12th International Symposium on District Heating and Cooling

The <strong>12th</strong> <strong>International</strong> <strong>Symposium</strong> on District Heating and Cooling,September 5 th to September 7 th , 2010, Tallinn, EstoniaPOLICIES AND BARRIERS FOR DISTRICT HEATING AND COOLINGOUTSIDE EU COUNTRIESA. Nuorkivi 1 and B. Kalkum 21 Energy-AN Consulting2 Energy & Utility ConsultingABSTRACTThe policies and barriers faced by DHC in the countriesoutside the EU will be investigated during 2010–2011as a part of the Annex IX of the IEA ImplementingAgreement on District Heating and Cooling (DHC),including the integration of CHP.The countries to be covered are China, USA, Canada,South Korea, Russia and some other selectedEuropean countries outside the EU. The work is basedon both interviews of the key officers and specialistsand the existing laws, regulations and policies of eachselected country. The project will also provideexamples of best practices useful for sustainabledevelopment of DHC as well as offer recommendationsto the countries to improve the institutional set up of theDHC.Regarding each country, the project will review, forinstance, the tariff setting, DHC related legislation,taxation rules, price regulation, customer definition andpoints of delivery; ownership of fixed assets; allocationof CHP costs and environmental fees; socialconsiderations; municipal heat planning; and, heatmetering and control.The project here is a twin project to EcoHeat4EU that isa thorough analysis of the barriers and opportunities ofDHC as well but in the selected EU member countries.INTRODUCTIONThere is no reliable statistics of DHC in most of thesubject countries. The countries are in different stagesof DHC development, as can be read out in the paper.The market drivers and barriers are different as well.The aim of the study is to identify lessons learned fromall countries, including the EU that might be useful toboost DHC development in the particular subjectcountry. Nevertheless, the lessons learned andrecommendations will be developed in fall 2010, afterthe <strong>Symposium</strong>, and the final and complete study willbe available in May 2011. Therefore, all informationpresented in the paper regarding four countries,Canada, China, Ukraine and USA is based on thepreliminary survey that will be finalized byOctober 2010.PRELIMINARY COUNTRY SPECIFIC SURVEYS1. Canada1.1. Status of DHCThe old DH systems before 1985 are predominantlywith steam, whereas water systems have been builtsince 1985. Both domestic hot water (DHW) and spaceheating (SH) have been included. Based onwater/steam carrier, various combinations of heatingand cooling are available in Canada.Historically, Canada has had the highest per capitaenergy use of the developed countries, as a result ofthe harsh climate and relatively low-cost, abundantenergy. So the benefits of DHC would be particularlywelcome to save energy. In Canada, there are recordsof some 120-160 DHC systems in the country, andalmost a half of them located in Ontario Province alone.About 27 Mm 2 of residential, industrial and institutionalfloor area are connected to the DHC systems. Thisrepresents about 1,3% of all floor space in Canada.The largest DHC system is in Toronto with 522 MWthermal capacity.[1]Natural gas distribution has spread everywhere, whichis a challenge for DHC expansion. Moreover, atrelatively low electricity prices, there is a little marketfor CHP. No economic market for CHP exists inCanada unless the feed-in tariff is in place or theelectricity is used in-house of producer. Power and gasutilities have not been co-operating so far, becausethere has not been any incentive to such co-operation.Because of the structure of the provincial utilities andlow electricity prices, only a few CHP based DHCsystems are in operation.The utilities are empowered to provide the people withgas and electricity at the lowest costs possible.Economic drivers support the selection of the propertechnologies, and the provincial regulators ensure thatthe system availability and safety are maintained at alltimes. Provincial governments provide some directionsto the energy industry, but limit themselves to settingoverall goals only. The selection of the technologies isleft to the utilities. Natural gas is widely availablethroughout the country, which is a challenge for otherheating modes to enter the market. Serious lack of gasreserves is expected in the future, which meansalternative energy sources to become increasingly215