Heating market Sweden

37th Euroheat & Power congress Tallin, 2015-02-27

John.Johnsson@profu.se+46 705 64 28 20

Heating market Sweden

• 1970: ~ 90 % fossil fuels

• Today: more than 80% renewables and recoveredheat, district heating dominating (>50%)

37

27

23

7 5

Heat demand, 2012, [100 TWh]

Singel family houses

Multi family houses

Premises

Industry, conv heating

Weekend cottages

Yearly economic turnover

District heating

Electricity

Biomass

Oil

Other100 billion SEK =11 billion €

Even if district heating is the dominating supplytechnology (>50%), from a economical perspective themarket is dominated by electricity!

How did we get here

• Yesterday: Local environmental problems=> local engagement => local restrictions=> national legislations (policy instruments)

• Yesterday. “One problem measures”, e.g. low sulphur oil

• Today. Combined measures, e.g. district heating with coupled production and waste incineration

• Today. Market competition under a political framework:

– Taxes and other policy instruments, building regulations, customer references, …

On the path towards a sustainable heating system…

• Production:– District heating

• Biomass• Recovered heat• Waste incineration• Coupled electricity and heat production

– Heat pumps• High efficiency heat pumps

– Biopellets

• Improved efficiency reduces the useful energy demand:– 0,5 - 1,0 [% / year]– Very energy efficient new buildings

What will happen in the future?- District heating

• Stagnating /decreasing deliveries – at what pace?

• Increasing competition in all segments!

• Increasing demand for environmental friendly solutions, resource effectiveness and total energy solutions!

• Regulations and policy instruments?

• Confidence from customers?

Increasing heating efficiency- Specific useful energy demand

0

20

40

60

80

100

120

140

160

180

1995 2000 2005 2010 2020 2030 2040 2050

[kWh/m2]

Single family houses trend 1995-2010:

-0,1% per year

Multifamliy housestrend 1995-2010-0,6% per year

Commercial & public buildingstrend 1995-2010-0,9% per year

Average demand,depending of scenario

0

20

40

60

80

100

120

140

10 perc. 90 perc. Low Medium High

District heating Heat pump (ground)

Capital

Energy

Elc. Net

Totalt

Tota

l co

st,i

nk.

VA

T

The competition-Low investment-High heat factor-Low disc. factor- Low elc. price

With the present level of policy instruments, the customer could always,through the assumptions, motivate a heat pump

-High investment-Low heat factor-High disc. factor-High elc. price

2014

0

50

100

150

200

250

300

350

400

0

10

20

30

40

50

60

70

1980 1982 1984 1986 1988 1990 1992 1994 1996 1998 2000 2002 2004 2006 2008 2010 2012

[TWh]

Biomass

Other renewables

Recovered heat

Waste

Heat pumps

Electricity

Peat

Coal

Natural gas

Oil

CO2

[CO2 g/kWh,del]

Environmental and resources effectiveness- District heating

Less fossil fuels and more of biomass, waste and recovered energy- Will that make the customers satisfied?

The answers from district heating

• The customers in focus

• Be the number one alternative for the environment

• Increased internal economic efficiency

• Strive towards local, national and international regulations that take the system consequences into consideration

• Always and in all situations explain the possibilities and advantages with district heating in the sustainable society

What could the future look like- Four possible scenarios

Final energy demandSlow development Efficient houses

More individual Combined solutions

Oil + gasBiomassElectricityDistrict heating

Thank you!