HOT|COOL NO. 7/2022 "GROWING MARKETS"

NO. 7 / 2022

INTERNATIONAL MAGAZINE ON DISTRICT HEATING AND COOLING

DISTRICT HEATING AND THE Growing Markets

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COLUMN A 10 POINTS PLAN TO ACCELERATE THE EU HEAT TRANSITION By Aurélie Beauvais

By John Tang Jensen, and Morten Jordt Duedahl 6

17

MEMBER COMPANY PROFILE: ADDED VALUES By Anna Weis

MULTIPLE HEAT SOURCES PROTECT CONSUMERS FROM ENERGY POVERTY

Feedback from our 2019 Conference

12

WE MUST MAKE IT EASY FOR CUSTOMERS TO GET DISTRICT HEATING By Thomas Hopp

Adriana: What made me laugh was to see how uncomfortable

the room was at the beginning of the session with the drag queens. We were all like 'oh, this is so weird...' And I was sitting next to people that I'm negoti- ating with or consultants that I work with and we were all like 'aaah....this is not what we do...". And as time went by, things just changed. People embraced it and were designing their dolls…

Lina: ...there was dancing…

The data suggests diversity correlates with better financial performance. Likelihood of financial performance above national industri median, by diversity quartile, % Ethic diversity Top quartile Bottom quartile 58

Adriana: …dancing - that made me laugh a lot! We were just so awkward and out of our com- fort space as soon as we had to do something with glitter and glue and paper!

43

+35%

Gender diversity Top quartile Bottom quartile

54

47

+15%

Gender and ethic diversity combined Top quartile All other quartiles

53

40

+25%

Source: McKinsey Diversity Database

DBDH Stæhr Johansens Vej 38 DK-2000 Frederiksberg Phone +45 8893 9150

Editor-in-Chief: Lars Gullev, VEKS

Total circulation: 5.000 copies in 74 countries 10 times per year

Grafisk layout Kåre Roager, kaare@68design.dk

Coordinating Editor: Linda Bertelsen, DBDH lb@dbdh.dk

info@dbdh.dk www.dbdh.dk

ISSN 0904 9681

https://www.districtheatingdivas.com/

What if digitalisation could make heating more sustainable?

The EU targets energy efficiency improvements of 36-39% by 2030 With frequent data readings, automated measurements and real-time decision-making, digitalisation is optimising the 4th generation of district heating. At Kamstrup, we have the know-how and digital solutions that can accelerate the green heating transformation and improve energy efficiency.

Read more at kamstrup.com/heat-solutions

HELLO, HOW CAN WE SUPPORT YOUR CITY? DBDH is the Go-To-Platform for district energy. We cooperate with all DH stake holders and support cities in their quest for a sustainable city transformation.

Use our strengths to help your city. We are the link to:  Achieving climate goals through fossil-free district energy  Strategic energy planning  Knowledge on district heating and cooling  A wide network of experts  Visiting green solutions in Denmark

We do not know everything about district heating, but we know who does :) Contact one of our team members. Our advice is free of charge.

Lars Hummelmose lh@dbdh.dk Contact for China and other Asian countries, North America, and the Middle East

Pia Zimmermann pz@dbdh.dk Contact for Eastern Europe, the Baltic States and CIS countries

Morten Jordt Duedahl md@dbdh.dk Contact for Western Europe

Hanne Kortegaard Støchkel HKS@dbdh.dk Sector integration and new heat sources

DBDH ACTIVITIES | HOT COOL EDITIONS | NEWSLETTER SUBSCRIPTION (FREE)

A 10 POINTS PLAN TO ACCELERATE THE EU HEAT TRANSITION Today’s energy security crisis is a heating crisis. This is a message that bears repeating. The challenges we face are unprecedented: heating and cooling account for 50% of EU energy demand, with natural gas supplying a stunning 42% of the heating and cooling demand. Luckily, most of Europe’s gas is used for low-temperature heating in buildings, which can be replaced with exist- ing technologies. But are we up to the job?

