OPTiTRANS: Optimised transition towards low-temperature and low-carbon DH systems: IEA DHC Annex XIII Report

The International Energy Agency (IEA) Technology Collaboration Programme (TCP) on District Heating and Cooling (DHC), including Combined Heat and Power (CHP) and its Annex XIII project “Optimised transition towards low-temperature and low-carbon DH systems” (OPTiTRANS), focuses on the practical barriers for developing DH into a low-temperature and a low-carbon system. The approach is aligned with the concept of 4th Generation District Heating (4GDH) and builds direct upon the work carried out during the previous Annex XII and the project “Stepwise transition strategy and impact assessment for future district heating systems” (STEP).

District heating and cooling (DHC) can play a key role in 1) decarbonisation of urban heating and cooling systems as well as 2) supporting the overall development of the low-carbon energy system. The first is accomplished by replacing fossil-based heat supply by the use of renewable, excess and natural heat sources, and by improving the system efficiency; the second by cross-sectoral linkages, providing flexibility through smart use of thermal storages, demand response and heat supply, e.g., CHP plants and heat pumps (HPs). Previous research has confirmed that a transition to efficient, fossil-free and flexible district heating (DH) is an essential tool in meeting the ambitious emission reduction targets needed for avoiding global warming over the 1.5-2 °C limit. A concept of 4th generation district heating (4GDH) encloses the needed elements and can be considered as a useful toolbox for the transition. A key aspect of the 4GDH concept is the lower distribution temperatures enabling the aforementioned new heat sources and the improved efficiency.

Instead of the already-confirmed overall energy system level benefits, the focus of this proposal is on the DH company and DH system level; how to facilitate the transition process in practice and to ensure adequate support for long-term decision making. Discussions with the DH companies and the industry in general have revealed a strong interest in 1) the potential of the building-level actions, 2) new business models and pricing, 3) the potential of new heat sources, 4) managing a system with more complex heat supply and low-distribution temperatures and 5) assessing the uncertainties related to the transition. All this implies that DH requires development on all heat supply, distribution and building levels, supported by linkage to other energy sectors, storage and suitable demand response solutions.

Project work addressing these themes is reported under four specific chapters: long-term modelling for transition towards future low-temperature systems (Chapter 2), operational modelling for low-temperature district heating (Chapter 3), digitalisation of demand side and motivation tariffs (Chapter 4) and building heating system operation (Chapter 5). In addition, the results are analysed from the perspectives of the project partner countries (Belgium, Denmark, Finland and Sweden) and finally generalised and summarised as a future outlook for countries with 1) developed DH systems and 2) the developing DH countries (Chapter 6). The aim of this effort is to enhance the applicability of the project results, also demonstrating what role the operational environment can play in adopting DH technologies, practices and business models.