Generally, there are no specific DH laws or acts in EU countries, while the Central and Eastern European countries surveyed have developed specific DH or heat legislation. CHP and district heating and cooling (DHC) are promoted through fiscal incentives in some EU Member States, while in others legislative support measures are preferred. The CEE countries are strongly encouraging the expansion of CHP. Renewables are also promoted through regulatory/legislative measures in the EU, as well as in CEE countries.
The CHP/DHC industry is generally recognized as an effective instrument to increase security of energy supply and improve the global environment.
In the EU, district heating prices remained relatively stable (in comparison with 1999) despite fluctuations in oil and gas prices. In CEE countries they increased, due to the removal of subsidies, in view of adapting to the Acquis Communautaire (European law). In most CEE countries DH prices are still significantly lower than in EU Member States, but in a few CEE countries (Czech Republic, Hungary, Lithuania) they are approaching the same level.
TRENDS IN THE DISTRICT HEATING AND COOLING SECTOR
District heating is most prevalent in the Central, Eastern and Northern European countries. Climatic conditions here, with long cold winters, are reflected in the higher number of heating degree days (>3000). Historically, this has represented the rationale for the development of DH in the residential sector. However, DH is also used in Southern EU countries, especially in Italy and France.
Figure 1 provides an overview of production and market shares for the residential sector in EU Member States and CEE countries, as well as European Free Trade Association (EFTA) countries surveyed.
The country with the highest production in absolute terms is Germany (88,000 GWh/year). Among the Acceding countries, the Czech Republic (41,000 GWh/year) is an important actor.
Figure 3. Fuels used for CHP/DH in surveyed EU Member States
The market share of district heating in the surveyed EU Member States varies from 1% in the UK, up to 50% in Finland.
In the surveyed CEE countries the market shares vary from 12% in Croatia up to 70% for the residential sector in Latvia. DH therefore represents a major component of the energy sector in the region.
Government sets targets for 2010
As Japan continues to either deregulate or decentralize sectors of its economy, major opportunities for cogeneration and on-site power are beginning to emerge. A combination of policies related to power sector deregulation, climate change mitigation and pollution control in the form of waste recycling, means that up to 20,000 MW of new decentralized energy (DE) capacity could be installed by 2010
– reports Tim Sharp.
Opportunities for decentralized energy (DE), however, face possibly severe constraints. First, as the policy cluster just mentioned suggests, decentralized energy is not yet a policy focus in its own right. Its development could therefore be affected by entirely extraneous considerations. Second, such considerations could easily take effect as powerful vested interests fiercely resist the changes the policies are promoting.
A particular difficulty is that Japan must achieve maximum energy security at minimum economic cost almost entirely from imports, a dilemma that provides opponents to change with their most powerful ammunition. From this perspective, prospects for Japanese DE growth therefore face over the foreseeable future a definite and perhaps quite low ceiling.
A 100 kW phosphoric acid fuel cell running on hydrogen produced from biogas, itself produced from 6 tonnes per day of kitchen waste which was sourced from hotels around Kobe City.
The general context to the developments that will hopefully foster DE is that Japan’s energy dilemma has combined with its post- World War II growth path to produce an optimum fuel mix for power generation that currently emphasizes nuclear energy, coal, natural gas (as LNG), hydro and oil in that order. In terms of market share, the renewables are hardly in consideration.
RIGID ELECTRICITY SUPPLY STRUCTURE
The relative ‘DE-unfriendliness’ of this mix has until very recently been strongly reinforced by an extremely rigid electricity supply industry structure in which 10 regional, vertically integrated power monopolies completely dominate their own areas while also, through the national Federation of Electric Power Companies (FEPC) to which they all belong, exerting immense influence on central government.