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Modelling the impact of policy instruments on district heating operations: experiences from Sweden
Linköping University, Department of Management and Engineering, Energy Systems. Linköping University, The Institute of Technology.
Linköping University, Department of Management and Engineering, Energy Systems. Linköping University, The Institute of Technology.
Linköping University, Department of Management and Engineering, Energy Systems. Linköping University, The Institute of Technology.
Linköping University, Department of Management and Engineering, Energy Systems. Linköping University, The Institute of Technology.
2006 (English)In: 10th International Symposium on District Heating and Cooling, Hanover, Germany, 2006Conference paper, Published paper (Refereed)
Abstract [en]

Emission allowances aim at reducing carbon dioxide emissions in the European Union. Feed-in tariffs and green certificates increase renewable electricity generation in some countries. Undesired energy carriers, such as fossil fuels, can be taxed to decrease consumption. In Sweden, monetary policy instruments have been used for many years, which has influenced district-heating utilities’ operations and investments.

The energy system optimisation model MODEST may help elucidating the impact of policy instruments on choices of fuels and plants. The model can minimise operation and investment costs for satisfying district heating demand, considering revenues from electricity sales and waste reception. It has been used to analyse heat and electricity production for 50 local Swedish utilities. This paper shows how some plants, systems and policy instruments have been modelled and results from some case studies. It may help analysts who face policy instruments, which probably will have a growing influence on district heating operations.

Policy instruments should reflect external costs and induce behaviour that is beneficial from an overall viewpoint. Swedish fossil-fuel taxes hampered cogeneration during many years. Earlier, fuel input could be freely allocated to output energy forms and wood was often used for heat production and coal for electricity generation to minimise taxes. Now, lower taxes promote fossil cogeneration but green certificates make it more profitable to invest in renewable electricity generation.

Carbon dioxide emission allowances can reduce local emissions due to districtheating and electricity production significantly at current price levels but the impact depends on allowance price. With emission trading, investment in a natural-gas-fired cogeneration plant may be beneficial for some utilities due to high electricity prices in the European electricity market, partly caused by emission allowances.

District-heating demand can enable utilisation of resources that otherwise would be of no value. A landfill ban now increases waste incineration, which may reduce industrial waste heat utilisation and heat disposal from cogeneration plants and thereby decrease electricity production. A tax on incinerated waste may reduce the profitability of investing in waste incineration.

Place, publisher, year, edition, pages
2006.
Keyword [en]
Energy policy, taxes, green certificates, emission allowances, CHP
National Category
Engineering and Technology
Identifiers
URN: urn:nbn:se:liu:diva-14204OAI: oai:DiVA.org:liu-14204DiVA: diva2:22891
Available from: 2007-01-04 Created: 2007-01-04 Last updated: 2009-05-18Bibliographically approved
In thesis
1. Efficient heat supply and use from an energy-system and climate perspective
Open this publication in new window or tab >>Efficient heat supply and use from an energy-system and climate perspective
2009 (English)Doctoral thesis, comprehensive summary (Other academic)
Abstract [en]

The aim of this thesis is to illustrate whether the heat demand in district heating systems can be seen as a resource that enables efficient energy utilization, how this can be achieved and to discuss consequences of this assumption. Based on the answers to posed research questions and on the studies included in this thesis, it is concluded that the hypothesis “A common system approach for energy supply and heat demand will show climate and economic efficient solutions” is true.

In cold-climate countries, energy for heating of buildings is essential and heating options that interplay with the power system through electricity use or generation have potential for efficiency improvements. In Sweden, district heating is used extensively, especially in large buildings but to a growing extent also for small houses. Some industrial heat loads and absorption cooling can complement space heating demand so that the production resources may be more evenly utilised during the seasons of the year.

Rising electricity prices in recent years cause problems for the extensive use of electric heating in Sweden and further switching to district heating should be a possible option. To be economically favourable, district-heating systems require a certain heat load density. New low-energy houses and energy-efficiency measures in existing buildings decrease the heat demand in buildings and, thus, in district heating systems. Optimisation models have been used in several studies of large, complex energy systems. Such models allow scenarios with changing policy instruments and changed consumer behaviour to be analysed. Energy efficiency measures as well as good conditions for efficient electricity generation, which can replace old, inefficient plants, are needed to reduce carbon dioxide emissions from the energy sector.

Results when having a European energy perspective to studies of changes in Sweden differ from when having for example a Swedish energy system perspective The effects on global carbon dioxide emissions, when studying combined heat and power electricity generation in Sweden, are greater than it is on local emissions.

Abstract [sv]

Eftersom höjda elpriser under senare år orsakar problem för den stora användningen av elvärme, kommer ytterligare konvertering till fjärrvärme att vara ett möjligt alternativ. För att vara ekonomiskt fördelaktigt kräver fjärrvärme en viss värmetäthet. Nya lågenergihus och energieffektiviseringsåtgärder i befintliga byggnader minskar värmebehovet i byggnaderna och då även i fjärrvärmesystemen.Syftet med denna avhandling är att visa om värmebehovet i fjärrvärmesystem kan betraktas som en resurs som möjliggör ett effektivt energiutnyttjande, hur detta i så fall kan uppnås och att diskutera följderna av att göra ett sådant antagande. Baserat på svaren på ställda forskningsfrågor och studier som genomförts har hypotesen som lyder; En gemensam systemsyn för både tillförsel och användning av energi för uppvärmningsändamål leder till ekonomiskt såväl som ur klimatsynpunkt effektiva lösningar, visat sig stämma.

