A System Perspective on District Heating and Waste Incineration

Abstract: Energy recovery by waste incineration has a double function as waste treatment method and supplier of electricity and/or heat, thereby linking the systems of energy and waste management. Both systems are undergoing great changes, mainly due to new regulations. Important regulations within waste management in Sweden are a ban on landfill of combustible waste and organic waste, and a tax on landfill of waste. New waste incineration facilities are being built in order to increase capacity to meet these demands.The aim of this thesis is to investigate impacts on Swedish district heating systems of increased use of waste as a fuel in economic and environmental terms, the latter mainly by assessing emissions of carbon dioxide. Of importance is the influence of various policy instruments. To highlight the connection between the energy and waste management systems and how these influence each other is another goal, as well as the function of district heating systems as user of various waste heat supplies. An important assumption for this thesis is a deregulated European electricity market, where the marginal power production in the short term is coal condensing power and in the long term natural gas based power, that affects the conditions for combined heat and power in district heating systems. The method used is case studies of three Swedish municipalities that utilise waste in their district heating systems. In two papers, the scope is broadened from the energy utility perspective by comparing the energy efficiency of energy recovery and material recovery of various fractions, and the effect of including external costs for CO2 as well as SO2, NOx and particles. The ambition is that the results can be part of the decision making process for energy utilities and for policy makers in the energy sector and waste management.It is economically advantageous to use waste as a fuel in the energy sector and regulations in the waste management sector and high taxes on fossil fuels contribute to profitability. Waste incineration plants are base suppliers of heat because they derive revenue from receiving the waste. Economic conditions for waste incineration are altered with the introduction of a tax on incinerated municipal waste. A conflict may arise between combined heat and power production in district heating systems and waste incineration, since the latter can remove the heat sink for other combined heat and power plants with higher efficiencies. Combined heat and power is the main measure to decrease carbon dioxide emissions in district heating systems on the assumption that locally produced electricity replaces electricity in coal condensing plants. It can be difficult to design policy instruments for waste incineration due to some conflicting goals for waste management and energy systems. Comparing the energy efficiency of material recovery and energy recovery is a way to assess the resource efficiency of waste treatment methods. From that perspective, if there is a district heating system which can utilise the heat, biodegradable waste and cardboard should be energy recovered and plastics and paper material recovered. To put costs on environmental effects, so called external costs, is a way to take these effects into regard in traditional economic calculations, but the method has drawbacks, e.g. the limited range of environmental effects included and uncertainties in the monetary valuation of environmental effects.