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NETWORK / 12 / FEBRUARY 2017 DISTRICT HEATING Fuel sources The Danish government has steered the production of heat away from fossil fuels such as coal through the use of taxes, rather than the subsidised system used in GB. Since 1990 the use of coal has fallen while biomass has increased rapidly because it is exempt from energy taxes. Many large-scale combined heat and power plants around major cities are being converted to biomass to meet zero carbon targets. There are now 310 biomass-based boilers in Denmark producing 21% of the 63% total DH capacity. But this is just the short-term plan. Long- term the country's renewable energy ambi- tions are expected to feed through into heat as well. Already the country is beginning to see the conversion of excess renewable elec- tricity into heat through heat pumps and electric boilers. This is only set to continue. Using the excess energy will help stabilise the system and provides a form of short- term energy storage by using the DH pipe capacity. In the future solar heating is also expected to take off. Such technologies in the UK are still in their infancy in terms of penetration – solar thermal technology was recently saved from removal from the Renewable Heat Incentive. Doing so would have destroyed the supply chain necessary to form a solar thermal DH industry in the UK in the future. In Denmark, taxes – which represent more than a quarter of the customer's final bill – help control fuel source, but it is also influenced by DERA through regulation. Heat companies can claim only the cost of the cheapest fuel source available to them. This prevents the development of too many competing fuel sources DERA says, and ensures the cleanest is fully utilised first. Incinerated waste is currently prioritised over other fuel sources. Waste companies that sell heat are exempt from the not-for- profit regulation but will be subject to a price cap in two years' time. Incineration is an effective solution to the country's waste problem, and Denmark is so efficient at deal- ing with its waste that alongside Sweden it actually imports waste from other countries – such as the UK – to meet its needs. Com- paratively the UK's waste resource is largely untapped, and is a particular area where the Danish model could provide valuable learn- ing for the development of both a larger DH sector and more integration between differ- ent sectors. Customer protection The lack of DH consumer protection in GB – compared with the regulated gas and elec- tricity industries – has been somewhat alle- viated by the creation of the Heat Trust in 2015. In Denmark, customers such as social housing schemes, which make up 20% of the housing stock in Copenhagen, are pro- tected through its system of regulated neces- sary costs. But there is a further layer of protection for tenants living in those schemes. Tenants are billed on their specific consumption – achieved through submetering using heat cost allocators that are largely unfamiliar to GB customers, or through energy meters. The total annual bill is divided into equal payments taken through the year. If custom- ers disagree with the social housing scheme they can complain to a Complaints Com- mission. This commission consists of three locally selected members who analyse writ- ten complaints and reach a decision. Boligkontoret Danmark, a social hous- ing company with 32,000 rental units, said it received 127 complaints last year of which just six were taken to the commission. In the transition from fixed quotas to individual billing, research has shown that consumption drops by 20% as consum- ers are able to follow their daily energy use online. But unlike in GB, the focus is less on reducing energy consumption and more on better use of heat. The country has a major problem with mould because of its climate, and many consumers do not understand how to correctly heat their homes to pre- vent mould growth. A major focus for social housing companies is in communicating with their tenants, something Boligkontoret says is best done face-to-face. It is difficult to look at such an estab- Backfilling Deposit onto or into land (landfill) Land treatment and release into water bodies Recycling and other recovery Waste split by final treatment method, UK 2014 43.6% 10.4% 23.1% 18.4% 3.6% 0.9% Incineration Energy recovery Source: Defra statistics lished system as district heating in Denmark and imagine the UK could emulate it any significant way. But despite this there are valuable lessons to be learnt. Firstly and most critical is the whole sys- tem approach to energy in Denmark that ensures different sectors such as waste are fully utilised, and cooling is already being considered. This has achieved an overall system efficiency and put Denmark on track for reaching CO2 and fossil fuel reduction goals that the UK could currently not even dream of. But this culture of prioritising the needs of a country as a whole in becoming greener over the needs, and choice, of the individual consumer is at odds with the culture in the UK. Here, energy is a trilemma with price given equal footing alongside carbon reduc- tion. The natural monopoly of a district heating network also does not tally with the changing attitude to traditional monopoly utilities in the UK. The non-domestic water sector in the UK is readying itself for compe- tition, and gas and electricity networks have been warned to expect competition in the not-to-distant future. The Danish example does point to the necessity of regulation for the development of district heating, but the Danish system would likely become unwieldy at the scale necessary here, and even in Denmark ques- tions are starting to be asked about whether heat companies would be better run com- petitively. It may be leaps ahead, but Den- mark is unable to provide all the answers. wOOD OR STRAw 200 Dh PLANTS 45 chP PLANTS bIOGAS 5 Dh PLANTS 32 chP PLANTS mUNIcIPAL SOLID wASTE 6 Dh PLANTS 22 chP PLANTS