Local heating concepts for upgrading district heating networks, A real world case study

During the last decade, the CHP-based centralized production has been the dominant concept within the district heating systems. However, new Danish energy policies such as reducing the electricity heating tax challenges this concept. The new regulations has encouraged DH companies to exploit localized heat production by heat pumps and electric boilers to supply the increased demand in new developed areas which required substantial investments in new pipes and other infrastructures. This paper compares these two approaches in details within the framework of a real world case study. In addition, the effect of incorporating storage tanks in both approaches is investigated. For this purpose, an hourly-based database of expected heat demand and marginal heat production costs for the case study region within a sample year is collected. In addition, Capital and Operational costs including tax and tariff rates as well as technical constraints are taken into account. Then using a mixed integer linear programming, different centralized and local production scenarios are compared. The results reveal that incorporating storage tanks reduces total costs substantially in the both approaches. In addition, it is observed that the combination of local productions and storage capability is more attractive than merely upgrading the current DH network.