Heat Roadmap Europe - Democratizising knowledge bottom-up and topdown, Key findings and recommendations for decarbonising H&C Sector

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1 Brian Vad Mathiesen Sustainable Energy Planning Research Group, Aalborg University Heat Roadmap Europe - Democratizising knowledge bottom-up and topdown, Key findings and recommendations for decarbonising H&C Sector European Commission - Converted Action on the Energy Efficiency Directive Workshop Heating and cooling planning how to properly address actual challenges of MSs Bucharest, October 17, 2018 / /

2 The black box of heating vs. other sectors Heating and cooling demand in 2015 in the EU28 by end-use compared to total final energy demand - Large share for All Member States (not just the cold North) - Overall cooling share in general is 10-15% Heating and cooling demand in 2015 in the EU28 by end-use compared to total final energy demand

3 Heating and Cooling Can Have Very High Renewable Energy Penetrations Source: Mapping and analyses of the current and future heating-cooling fuel deployment, 2016

4 An EU Strategy for Heating and Cooling A first attempt a holistic approach to the heating and cooling sectors The first move from only looking at buildings to also looking at buildings as part of the energy system Energy savings, energy efficiency, electricity AND district heating is mentioned in the first line of the Commission s new Vision for Heating and Cooling Synergies by looking a cross sectors is in focus

5 Renewable Energy Share in Heating & Cooling (%) Renewable Energy vs. District Heating Renewable Energy vs. District Heating 70% 60% 50% 40% 30% 20% 10% 0% 0% 20% 40% 60% District Heating Share (%) Austria Bulgaria Cyprus Denmark Finland Germany Hungary Italy Lithuania Malta Poland Romania Slovenia Sweden Belgium Croatia Czech Republic Estonia France Greece Ireland Latvia Luxembourg Netherlands Portugal Slovak Republic Spain United Kingdom

6 Heat synergies map in PETA4 - Netherlands Heat demands: 296 PJ/y Excess heat: 560 PJ/y District heating share: 6% Renewable energy in heating: 3% Not a Technical barrier to improve energy efficiency?

7 Access to More Sustainable Resources: These Can Only Be Used with District Heating Excess heat from Power Plants Industrial Excess Heat Waste Incineration Bio-refinary Excess Heat Synthetic fuel Excess Heat (electrofuels) Large-Scale Solar Thermal Geothermal Large-Scale Heat Pumps (new study out) Large-Scale Electric Boilers

8 Danish District Heating Fuel Mix (%) Resources for Danish District Heating % 90% 80% 70% 60% 50% 40% 30% 20% 10% 0% Geothermal Electricity Solar Bioenergy Waste: Biodegradable Waste: Non-Biodegradable Coal Gas Oil

9 What does the future bring for you? More or less district heating? Net zero emission buildings? Passive houses? Gas-electricity hybrid heat pumps? What types of district heating are fit for the future? Should district heating decrease or increase? Who should own and profit from district heating system?

10 Three focus areas for buildings S T O P B E F O R E P A S S I V E H O U S E S T A N D A R D S

11 Heat Roadmap Europe 1, 2, 3, and 4 Study 1 (2012): will district heating play a role in the decarbonisation of the European energy system? Study 2 (2013): what is the balance between heat savings and heat supply at an EU level? Study 3 (2015, STRATEGO WP2): low-carbon heating and cooling strategies for 5 member states Study 4 ( ): low-carbon heating and cooling strategies for 14 member states

12 Primary Energy Supply (TWh/year) Carbon Dioxide Emissions (X, Mt/year) Energy Efficiency on Both Sides Can Save Similar Levels of Energy & CO Italy Business-As-Usual BAU 2050 Energy Step 1 Savings Efficiency Energy Heat Roadmap Efficiency 2050 on the Demand on the Supply Side Side (i.e. Heat Savings) 0

13 Primary Energy Supply (TWh/year) Carbon Dioxide Emissions (X, Mt/year) Energy Efficiency on Both Sides Can Save Similar Levels of Energy & CO Italy Business-As-Usual BAU 2050 Energy Step 1 Savings Efficiency Energy Heat Roadmap Efficiency 2050 on the Demand on the Supply Side Side (i.e. Heat Savings) 0

14 Energy Balance for the EU27 in 2010 (EJ) There is more excess heat in Europe than all of the heat demand in buildings Non-specified Non-energy use Transport Electricity Heat for Industry 10 Heat for Buildings 0 Primary Energy Supply Final Consumption End Use

15 50% of the heat demand in Europe can be supplied with district heating

16 The Team Behind

17 Our Purpose in HRE4 The overall objective in this HRE project is to provide new capacity and skills for lead-users in the heating and cooling sector, including policymakers, industry, and researchers at local, national, and EU level, by developing the data, tools, methodologies, and results necessary to quantify the impact of implementing more energy efficiency measures on both the demand and supply side of the sector.

