HOT|COOL NO.1/2016 "COP21"


Results As previously stated, most of the expansion would be completed and almost 90% of investment would have to be spent by 2030 with the following effects:

The sensitivity calculations document the importance of the CHP Act for the economic viability of the CHP plants and the 70/70 Strategy. As the CHP Act continues (new provisions of the Act were not known at the time of study release), about three-quarters of the defined district heating expansion can still be realized in a cost-effective way. However, if the CHP Act was abolished completely, the 70/70 Strategy would only be effective in exceptional cases, as not only the subsidies for generation, but also the network subsidies would cease to be applicable. In accordance with the State Aid Guidelines, the Federal Government notified the CHP Act; no official response has been received by the European Commission yet. The CHP support may not be put into effect until the Commission has reached a decision. With the 70/70 Strategy and a newCHP Act inmind, the German district heating sector hopes the European Heat Strategy (to be published in spring 2016) to contain similar incentives for district heating at EU level. • The 70/70 Strategy has been released by the Institute for Energy Economics and the Rational Use of Energy (IER) of the University of Stuttgart and by the Fraunhofer Institute for Manufacturing Technology and Advanced Materials (IFAM) • The study can be downloaded from the AGFWwebsite: (in German). For the English version of the study, please contact the author of the article.

28 Mio. t CO2 reduction, with reference to Germany total CO2 reduction: 90 Mio. t. CO2

For the analysis and the assessment of CO2 emission savings resulting from two above-mentioned scenarios, a reference system assumed a mix of 50% oil boilers and 50 % natural gas boilers with an efficiency of 90 % each. Remaining CO2 emissions are lower in the RES scenario due to two factors: a) the positive effect of CHP power generation will decrease due to the exclusive use of fossil fuels in CHP installations and the lower CO2-factor of electricity; b) the increasing use of renewable energy sources in heat- only boilers and the increasing share of district heating generated by heat-only plants in the RES scenario

38,000 km of new pipes, with reference to Germany: more than 120,000 km of pipes

13,000 potential jobs in the energy sector, with reference to Germany: more than 50,000 jobs

The resulting job creation from the development of district heating means 12,000 new jobs by 2030. An additional 1,250 jobs will come from the operation, maintenance and management of the infrastructure. Up to 70 cent out of every Euro paid for district heat remains in the region (compared with 19 cent for natural gas and 6 cent for heating oil). Strategy 70/70 and the new CHP Act Implementing the 70/70 strategy would ensure the achievement of the previous federal government’s goal of a 25 %CHP share in electric power by the year 2030. However, the Federal Govern- ment changed the reference system to which the goal of 25 % of CHP electricity is related: from net electricity production (150 TWh) to the electricity production from thermal power plants only (115 TWh) . The new CHP Act came into force on 1 January 2016 subject to Commission’s decision on state aid provisions (KWKG 2016). Surcharges increased by an additional EUR 0.6 ct/kWh for plants that replace installations running on hard-coal or lignite (certain conditions apply). The maximum volume of financing support (the total sum of CHP surcharges) has been doubled to EUR 1.5 billion per year. Electricity from high-efficient installations with a capacity above 2 MW, running on gas and supplied to the public grid will receive a surcharge of 1,5 ct/kWh. This provision is valid for the maximum of 16,000 full-load hours for the next 4 years.

For further information please contact:

Europe and International AGFW | The Energy Efficiency Association for Heating, Cooling and CHP Stresemannallee 30 60596 Frankfurt/Main, Germany

Phone: +49 69 6304 281 Fax: +49 69 6304 458 Mail:


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