This study explores a method of generating electricity while recovering waste heat through the integration of heat pipes and thermoelectric generators (i.e. HPTEG system). The simultaneous waste heat recovery and power generation processes are achieved without the use of any moving parts. The HPTEG system consists of bismuth telluride thermoelectric generators (TEG), which are sandwiched between two finned pipes to achieve a temperature gradient across the TEG for electricity generation. A counter-flow heat exchanger was built using two separate air ducts. The air ducts were thermally coupled using the HPTEG modules. The evaporator section of the heat pipe absorbed the waste heat in a hot air duct. The heat was then transferred across the TEG surfaces. The condenser section of the HPTEG collected the excess heat from the TEG cold side before releasing it to the cold air duct. A 2-kW electrical heater was installed in the hot air duct to simulate the exhaust gas. An air blower was installed at the inlet of each duct to direct the flow of air into the ducts. A theoretical model was developed for predicting the performance of the HPTEG system using the effectiveness-number of transfer units method. The developed model was able to predict the thermal and electrical output of the HPTEG, along with the rate of heat transfer. The results showed that by increasing the cold air velocity, the effectiveness of the heat exchanger was able to be increased from approximately 52% to 58%. As a consequence of the improved heat transfer, maximum power output of 4.3 W was obtained.