Optimal utilisation of heat demand in district heating system-A case study

This paper presents the results of a model study of a district heating system (DHS). As a case study, a local DHS in a town in Sweden has been modelled using a linear programming method. The electricity generation system in northern Europe is also modelled in simplified way to serve as an input. The purpose of this study and modelling in this way is to answer the questions concerning the choice of technology solutions and fuels from an economic and an environmental point of view where the focus is on the local DHS. The main objective is to study the impact of different levels of biomass prices and emission allowances on the choice of fuels and production technologies (no other taxes, fees or any kind of subsidy are considered). The results show that low biomass prices along with high emission costs promote investment in biomass-based cogeneration. However, this would mean that the market price of existing renewable incentives and CO2 cost must be higher than the current level. Furthermore, biomass as it is used now in traditional CHP system is not system optimal. In an integrated system, plants with high electrical efficiency provide better economy and lower emissions of global CO2 than solutions based on traditional biomass CHP. The need for a system solution where the heat demand is used efficiently is seen in facilities with high electrical efficiency.