Developing an effective strategic heating/cooling plan: What key success factors?
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This document discusses key success factors for developing an effective strategic heating/cooling plan. It identifies three main factors: 1) defining the scope and purpose by identifying stakeholders and drivers, 2) developing technical scenarios by quantifying demands, resources, and savings potentials, and establishing supply scenarios, and 3) evaluating framework conditions like ownership, financing, pricing and regulation. It provides examples of how to approach each factor, including identifying relevant stakeholders, balancing demands and supplies in scenarios, and overcoming barriers to investment. The document concludes by emphasizing strategic planning is an iterative process and provides further resources on heating and cooling planning.
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Developing an effective strategic heating/cooling plan: What key success factors?
- 1. Nis Bertelsen nis@plan.aau.dk Aalborg University Sustainable Energy Planning Research Group February 3, 2021 Developing an effective strategic heating/cooling plan: What key success factors?
- 2. Agenda • Introduction • Strategic heat planning: - Identify stakeholders and project drivers - Constructing technical scenarios - Framework conditions, financing and business models • Conclusions and summary
- 3. Introduction Heating is the largest end-use in Europe District heating allows access to many supply sources Smart energy systems and sector coupling exploits important synergies Lund et. al. 2014
- 4. Types of heating infrastructures Djørup et. al. 2019: Definition & Experiences of Strategic Heat Planning
- 5. Heat planning and governance Heating is a local demand • Unlike electricity and gas, heating is situated locally • Often overlooked in national energy policy • Often covered by different regulation: buildings, energy efficiency, fuels etc. If not treated systematically in energy policy and governance: • Significant sector coupling and synergies are missed • Many renewable or efficient heat sources are not considered
- 6. Strategic energy planning • The purpose of Strategic Energy Planning is to address issues with current energy supply and to formulate strategies and plans for transitions. • Strategic heat and cooling planning does differ from planning for other energy carriers due to the local nature of heating and cooling supply. • Interdisciplinary: available resources, energy demands, technical potentials, current legislation, the organisation of the energy sector and the related actors, political drivers and barriers should be considered
- 7. The context of Strategic heat planning Building sector Energy sector Heating project Local government Regional government National government EU, international authorities
- 8. Key success factors in a Strategic Planning Process 1. Scope and purpose - Identify main stakeholders - Identify drivers for district heating projects 2. Technical scenarios - Measure heat demand - Identify potential heat sources - Balance heat savings and supply - Establish scenarios 3. Evaluate Framework conditions and business models - Ownership - Financing - Pricing - Regulation
- 9. 1. Scope, Purpose and Stakeholders in Strategic Heat Planning Scope, Purpose and Stakeholders • Important to identify drivers of the strategic energy planning process: • Climate change, energy security, air pollution, energy poverty etc.. • Multiple drivers are likely to exist: important to figure out which ones align Identification and coordination of stakeholders • Who are the main actors engaged in the process • Industry, high demand consumers, consumers with special needs • Identifying opportunities to involve stakeholders that can play a constructive role in realizing heat plans • Identifying synergies and opportunities for cost-effective district energy systems
- 10. 1. Scope, Purpose and Stakeholders in Strategic Heat Planning Some Stakeholders to Consider: - National Authorities - Local Authorities - Utility Companies - Investors - Researcher / Academia - Developers - Technology developers: geothermal, solar thermal, PV, wind etc. - Excess heat suppliers: industry - Customers and Citizens
- 11. 2. Technical scenario building for strategic heat planning 1. Quantify and locate heat demand 2. Quantify and locate heat resources 3. Quantify and assess heat-saving potentials 4. Establish scenarios for heat supply
- 12. 2. Technical scenario building for strategic heat planning 1. Quantify and locate demands • Measurements of actual demands allow for actual knowledge of distribution of consumption. • Modelling or estimating demands can be a way forward to provide inputs for decision making – see for example Peta4 and Hotmaps. Heating demand Budapest Cooling demand Budapest From Hotmaps
- 13. 2. Technical scenario building for strategic heat planning 2. Quantify and locate heat resources • Strategic heat sources are typically either excess heat or renewable sources • Low district heating supply temperature enables the use of low temperature geothermal resources • Strategic heat sources can thus be low-temperature decentralised renewable such as solar thermal, geothermal heat, or excess heat recovered from compressor machines Geothermal ressources Heat demand Excess heat Geothermal potentials From Peta4
- 14. 2. Technical scenario building for strategic heat planning 3. Quantify and assess heat-saving potentials Input: Primary energy Production Transmission and distribution Building conversion Building distribution Output: Useful energy
- 15. 2. Technical scenario building for strategic heat planning 4. Establish scenarios for heat supply • When establishing these scenarios, keep in mind the i)scope, ii) perspective and iii) timeframe of energy systems analysis • Do not make them too detailed at first! Easy to get lost in technical or legal details. It is important to keep the process moving. Include the level of detail needed to make decisions and move further.
