Simulating conditions for combined heat and power in the Swedish district heating sector

Abstract: The most important issues in the European energy sector today are how to increase competitiveness on the energy markets, reduce both CO2 emissions and dependence on imported fuels. These issues are also important aspects of Swedish energy policy. In Sweden, the district heating (DH) sector has commonly been used to achieve Swedish energy policy goals. However, the ongoing integration and deregulation of the energy markets in Europe now means that the Swedish DH sector can also play an important role in achieving international targets. This thesis investigates the extent to which the Swedish DH sector can contribute to compliance with current energy policy targets, both international and Swedish. The study consisted of simulations of the Swedish DH sector response to various policy instruments in a model that takes the local features of virtually all Swedish DH systems into account. The findings show, for example, that there is great potential for combined heat and power (CHP) generation in the Swedish DH sector. By exporting this CHP electricity to other European countries with less effective and fossil dependent power generation plants, the CO2 emissions from the European energy sector could be substantially reduced. This would also result in increased security of supply and competitiveness in the EU, since fuel use would be more effective. In Sweden, increased CHP generation would also be a way of maintaining an effective national security of supply of power.