HOT|COOL NO. 1/2017 - "System Integration"


One of the advantages of the triple tariff system was the financial certainty and incentives it established, causing CHP plants that were decided by and operated by non-specialists to be given a design that was also appropriate for flexibility provision. Also, rather than reflecting the short-term marginal costs of the electricity market, price levels in the triple tariff reflected the long-term marginal value of CHP production. Owners of CHP plants are, however, not sufficiently financially robust to sustain the transition to providing capacity only. A Danish capacity payment scheme expires in 2018, beyond which point in time their economic feasibility is stressed. While CHPs may have a diminishing role to play in the future, DHCP DH still allows various heat sources to be exploited, and in effect, switching DHCPs to being electricity consumers. Being electricity consumers through e.g. heat pumps is a logical consequence of market price levels. What is infeasible for a producer will be beneficial for a consumer. However, as stated in the beginning, optimally, DHCP plants will have both the opportunity to provide efficiency and flexibility through e.g. CHP, heat storages and heat pumps – while at the same time providing capacity when required. Fortunately, through investment decisions made a long time ago, Danish DHCP plants are already partially equipped for this role but to take on the role as capacity provider of the future, further incentives have to be established.

For DHCP CHP to participate in the integration of fluctuating renewable energy, the plants need large electrical capacity and large thermal stores. In a normal situation, wind production is only curtailed in hours with low spot prices and DHCP CHP only produces in hours with high spot prices, which thus makes sure that DHCP CHP do not create unnecessary curtailment of wind. The large capacity and large thermal stores allow DHCP CHPs in the hours with high spot prices to produce excess heat being stored in the thermal stores, this heat being delivered from the thermal stores in hours with low spot prices where the DHCP CHPs are not producing. The effect of this is illustrated in Figure 5.

Figure 5: Simulated operation against the Scandinavian day-ahead market in one week in the autumn of 2015 of a CHP-plant equipped with large electrical capacity and large thermal store. The simulation is made in the energy systems analysis tool energyPRO.

For further information please contact:

EMD International A/S Att.: Anders N. Andersen Niels Jernes Vej 10 9220 Aalborg Ø Denmark

The fixed tariff initially applied for CHPs in Denmark was a triple-tariff with incentives for producing in certain periods of the day and week based on experience. This tariff made it attractive to equip CHPs with large electrical capacity and large thermal stores and in effect also prepared them for the role of providing flexibility. In general, all Danish DHCP CHPs are thus equipped with large thermal stores. As examples, Ringkøbing District Heating delivers app. 110,000 MWh heat to the district heating network and is equipped with a thermal store of 4,500 m3, Hvide Sande District Heating delivers app. 41,100 MWh heat to the district heating network and is equipped with a thermal store of 2,000 m3, and finally Sæby District Heating delivers app. 77,500 MWh heat to the district heating network and is equipped with a thermal store of 2,700 m3. The online operation of these plants are shown at system-consultancy/online-presentations

Direct phone: +45 9635 4456


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