- 16. 2. Technical scenario building for strategic heat planning Methodological points for scenario building: - Energy system scope: - Include entire energy system to identify synergies - Data is important: - Good quality heating data is vital - Timeframe: - Ensure that scenarios are in line with long-term targets - Differentiate between socio-economic and business economic prices: - Taxation, subsidies, externalities etc. influence the result. Use costs that are relevant to society and not supporting status quo. - Important to remember that strategic heat planning is not business as usual
- 17. 3. Enabling Framework Conditions, Financing and Business Models Ownership structure Interests and monopoly Who owns the distribution infrastructure? Pricing What heat pricing mechanisms are being used? Regulation Is there specific district heating regulation? Financing Is it possible to ensure a long timeframe for the return on investment? District Heating Governance Ownership Pricing Regulation Financing
- 18. 3. Enabling Framework Conditions, Financing and Business Models Three typical barriers: Challenge 1: Level playing field Recommendations: • Fiscal levers • Specific district heating legislation • Consider district heating grids as infrastructure • Consider externalities: decarbonisation, supply security, air quality Challenge 2: Lack of governance tools to implement district heating Recommendations: • Feed back needs and ideas to national authorities and legislature. Create awareness of lacking tools. • Identify what is possible within current regulatory framework Challenge 3: Overcoming barriers to investment Recommendations: • Picking low-hanging fruits: start with high-demand consumers, • Government intervention through economic and financial instrument • Capacity building for authorities and heat market stakeholders
- 19. Case study - Zhengzhou Municipality Zhengzhou Municipality included urban planners, architects, construction contractor, future building owners (mainly financial companies), distributor company and the heat supplier (water treatment factory) for planning new district heating systems Zhengzhou Scope and purpose: 1. Replace all coal-fired energy production 2. Increase energy efficiency in buildings by 15% 3. Reduce air pollution levels Framework and financing: Public endowment fund – to recirculate funds for new district heating investments Technical scenarios: - Interaction with buildings to achieve energy savings - Use the wastewater heat
- 20. Key success factors in a Strategic Planning Process 1. Scope and purpose - Identify main stakeholders - Identify drivers for district heating projects 2. Technical scenarios - Measure heat demand - Identify potential heat sources - Balance heat savings and supply - Establish scenarios 3. Evaluate Framework conditions and business models - Ownership - Financing - Pricing - Regulation More on these topics in the next webinars
- 21. Strategic heat planning and the integration of low-temperature renewable energy sources in DHC Strategic Heat Planning is an iterative, multidisciplinary and continuous process Scope and purpose Technical scenarios Framework conditions and business models Key Success Factors: Scope and purpose - Identify main stakeholders - Identify drivers for district heating projects Technical scenarios - Measure heat demand - Identify potential heat sources - Balance heat savings and supply - Establish scenarios Evaluate Framework conditions and business models - Ownership - Financing - Pricing - Regulation
- 22. Further Heating and Cooling Planning Ressources Heat Roadmap Europe studies: link - Heat Roadmap Scenarios for 14 European countries: link - Heating and cooling demands: link - Interactive heat demand and ressource map: link HotMaps Research Project: link - HotMaps toolbox (still under development – more features to be added): link - HotMaps report: Definition & Experiences of Strategic Heat Planning: link - HotMaps report: Guidance for the comprehensive assessment of efficient heating and cooling: link - HOW TO FINANCE GEOTHERMAL DISTRICT HEATING? SEMINAR, BRUSSELS 13 DECEMBER: link - WEBINAR: HEATING AND COOLING PLANNING MADE EASIER: link Other heat planning research projects: - THERMOS – district heating network planning tool: link - ReUseHeat – exploiting urban excess heat: link - KeepWarm – Renewing district heating: link - IRENA & AAU – Guidebook: Facilitating the integration of low-temperature renewable energy in district heating and cooling – Soon published
- 23. Thank you for your attention! Contact: Nis Bertelsen nis@plan.aau.dk www.linkedin.com/in/nisbertelsen
Notas do Editor
- Heating is the largest end-use in Europe Heating accounts for around 50% of total energy consumption High potential for energy savings and district heating. In Europe around 50% district heating and 30% heat savings District heating allows access to many supply sources Geothermal ressources, large-scale heat pumps, excess heat, solar thermal Thermal storage Smart energy systems (sector coupling) District energy can contribute to the transition towards an energy system that integrates smart electric, thermal, gas grids and larger amounts of fluctuating renewable resources
- The policy scale – several interest and needs must be aligned. Local/strategic heat planning is carried out in the context of regulation ”from above” The energy system – important to avoid suboptimisation or over use of certain ressources. Therefore SEP must take the broader energy system into context – both to exploit synergies but also avoid suboptimisation
- IRENA have a comment on the graph
- Challenge 1: Difficulties in governance due to different stakeholders with divergent objectives and functions solution/tools to challenges 1: Identify the stakeholders and their interest in a project, identification of a suitable stakeholder to lead the heat planning process who in most cases is the local authority. case study (if applicable): Zhengzhou Municipality Challenge 2: Resistance from communities due to perceived environmental and social risks of RE technologies e.g. induced micro-seismicity with geothermal solution/tools to challenges 2 -): promoting transparency and raising awareness on benefits of geothermal technologies, harmonizing methodologies for assessing geothermal environmental impact as well as environmental legislation/database for geothermal environmental impact assessments and mitigation measure as being implemented by the GEOENVI project to enhance transparency in geothermal development and create awareness about the risks an
