EctogridTM : The competitiveness of a low temperature district heating network in Germany and United Kingdom

Abstract: It is known that the heating and cooling market constitutes a large part of energy market across Europe and that the domestic and non-domestic buildings have together the largest share of energy demand. The aim of the European climate goals is to reduce the use of fossil fuel based systems and the allowance of energy demand. These have been striving reasons to increase efficiency and reduce GHG emissions on energy systems for buildings. The climate goals and regulations mentioned in this study implicates that European countries strives towards renewable sources in the heating sector, and encouraging heating networks with renewable sources. E.ON has developed a new low temperature district heating and cooling system called EctogridTM, a heat network integrated with heat pumps and cooling machines to supply energy. This thesis will thoroughly describe this heating and cooling system, called EctogridTM, and its constitutive components. The aim of this study is to determine whether the energy markets in Germany and United Kingdom are ready for an introduction of EctogridTM, and exploit existing and upcoming obstacles. To determine this, two research questions are answered through literature review, research and a case analysis. The first research question is evaluating the energy market in Europe with a focus on the heating demand in Germany and United Kingdom where fossil fuels are the dominating fuel. Second research question is comparing EctogridTM with a 4th generation district  heating  network, 4GDHn, in costs to evaluate the competitiveness with existing energy systems on the market. It is concluded that obstacles exist, how big they are for EctogridTM differs from country to country. How developed and flexible the infrastructure is, what energy sources and technologies are commonly used for heating purposes, building insulation, energy prices and regulations are factors that more or less variates from country to country and decides the severity of the feasible imposed obstacles. Germany and United Kingdom mostly uses decentralized gas boilers for the building heating demand, people often reasons them to have cheap running cost due to the energy prices. This study shows that that despite the big difference in energy price between gas and electricity for a household, heat pumps with a minimum COP of 3.5 will have lower running costs  than traditional gas boilers. Since EctogridTM uses heat pumps with a COP between 4-5, in optimal conditions, it is quite competitive in running cost to gas boilers. The obstacle here lies in most buildings being old and insufficient insulated for an EctogridTM system and the investment costs often being more expensive compared to gas boilers. Installing a heat pump or a gas boiler shows that the CO2 emissions per kWh of useful heat (kg CO2/kWh) are 0.31 for a gas boiler and 0.16 for an AHP which means a decrease in emissions of around 50% per useful kWh heat. The case study compared 4GDHn with an EctogridTM solution as an energy system. The case study consisted of 3 buildings with a heating and cooling need in a newly built area in Germany and United Kingdom. The study showed that an EctogridTM solution was more expensive for the customers but more profitable for producers when comparisons were made with regards to the current energy prices and estimations. However, a larger area with a much higher energy demand needs to be considered to see the real competitiveness of EctogridTM and electrified solution. A larger cooling demand will benefit EctogridTM  while reducing the profits of a 4GDHn. The uncertainty of the acquired data, since no pilot project exists yet, makes it hard to draw a certain conclusion whether it is a more competitive energy system than a 4GDHn and other current low carbon heating systems.