Importance of the demand-supply balance in district heating systems

Doctoral thesis, 2020

In line with global efforts directed against climate change, the building sector will have to undergo significant changes in terms of its energy use, along with the transformation of the energy system. The scope of this thesis is limited to the energy supply and demand within district heating (DH) systems, with the emphasis on the space heating demand in buildings. The overall aim is to improve our understanding of how the demand-supply balance can be maintained in the future.

This work applies a techno-economic optimization model that was developed to study optimal dispatch and utilization strategies for DH systems, including endogenous calculation of the space heating demand in buildings, thereby enabling a feedback mechanism between demand and supply. The present work uses the building stock and DH system of Gothenburg, Sweden as a case study, although generalizable insights are derived.

The results suggest that the lowest system cost for transforming urban heating systems is obtained through a combination of investments in energy conservation measures (ECMs) in buildings and in heat generation/storage technologies in DH systems. As expected, the application of energy demand reduction targets results in greater investments in ECMs than would result from considering only developments due to fuel and electricity price increases (without targets) and, thus, the consequences of lower investments in heat generation capacities in DH systems. We also show that the realized demand response (DR) in buildings significantly influences the total system heating load of a DH system through smoothening load fluctuations. DR implemented via indoor temperature deviations of as little as +1°C can effectively smoothen short-term (daily) system load fluctuations by up to 18% and can reduce the total system running cost by up to 4% over a period of 1 year. The cost reduction stems from increased output from base-load generation units and significantly less-frequent use of peaking units. However, for load variation management on longer time scales, the application of centralized thermal energy storage systems is more beneficial than the DR from buildings. Finally, the results reveal the synergy between DH systems and the power sector, in that flexible utilization of Combined Heat and Power plants and heat pumps supplemented with the energy storage potential of DH systems delivers additional economic benefits to DH systems owners and is a reliable service provider to the electric power system.