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Possibilities and consequences of deregulation of the European electricity market for connection of heat sparse areas to district heating systems
University of Gävle, Faculty of Engineering and Sustainable Development, Department of Building, Energy and Environmental Engineering, Energy engineering.
University of Gävle, Faculty of Engineering and Sustainable Development, Department of Building, Energy and Environmental Engineering, Energy engineering.ORCID iD: 0000-0003-3472-4210
2010 (English)In: Applied Energy, ISSN 0306-2619, E-ISSN 1872-9118, Vol. 87, no 7, p. 2401-2410Article in journal (Refereed) Published
Abstract [en]

The objective of the study is to analyse the conditions for connection of residential buildings in heat sparse areas to district heating systems in order to increase electricity production in municipal combined heat and power plants. The European electricity market has been assumed to be fully deregulated. The relation between connection of heat sparse areas, increased electricity and heat production as well as electricity prices, fuel prices and emissions rights is investigated. The results of the study show that there is potential to expand the district heating market to areas with lower heat concentrations in the cities of Gavle, Sandviken and Borlange in Sweden, with both economic and environmental benefits. The expansion provides a substantial heat demand of approximately 181 GWh/year, which results in an electricity power production of approximately 43 GWh/year. Since the detached and stand-alone houses in the studied heat sparse areas have been heated either by oil boiler or by direct electricity, connection to district heating also provides a substantial reduction in emissions of CO(2). The largest reductions in CO(2) emissions are found to be 211 ktonnes/year assuming coal-fired condensing power as marginal electricity production. Connection of heat sparse areas to district heating decrease the system costs and provide a profitability by approximately 22 million EURO/year for the studied municipalities if the price of electricity is at a European level, i.e. 110 EURO/MWh. Sensitivity analysis shows, among other things, that a strong relation exists between the price of electricity and the profitability of connecting heat sparse areas to district heating systems.

Place, publisher, year, edition, pages
2010. Vol. 87, no 7, p. 2401-2410
Keywords [en]
Combined heat and power, Heat sparse areas, CO(2) emissions, District heating, Deregulated electricity market
National Category
Energy Engineering
Identifiers
URN: urn:nbn:se:hig:diva-10271DOI: 10.1016/j.apenergy.2010.02.002ISI: 000278675100034Scopus ID: 2-s2.0-77953157422OAI: oai:DiVA.org:hig-10271DiVA, id: diva2:442543
Available from: 2011-09-21 Created: 2011-09-21 Last updated: 2021-10-04Bibliographically approved
In thesis
1. Economic and Environmental Benefits of CHP-based District Heating Systems in Sweden
Open this publication in new window or tab >>Economic and Environmental Benefits of CHP-based District Heating Systems in Sweden
2013 (English)Doctoral thesis, comprehensive summary (Other academic)
Abstract [en]

Future energy systems and thus the climate are affected by many factors, such as energy resources, energy demand, energy policy and the choice of energy technologies. Energy systems of the future are facing three main challenges; the steady growth of global energy demand, the energy resource depletion, as well as the increasing emissions of carbon dioxide (CO2) and other greenhouse gases and their impact on climate change. To meet the mentioned challenges with sustainability in mind, actions that increase energy efficiency and choosing an energy-efficient energy system which is cost efficient will be essential. Combined heat and power (CHP) plants and district heating and cooling could contribute greatly to increased system efficiency by using energy otherwise wasted.

The aim of this study is to increase the understanding of how CHP-based district heating and cooling systems using different primary energy sources can contribute to more cost-efficient energy systems, which reduce global CO2 emissions, and to highlight the impact of some important parameters and measures on Swedish municipal district heating systems. An important assumption in this study is the estimation of CO2 emissions from electricity production, which is based on marginal electricity perspectives. In the short term, the marginal electricity is assumed to come from coal-fired condensing power plants while in the long term it consists of electricity produced by natural gas-fired combined cycle condensing power plants. This means that the local electricity production will replace the marginal electricity production. The underlying assumption is an ideal fully deregulated European electricity market where trade barriers are removed and there are no restrictions on transfer capacity.

The results show that electricity generation in CHP plants, particularly in higher efficiency combined steam and gas turbine heat and power plants using natural gas, can reduce the global environmental impact of energy usage to a great extent. The results confirm, through the scenarios presented in this study, that waste as a fuel in CHP-based district heating systems is fully utilised since it has the lowest operational costs. The results also show how implementation of a biogas-based CHP plant in a biogas system contributes to an efficient system, as well as lowering both CO2 emissions and system costs. The results show that replacing electricity-driven (e.g. compression) cooling by heat-driven cooling using district heating (e.g. absorption chillers) in a CHP system is a cost-effective and climate friendly technology as electricity consumption is reduced while at the same time the electricity generation will be increased. The results of the study also show that there is potential to expand district heating systems to areas with lower heat density, with both environmental and economic benefits for the district heating companies.