18 Target audience to democratize decisions Pinch-grip the problem by: Opening the Black box of the heating sector bringing knowledge bottom-up AND topdown to key stakeholders! Target groups Local and regional authorities Implementation - Local political and technical decision-makers responsible for implementing national energy strategies and legislation General public - With specific interest in energy management and sustainable development Targeted media - With specific interest in energy management and sustainable development Industry/Bank/Exp erts - City utilities, energy agencies, consultancies, heating and cooling manufacturers, energy companies, financial sector Policy-makers - EU level: EU Parliamentarians on the Industry, Research and Energy Committees and European Commission employees from DG Energy, DG Research, DG Regio, others - National level: energy authorities, national energy ministries, national parliamentarians, energy utilities, energy companies Associations - Local networks, EU and national sectorial and technologic networks NGOs - E.g. Friends of the Earth, WWF, European Climate Foundation Academia - Researchers involved with energy planning or heating and cooling research

19 HRE Approach Energy profiling Energy mapping Energy system modelling Integration of sectors to assess impact on whole energy system Mapping energy potentials Energy savings potential Energy systems modelling Holistic scenario development

20 Heat Roadmap Europe Methodology Data and mapping Energy System analyses BAU (References) Building Demand Savings Potential Costs of Making Savings District Heating Potential District Heating Resources Energy System Potential Energy System Resources Heat Roadmap Europe Alternatives Results (PES, CO2, Costs)

21 Today s Heat Demand from Peta 4.2 () London <5% DH Copenhagen >90% DH Heat Demand Densities 2015 Roma <5% DH Bucharest ~75% DH

22 WP2: Pan-European Thermal Atlas: Case Study: Middlesbrough, UK (350,000 People) Heat Demand Suitable for DH 10 PJ/Year Excess Heat 35 PJ/Year 10 km

23 Localised heat markets and heat supply strategies For different geographical or energy system entities (DHS, countries, regions, heat supply clusters, synergy regions etc) Composition of heat demand by density Identification of a continuous cost-supply relationship Possible shares of DH and individual heating Access to renewable energy sources (large scale solar, geothermal, biomass) Basis for energy systems analysis Available in Peta 4.3 online (Fall 2018 at our conference in Aalborg

24 Heat Roadmaps for transitions Decarbonise in line with Paris Agreement Technically possible, socioeconomically feasible Consider local nature of heating and cooling Consider the wider energy system Everywhere Deep energy savings Combine savings and supply ~30-50% demand reduction Urban areas District energy networks High demand density areas Supply ~half of energy demand Rural areas Mainly heat pumps Low demand density areas Remaining ~half of the energy demand

25 Identifying the Balance Between Supply and Savings Savings, Residential. Services and Industry Supply curve includes DH investment (heat density) Excess heat potential in specific areas Fuel and other heat supply costs Where DH not feasible: Heat pumps

26 Balance between savings and supply Reductions in demand do not affect the HP / DH balance and vice versa (DH more robust) Industry and service savings generally feasible Residential savings differ between countries DH feasible in all countries but different levels France: total energy system costs (M /year) Percentage of market share covered by DH Residential sector space heating savings (additional to a 30% reduction already in the Baseline) 0 5% 10% 15% 20% 25% 0% % % % % % % % % % %

27 Austria Belgium Czech Republic Finland France Germany Hungary Italy Netherlands Poland Romania Spain Sweden United Kingdom HRE14 % change in delivered space heating demands from 2015 Recommended development of thermal demands Current policy: 25% reduction in space heating HRE: 30% reduction in space heating Current policy: annual refurbishment rate between 0,7% and 1,0% HRE: annual refurbishment rate at 1,5% to 2%, AND deeper renovations when they occur -50% -45% -40% -35% -30% -25% -20% -15% -10% -5% 0% BL 2050 HRE 2050

28 TWh/Year Development of thermal demands Total of 30% reduction in space and hot water demand More than current EU policy Combining refurbishment and new efficient buildings Cooling demands expected to increase BL 2015 BL 2050/CD 2050 HRE 2050 Space heating Process heating Hot water Space cooling Process cooling

29 Heat pump & district heating shares of heat market Building HPs Increase in share from 1% to about half of the heat market mainly in rural areas DH supply Increase from 12% to cover the other half of the heat market mainly in urban areas Individuel fuel boilers and electric heating for heating should be limited as far as possible All natural gas boilers are phased out

