Geographical distribution of heat savings in a smart energy system

In the transition towards 100% renewable energy systems, most research points to the importance of including energy savings to reach the most cost-efficient solutions. The building sector is a key target of energy savings, the reason being that in many countries, heating account for one third of the national energy demand. To reach the most cost-efficient future energy system, it is important to find the right balance between the cost for heat savings and the cost of heat production. The variation in building quality offer different potentials for savings in buildings, where different types of saving measures have different cost rates, resulting in some being cheaper than others. In future smart energy systems, where district heating will play an important role, the introduction of large amounts of renewables and utilization of waste heat in the district heating, result in potential inexpensive heat supply cost, while the more flexible units like combined power plants and boilers will be more expensive.
The balance between heat savings and heat production have been identified in several papers on an overall national level, however, what becomes apparent is that there is a geographical aspect that needs to be taken into account. The building mass is very different in urban areas with high-density population, apartment buildings, and offices, compared to rural areas and small villages. These differences also show up in the building quality, where some areas consists of new buildings while others predominantly consist of houses that are more than 50 years old. Furthermore, the heat supply costs also differs based on the geographical location of the buildings. In a smart energy system, urban housing in densely populated areas will be supplied by district heating, while heat pumps or biomass boilers will supply houses with individual heating. The geographic difference in heat supply and building types will affect the level at which energy savings will be economically feasible.
This study investigates how the geographical differences in heat supply and building types in a smart energy system influence the economic feasibility of investments in heat savings. This economic feasibility is found by using energy system analysis to identify marginal production costs, and combining it with a geographical assessment of building types and heat demands to identify the different saving profiles for different areas. Together, this delivers a geographical assessment of saving potentials, where the economically feasible balance between costs and savings is identified. The study specifically applies the method to the case of Aalborg Municipality and the plan for a Smart Energy Aalborg in 2050. Furthermore, the analysis examines the socio-economically best solutions, compares these to the current tariff structures and identifies if the structures helps to achieve the required energy savings for 2050.