The results reveal that the operation of a studied CHP-based district heating system with an imposed emission limit is very sensitive to the way CO2 emissions are accounted, i.e., local CO2 emissions or emissions from marginal electricity production. The results show how the electricity production increases in the marginal case compared with the local one in order to reduce global CO2 emissions. The results also revealed that not only electricity and fuel prices but also policy instruments are important factors in promoting CHP-based district heating and cooling systems. The use of electricity certificates has a large influence for the introduction of biogas-based cogeneration. Another conclusion from the modelling is that present Swedish policy instruments are strong incentives for cogeneration with similar impact as applying external costs.

Abstract [sv]

Framtidens energisystem och därmed även klimatet påverkas av många faktorer, såsom energitillgångar, efterfrågan på energi, energipolicy och valet  av energitekniska lösningar. De framtida energisystemen står inför tre viktiga utmaningar: den ständigt växande efterfrågan på energi i världen, problemet med minskande energitillgångar samt den ökande koldioxidhalten i atmosfären och utsläppen av andra växthusgaser och deras påverkan på klimatförändring. Det blir alltmer angeläget att möta de nämnda utmaningarna med hållbarhetsbegreppet i åtanke, att agera för att öka energieffektiviteten och att välja ett energieffektivt energisystem som också är kostnadseffektivt. Fjärrvärme och fjärrkyla baserade på kraftvärme (CHP) kan i hög grad bidra till ökad effektivitet genom användning av energi som annars skulle gå till spillo.

Syftet med denna studie är att öka förståelsen för hur CHP-baserad fjärrvärme och fjärrkyla som använder olika energikällor kan bidra till mer kostnadseffektiva energisystem som även ger minskade globala koldioxidutsläpp samt att belysa effekterna av vissa viktiga parametrar för svenska fjärrvärmesystem. Ett viktigt antagande i denna studie är beräkningarna av koldioxidutsläppen från elproduktion som är baserade på marginalelsperspektiv. På kort sikt antas marginalelen komma från koleldade kondenskraftverk, medan den på lång sikt utgörs av el som produceras av naturgas i gaskombi-kondenskraftverk. I beräkningarna antas den lokala elproduktionen ersätta marginalelsproduktionen. Det underliggande antagandet är en ideal, helt avreglerad, europeisk elmarknad där handelshindren är borta och det inte finns några begränsningar i överföringskapaciteten.

Resultaten visar att elproduktion i kraftvärmeverk, speciellt i högeffektiva kraftvärmeverk med en kombination av ång- och gasturbiner med naturgas, kan minska den globala miljöpåverkan av energianvändningen avsevärt. Resultaten bekräftar också, genom de scenarier som presenteras i denna studie, att avfall utnyttjas fullt ut som bränsle i kraftvärmebaserade fjärrvärmesystem eftersom det har de lägsta driftskostnaderna. Resultaten visar också hur införande av ett biogasbaserat kraftvärmeverk i ett biogassystem bidrar till ett effektivt system för att minska koldioxidutsläppen och systemkostnaderna. Resultaten visar att det är kostnadseffektivt och klimatvänligt att byta ut eldrivna kompressorkylmaskiner mot värmedrivna absorptionskylmaskiner i ett CHP-system eftersom elanvändningen minskas och elproduktionen samtidigt kommer att öka. Resultaten av studien visar också att det finns potential att bygga ut fjärrvärmesystem till områden med lägre värmetäthet med både miljövinster och ekonomiska fördelar för fjärrvärmeföretagen.

Resultaten visar att driften av ett studerat CHP-baserat fjärrvärmesystem där olika gränsvärden för utsläpp införs är mycket känsligt för hur koldioxidutsläppen redovisas, d v s som lokala koldioxidutsläpp eller utsläpp från marginalel. Resultatet visar hur elproduktionen ökar i marginalelsfallet jämfört med det lokala fallet för att minska de globala koldioxidutsläppen. Resultaten visade också att inte bara el- och bränslepriserna, utan också styrmedlen är viktiga för att främja kraftvärmebaserad fjärrvärme och fjärrkyla. Elcertifikat har t ex stor inverkan på införandet av biogasbaserad kraftvärme. En annan slutsats från modelleringarna är att de styrmedel som finns i dagens Sverige utgör starka incitament för kraftvärme och har en liknande effekt som att använda externa kostnader.

Place, publisher, year, edition, pages
Linköping: Linköping University Electronic Press, 2013. p. 108
Series
Linköping Studies in Science and Technology. Dissertations, ISSN 0345-7524 ; 1524
National Category
Energy Systems
Identifiers
urn:nbn:se:hig:diva-18915 (URN)978-91-7519-604-6 (ISBN)
Public defence
2013-06-10, C3, C-huset, Campus Valla, 10:15 (English)
Opponent
Supervisors
Available from: 2015-02-04 Created: 2015-02-04 Last updated: 2021-10-04Bibliographically approved

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