30 % of heat demand supplied by DH Minimum Recommended DH levels of the total heat market pr. country AT BE CZ DE ES FI FR HU IT NL PL RO SE UK HRE 14 Baseline 2015 ꓕꓕ Interval of feasible DH share in HRE 2050 Minimum recommended share of DH in HRE 2050

31 Feasible shares of DH - Hungary

32 Feasible shares of DH - Italy

33 District heat supply Different types of heat start to play a different role CHPs operate to the electricity markets and pair with large heat pumps HPs combined: ~75% Boilers are almost irrelevant The constraints are mostly temporal and geographic 2% 5% 1% 9% 2% District heating source shares in HRE % CHP plants Geothermal 38% Heat pumps Solar thermal Industrial excess Electric boilers Fuel boilers Waste incineration 4% Fuel production heat recovery 25%

34 Indv. heat production, TWh/year Changes in Individual heating 3000 Individual heating production, HRE14 countries BL 2015 CD 2050 HRE 2050 Boilers Electric heating Heat pumps Solar thermal

35 CO2 emissions, Mtonnes/year Energy system effects Energy Efficiency first from two sides Use renewable energy capacity better Flexibility and storage Reducing pressure on the power sector compared to full electrification Much more in peak capacity than in grid BL 2050 CD 2050 HRE 2050 Total Other sectors Non-energy fuels Energy and industry

36 % of space cooling demand supplied by district cooling District Cooling covers 20% of the urban market 8% 7% 6% 5% 4% 3% 2% 1% 0% AT BE CZ DE ES FI FR HU IT NL PL RO SE UK HRE14

37 General scenario trends

38 Annual Cost Breakdown, billion EUR Total energy system costs Reduction of ~70 B /year Increase in investment costs Job creation Reduced energy price fluctuation Decrease in fuel costs Lower dependence on import of fossil fuels No Natural gas for heating 1,400 1,200 1, Conventionally decarbonized 2050 Heat Roadmap Europe Annual investment CO2 Fuel Operation & Maintenance

39 Today s Energy System Resources Conversion Demands Combustion Engines Fuel Storage Power Exchange Mobility Fossil Fuel Power Plants Electricity Electricity Storage Cooling Boilers Heating

40 Smart Energy System ( Resources Conversion Demands Bioenergy Fuels Combustion Engines Fuel Storage Wind etc. Fluctuating Electricity Electrofuels Power Exchange Mobility Flexible Electricity Electric Vehicles Electricity Storage Combined Heat & Power Heat Pump Cooling Thermal Storage research and innovation Solar programme etc. Fluctuating Heat Heating

41 Integrating Wind Power with Thermal Storage (~ 1-3/kWh) is much cheaper than Electricity Storage (~ 125/kWh) Resources Conversion Relocation Exchange and Storage Engines & Motors Demand Fuel Storage Wind etc. Fluctuating Electricity Synthetic Fuel Power Exchange Mobility (Vehicles) Flexible Electricity Electricity Storage Fuels CHP (or Quad) Heat Pump Electric Boiler Cooling Thermal Storage Heating Solar etc. Fluctuating Heat

42 Unit Investment Costs for Energy Storage Electricity Thermal 125/kWh 1/kWh 300/kWh 90/kWh

43 Pump Hydro Storage 175 /kwh (Source: Electricity Energy Storage Technology Options: A White Paper Energy Storage Primer on Applications, Costs, and Benefits. Electric Power Research Institute, 2010) Thermal Storage 1-4 /kwh (Source: Danish Technology Catalogue, 2012) Oil Tank 0.02 /kwh (Source: Dahl KH, Oil tanking Copenhagen A/S, 2013: Oil Storage Tank. 2013) Natural Gas Underground Storage 0.05 /kwh (Source: Current State Of and Issues Concerning Underground Natural Gas Storage. Federal Energy Regulatory Commission, 2004)

44 Price ( /MWh) Thermal Storage 0.16 m3 Thermal Storage /MWh (Private house: 160 liter for DKK) Thermal storage: Price and Size 6200 m3 Thermal Storage 2500 /MWh (Skagen: 6200 m3 for 5.4 mio. DKK) liter 4 m m m3 4 m3 Thermal Storage 40,000 /MWh (Private outdoor: 4000 m3 for 50,000 DKK) 200,000 m3 Thermal Storage 500 /MWh (Vojens: 200,000 m3 for 30 mio. DKK)

45 Why isn t it happening? Heating is complex Heating is local Heating is long term Lack of knowledge Heat savings and district heating have large investment costs Heating is cultural, ownership problems and profit margins

46 We have 28 regulatory experiments in Europe to learn from!

47 Contact: Heat Roadmap Europe: Pan-European Thermal Atlas: /maps Brian Vad Mathiesen Sustainable Energy Planning Research Group, Aalborg University HRE Twitter: YouTube: /Videos.php