Perspective on pricing district heating pricing in Sustainable energy systems

Abstract

District heating systems play an important role for increased system efficiency and reduced climate impact. However, the heat market is changing in many ways. Some example of that is that current climate change reduces the heat demand for the buildings, more energy efficient houses are being built, and the competition from other heating actors escalates. Increased knowledge and cooperation with customers is therefore crucial for the district heating industry. Today, several real estate companies are considering replacing installed district heating and instead investing in their own heat pump solutions, which means that the energy utilities are facing reduced demand of heat. In this perspective, it is important to open up for increased cooperation between different energy sources. No energy source alone can fulfil a regions total demand of heat. Increase cooperation between different sectors, and a systems perspective with regard to the region's total energy demand, is therefore crucial to alter the use of energy towards more sustainability. Attractive price models that encourage energy efficiency and lead to reduce system cost must be developed embracing broth users and suppliers for the whole energy system. The aim of this study is to show what measure for energy supplier and energy users that leads to both reduced climate impact as well as reduced system cost for the whole energy system. The study analyses price models for district heating and future heat demand in a region. A system perspective is applied using a back-casting angel with a desirable sustainable vision.