I länder med kallt klimat är energi för uppvärmning av byggnader viktigt och uppvärmningsalternativ som samverkar med elsystemet genom elanvändning eller elproduktion har potential för effektivitetsförbättringar. I Sverige är fjärrvärmeanvändningen utbredd, speciellt i större byggnader men användningen ökar också i småhus. Vissa industriella värmelaster och absorptionskyla kan fungera som komplement till andra värmebehov i fjärrvärmesystem så att produktionsresurser kan användas mer jämnt fördelat över året.

Optimeringsmodeller har använts i flera studier för stora, komplexa energisystem. I dessa kan scenarier med olika styrmedel och förändrad energianvändning analyseras. Nya användningsområden för spillvärme, som att använda värme till absorptionskyla och att växla från olja och el till fjärrvärme i industriella processer kan också studeras. Energieffektiviseringsåtgärder såväl som bra förutsättningar för effektiv elproduktion, som kan ersätta gamla ineffektiva anläggningar behövs för att minska koldioxidutsläppen från energisektorn.

Resultaten då ett europeiskt energisystemperspektiv använts, för att studera förändringar i Sverige, skiljer sig från när endast ett svenskt systemperspektiv använts. Påverkan på globala koldioxidutsläpp, då elproduktion från kraftvärme i Sverige studeras, är större än vad påverkan på lokala utsläpp är.

Place, publisher, year, edition, pages
Linköping: Linköping University Electronic Press, 2009. 72 p.
Series
Linköping Studies in Science and Technology. Dissertations, ISSN 0345-7524 ; 1242
National Category
Engineering and Technology
Identifiers
urn:nbn:se:liu:diva-17219 (URN)978-91-7393-694-1 (ISBN)
Public defence
2009-03-06, A35, hus A,, Campus Vall, Linköpings universitet, Linköping, 10:15 (English)
Opponent
Supervisors
Available from: 2009-03-11 Created: 2009-03-11 Last updated: 2009-03-11Bibliographically approved
2. A System Perspective on District Heating and Waste Incineration
Open this publication in new window or tab >>A System Perspective on District Heating and Waste Incineration
2006 (English)Doctoral thesis, comprehensive summary (Other academic)
Abstract [en]

Energy recovery by waste incineration has a double function as waste treatment method and supplier of electricity and/or heat, thereby linking the systems of energy and waste management. Both systems are undergoing great changes, mainly due to new regulations. Important regulations within waste management in Sweden are a ban on landfill of combustible waste and organic waste, and a tax on landfill of waste. New waste incineration facilities are being built in order to increase capacity to meet these demands.

The aim of this thesis is to investigate impacts on Swedish district heating systems of increased use of waste as a fuel in economic and environmental terms, the latter mainly by assessing emissions of carbon dioxide. Of importance is the influence of various policy instruments. To highlight the connection between the energy and waste management systems and how these influence each other is another goal, as well as the function of district heating systems as user of various waste heat supplies. An important assumption for this thesis is a deregulated European electricity market, where the marginal power production in the short term is coal condensing power and in the long term natural gas based power, that affects the conditions for combined heat and power in district heating systems. The method used is case studies of three Swedish municipalities that utilise waste in their district heating systems. In two papers, the scope is broadened from the energy utility perspective by comparing the energy efficiency of energy recovery and material recovery of various fractions, and the effect of including external costs for CO2 as well as SO2, NOx and particles. The ambition is that the results can be part of the decision making process for energy utilities and for policy makers in the energy sector and waste management.

It is economically advantageous to use waste as a fuel in the energy sector and regulations in the waste management sector and high taxes on fossil fuels contribute to profitability. Waste incineration plants are base suppliers of heat because they derive revenue from receiving the waste. Economic conditions for waste incineration are altered with the introduction of a tax on incinerated municipal waste. A conflict may arise between combined heat and power production in district heating systems and waste incineration, since the latter can remove the heat sink for other combined heat and power plants with higher efficiencies. Combined heat and power is the main measure to decrease carbon dioxide emissions in district heating systems on the assumption that locally produced electricity replaces electricity in coal condensing plants. It can be difficult to design policy instruments for waste incineration due to some conflicting goals for waste management and energy systems. Comparing the energy efficiency of material recovery and energy recovery is a way to assess the resource efficiency of waste treatment methods. From that perspective, if there is a district heating system which can utilise the heat, biodegradable waste and cardboard should be energy recovered and plastics and paper material recovered. To put costs on environmental effects, so called external costs, is a way to take these effects into regard in traditional economic calculations, but the method has drawbacks, e.g. the limited range of environmental effects included and uncertainties in the monetary valuation of environmental effects.

Place, publisher, year, edition, pages
Institutionen för konstruktions- och produktionsteknik, 2006
Series
Linköping Studies in Science and Technology. Dissertations, ISSN 0345-7524 ; 1053
Keyword
Energy recovery, District heating, Waste incineration, Waste management, Environmental, Material recovery
National Category
Engineering and Technology
Identifiers
urn:nbn:se:liu:diva-7992 (URN)91-85643-61-0 (ISBN)
Public defence
2006-11-17, C3, Hus C, Campus Valla, Linköpings universitet, Linköping, 10:15 (English)
Opponent
Supervisors
Available from: 2007-01-04 Created: 2007-01-04 Last updated: 2009-02-26

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Link to Ph.D. Thesis (Kristina Holmgren) Link to Ph.D. Thesis (Maria Danestig)

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Henning, DagDanestig, MariaHolmgren, KristinaGebremedhin, Alemayehu

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