- Challenge 1: Difficulties in governance due to different stakeholders with divergent objectives and functions solution/tools to challenges 1: Identify the stakeholders and their interest in a project, identification of a suitable stakeholder to lead the heat planning process who in most cases is the local authority. case study (if applicable): Zhengzhou Municipality Challenge 2: Resistance from communities due to perceived environmental and social risks of RE technologies e.g. induced micro-seismicity with geothermal solution/tools to challenges 2 -): promoting transparency and raising awareness on benefits of geothermal technologies, harmonizing methodologies for assessing geothermal environmental impact as well as environmental legislation/database for geothermal environmental impact assessments and mitigation measure as being implemented by the GEOENVI project to enhance transparency in geothermal development and create awareness about the risks an
- Technical heat mapping Quantify and locate heat demand Quantify and locate heat resources Quantify and assess heat-saving potentials Establish scenarios for heat supply Challenge 1: establishing the demand for heating requires the acquisition of data on energy consumption from buildings as well as the dynamics of the demand e.g. how demand changes over time. This data is not readily available, especially in relation to space heating and cooling. Solution/tools to challenges 1 – Expand energy metering and measurement to gain knowledge of energy demand, mapping of current building stock to enable estimations of potential energy savings and feasibility of low-temperature supply, modelling or estimating the heat demand using available tools /PETA 4 and Hotmaps toolbox
- Technical heat mapping Quantify and locate heat demand Quantify and locate heat resources Quantify and assess heat-saving potentials Establish scenarios for heat supply Challenge 1: establishing the demand for heating requires the acquisition of data on energy consumption from buildings as well as the dynamics of the demand e.g. how demand changes over time. This data is not readily available, especially in relation to space heating and cooling. Solution/tools to challenges 1 – Expand energy metering and measurement to gain knowledge of energy demand, mapping of current building stock to enable estimations of potential energy savings and feasibility of low-temperature supply, modelling or estimating the heat demand using available tools /PETA 4 and Hotmaps toolbox
- Budapest, Hungary
- The Energy efficiency first principle Assess the costs of different energy-saving measures and implement the ones that are cheaper than the cost of energy supply. Energy efficiency measures have a supply chain effect Building renovation measures usually implemented with very long time frames, thus not always feasible to postpone a district energy project until certain energy efficiency potentials have been realised.
- Existing district heating system New network supplying an existing neighbourhood Adapting existing building stock to low-temperature supply (heating system and DHW preparation system) Design the network to decrease return temperature New urban areas High-efficient buildings prepared for low-temperature Design the network to operate with low-temperature
- Existing district heating system New network supplying an existing neighbourhood Adapting existing building stock to low-temperature supply (heating system and DHW preparation system) Design the network to decrease return temperature New urban areas High-efficient buildings prepared for low-temperature Design the network to operate with low-temperature
- Ownership structure Challenge: Interests and monopoly Public or private? Who owns the grid? Who owns the production Recommendations/solutions Identify where competition can be introduced Production through tenders Publicly-owned infrastructure Pricing Challenge: How to ensure competitive prices in heat market? Recommendations/solutions True costs Price cap No price regulation Challenge 1: Off-take motivation of the consumers Solutions/tools to challenge 1: Selection of the ownership model Price regulation Price regulation Challenge 2: Ensuring a level playing field Solutions/tools to challenge 2: Developing specific district heating legislation Dealing with major externalities such as clean air, decarbonisation, supply security… For geothermal: developing geothermal licensing regimes
- JINAN In recent years, China has attached great importance to clean heating and has introduced a series of policies to promote, support and accelerate the promotion of clean heating. Jinan, as one of the national pilot cities of "winter clean heating", has received ¥700 million of special financial support from the central government annually, or ¥2.1 billion for 3 years in total. Under the impetus of the national clean heating policy, Jinan has formulated a relatively perfect clean heating policy system by 2020. The development of district energy in Jinan is inseparable from the promotion of policies. BELGRADECase study: the City of Belgrade created Energy efficiency Fund as a financing pool for buildings renovation and district heating. Public buildings are scheduled first as demo projects. Capacity building for the municipality and involved stakeholders. Belgrade formed an Energy Efficiency Fund for renovation of public and residential building, but also in order to expand their district heating network. With high levels of energy demand savings on the building side through renovation, it can become more cost-effective to pursue sustainable energy supply options, like district energy based on renewable energy or excess heat, for the remaining energy demand. This means the opportunity to expand the district heating network without increasing installed heat capacity.
- IRENA have a comment on the graph