This thesis investigates a new externally heated engine design being developed by Soony Systems Inc. to serve as the prime mover in a residential-scale combined heat and power system. This is accomplished by developing a thermodynamic model for the engine and sweeping through the design parameter space in order to identify designs that maximize power output, efficiency, and brake mean effective pressure (BMEP). It was discovered that the original engine design was flawed so a new design was proposed and analyzed. The thermodynamic model was developed in four stages. The first model was quasi-static while the other three were time-dependent and used increasingly realistic models of the heat exchangers. For the range of design parameters investigated here, the peak power output is 6.8 kW, the peak efficiency is approximately 60%, and the peak BMEP is 389 kPa. These performance levels are compared to those of other closed-cycle engines. The results suggest that the Soony engine has the potential to be more efficient than Stirlings

because it more closely approximates the Carnot cycle, but this comes at the cost of significantly lower BMEP (389 kPa vs. 2,760 kPa for the SOLO Stirling engine).