A Global Initiative to Unlock the Potential of Energy Efficiency and Renewable Energy

District Energy in Cities: An Integrated Approach to the Energy Transition Nordic Heating and Cooling Workshop, Helsinki. 12th June 2015 Ms. Lily Riahi, DES Initiative, Energy, Climate, and Technology Branch, UNEP

Contents

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Introduction to the Global District Energy in Cities Initiative 1

Sharing Nordic expertise globally through the Initiative

How the Initiative can support Nordic activities in district energy

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3

District energy: key solution to the energy transition

3

Danish CHP and wind development 1985 – 2009

Image: Lauersen, 2014

In order to stay below 2oC we will need district energy to: • improve energy

efficiency • reduce fossil fuel

consumption • achieve 100%

renewables • provide the systems

approach needed

Market barriers are holding back district energy’s potential

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• Cities account for more than 70% of global energy use.

• Waste heat capture. • Huge cooling demand growth. • Refurbishment systems • Integrating and balancing

renewables Barriers Development costs and patient capital

Lack of Capacity and Awareness

Lack of Recognition of

savings and benefits

Comprehensive Policy

Frameworks

Huge potential

Launch of the Global District Energy in Cities Initiative

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Scope of Activities

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5 International Organizations 6 Industry Associations* 8 Private Sector Companies 2 Networks 26 Municipal Governments

Leveraging the Partnership and Pool of Expertise to Provide

Capacity Building & Knowledge Transfer

Best practice sharing. Training workshops.

Heat planning. Local coordination

development

Technical Assistance. City twinning.

Pre feasibility and feasibility studies.

International consultants. Metering equipment.

Demonstrations activities Local planning policies.

Local and national support programmes.

Regulatory framework. Tariff structures

Awareness raising Study tours

Assistance in negotiations. at national

level. Public consultations.

Successful Market Transformation

Launch of Publication: An Address from Achim Steiner

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“In launching this report we want to draw the attention of the world’s decision

makers, mayors and leaders at the community level to the importance of

district energy systems.” - Achim Steiner, UN Environment Programme Executive Director. Launch of the District Energy in Cities Report - Paris, 25 February

2015

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Best practice technologies

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Katri Vala heat pump in Helsinki

Captures 165, 000 Gwh of heat!

Danish expertise and technology showcased by work

of Danfoss in Anshan, China

Best practice city policies

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Multiple business models for varying risk and control

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Best practice national policies

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“In Sweden, a CO2 tax was critical to the country’s energy transition strategy and Gothenburg identified the CO2 tax as the most important national policy for district energy in the city”

UNEP, District Energy in Cities

Best practices: EU Policy on heat planning

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“EU legislation on energy efficiency requires that regional and local authorities plan and design an urban heating and cooling infrastructure that utilizes all available renewable energy sources and CHP in their region.”

UNEP, District Energy in Cities

Nordic best practice featured in multiple case studies

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8 of 36 case studies in the

publication are based on

Nordic best practice.

Developing the Initiative’s methodology for accelerating DES

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Nordic cities represent 8 of 45 champion cities. Best practice from champion cities combined: • Technology and benefits • City policies • Business models • National policies

Methodology and Key Steps

10 Key Steps to developing District Energy

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Decision tree for local and national governments

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What will the Initiative do?

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Methodology and Key Steps

Cities and countries around the world requesting help from the Initiative:

• India • China • Serbia

• Kosovo • Croatia • Morocco

• Bosnia and Herzegovina

• Mongolia

• Philippines • Colombia • Indonesia

• Kenya • Bahamas

Contents

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Introduction to the Global District Energy in Cities Initiative 1

Sharing Nordic expertise globally through the Initiative

How the Initiative can support Nordic activities in district energy

2

3

Realising the Initiative’s full potential

20

Business as Usual

Funded Initiative Activities

Potential Initiative Activities

• New cities without heat/cool planning.

• Abandoned refurbishment systems.

• European best practice not shifting abroad

• DHC mostly confined to Nordics and EE

• 3 pilot cities in India, China and Eastern Europe.

• State/Provincial replication

• Global training and decision tools for local governments

• City-twinning

• Multiple pilot cities builds to national momentum and replication

• New markets emerge for European best practice transfer

• DES becomes status-quo in new city design

• Energy transition

- Initial funding of Initiative - In-kind support from select partners

- More funds to Initiative - European universities, cities and private sector contribute expertise

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China – Heat planning Huge potential impact of renewable energy heating guidelines under the new energy cities programme

• demonstration projects being developed • Nordic expertise and best practice can be transferred • currently includes more than 80 cities but aims at including 100

cities all over China. Will shape heat delivery in China for decades

Initiative actions Test guidelines at the local level using international expertise and local tools developed by Initiative in a demonstration.

Identify barriers and opportunities for integration of renewables. Showcase Nordic/EU-China cooperation in district energy

National policy could benefit from Nordic/EU best practice in heat planning. National replication of best practices and lessons

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China – Macro-economic benefits

Nordic/EU DES approaches require strong analytics to justify replication

Initiative actions Develop socio-economic cost-benefit analysis of Chinese heat policy.

EU expertise huge. EU Heat Planning Legislation requiring cost-benefit analysis

EU Expertise: • Universities • Private sector • Cities • National

governments

Must include: • Impact of heat planning • Renewables integration • Alternative technologies • Air pollution • Mitigation and adaption

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Anshan – Heat planning based on macro-economic benefits

• Heat planning for city: hydraulically separated transmission, pooling networks, waste heat connection, hot water connections and renewables.

• Pollution fines and coal savings between 60-90% leads to macro-economic benefits payback of <2.5 years.

• Heat planning • Renewables integration • Maximising efficiency • Waste heat connection • Stakeholder coordination

Danish experience

Nordic China best practice transfer that is highly replicable approach across province and China

Initiative activities in Eastern Europe

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• Accession and non-accession countries need support with district heating modernisation.

• Initiative provides platform for independent support and could develop systems integrated policies (e.g. CHP FiT)

• Initiative will provide neutral technical assessments and capacity building

• Yerevan, Armenia had CHP FiT inception and PPP but country lacked local capacity

Transfer of expertise and development of local capacity

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Contents

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Introduction to the Global District Energy in Cities Initiative 1

Sharing Nordic expertise globally through the Initiative

How the Initiative can support Nordic activities in district energy

2

3

European perspective

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Finland: Building code and EPBD

Heat Roadmap: Planning for districts

Norway: Licensing of DH

Sweden: Levelling the playing field

European perspective

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Denmark: Connecting energy systems

Germany: Energy-saving ordinance

Germany: CHP FiT and solar PV

Building on European Leadership

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Renewables leadership

Figures: REN21

Transferring European best practise abroad

• Europe retains global leadership in district energy

• Cities, universities, countries, and private sector can share best practice globally

• Global District Energy in Cities Initiative provides platform for accelerating DES

Thank you!

30 unep.org/energy/des

Ms. Lily Riahi - Advisor on Sustainable Energy in Cities United Nations Environment Programme I Energy, Climate, and Technology Branch 15 rue de Milan, 75009 Paris I Tel: + 33 1 44 37 42 92 I Email: Lily.Riahi@unep.org