cogeneration systems in operation today produce electricity. That power may be used internally at the site to reduce purchases from the local electric utility, exported and sold to some utility for resale by them or perhaps sold directly to an energy end-user, or some combination of these options. In many cases, that same cogenerator or end-user will rely on the local electric utility for either supplemental or standby power. The result is that the typical cogeneration system must accommodate the flow of power in two directions: both from and to the electric utility. In smaller systems, the cogeneration system may be developed to allow for power flow in only one direction. In any event, the most cost-effective approach to cogeneration is frequently one in which the cogenerator's generator is interconnected to the electric utility grid. This chapter reviews the technology by which power is generated and by which the cogeneration system is interconnected both with the grid and with the site distribution system.