By Aurélie Beauvais, Managing Director, Euroheat & Power

ensure that we support not only solutions that are “good on paper” but solutions that will work for everyone, every region, and wallet. The challenge is immense but not impossible. There are solu- tions available that can be immediately deployed to phase- out fossil fuels in heating. These solutions are locally owned, climate-friendly, ready to deploy, and affordable. We can har- vest local renewable and sustainable waste heat sources by deploying and expanding efficient heating networks. We can also deploy clean heating technologies such as heat pumps. In short, we can deliver concrete results to save natural gas, shield European consumers from soaring energy prices and strengthen the resilience of our energy system. Still, the first six months since the presentation of the REPower EU have passed, and too little has been done to make this happen. On the 18th of October, ten organisations united under the leadership of Euroheat & Power proposed a 10-point plan to accelerate the EU heat transition. The plan covers a range of measures, some of which may be integrated into the next batch of EU emergency measures. These include mandatory heat planning for local authorities, the EU-wide phase-out of individual boilers that use only fossil fuels, or even dedicated incentives to recover sustainable waste-heat sources which remain untapped in several urban areas. The 10-point plan also underlines the necessity for a new EU heating and cooling strategy with concrete regulatory and fi- nancial instruments to unlock the full potential of renewable and sustainable waste-heat solutions in heating networks. This crisis has become the perfect “energy storm” to acceler- ate the uptake of smart and sustainable district heating and cooling technologies in Europe. Now is the time to upgrade our emergency toolbox with concrete measures to spark a long-overdue clean heating revolution, bringing Europe on the path to climate neutrality and energy independence. Download the 10-point s plan

In the Brussels corridors, there is a rumour that “renewable energy is freedom energy.” It couldn’t be more accurate, as renewable electricity sources such as wind and solar are growing exponentially and provide a solid boost to decarbon- ise heating, notably through residential and large-scale heat pumps. Recent EU energy and climate initiatives (such as the ‘Fitfor55’ package and REPower EU) mainly focused on supporting the deployment of renewable electricity sources and their mol- ecule-based twin, renewable hydrogen. However, it is only a part of the solution: in 2019, electricity represented only 6% of household energy consumption for heating. So what about the remaining 94%? 1 Before the crisis, we had the luxury of time to wonder what would be the cleanest and most efficient heating sourc- es to decarbonise fully by 2050. However, the situation has changed drastically, and while the demand for clean heating technologies has never been higher, we must now satisfy four additional imperatives. First, we need solutions that can achieve a quick and sizea- ble reduction in natural gas demand for heating, either by increasing efficiency or replacing fossil fuels-based heating. Second, these solutions must be mature, reality-proofed, and available for fast-rolling over the next 3 to 5 years. Third, the clean heating solutions we’re looking at should address the short-term imperative to break free from natural gas depend- ency and be aligned with Europe’s long-term pathways to- ward climate neutrality. Last, the solutions that will comple- ment our “energy crisis exit toolbox” must be fair and leave no one behind. We must insist on this last bit: this crisis is a social bomb in the making. Energy bills are soaring, and EU SMEs and companies are putting their activities on hold across Europe. The EU uni- ty is already being torn apart by the current economic crisis and rising social discontent. For the future of Europe, we must

1 Source: Odyssee-mure

HEAT SOURCE DESIGN FOR DISTRICT HEATING NETWORKS

MULTIPLE HEAT SOURCES PROTECT CONSUMERS FROM ENERGY POVERTY

By John Tang Jensen, Senior Policy Advisor, Clean Heat Directorate, BEIS and Morten Jordt Duedahl, Business Development Manager, DBDH

The present European energy crisis with both very high gas and electricity prices shows that district heating network companies having multiple heat sources and storage sys- tems can keep heat prices low. District heating systems able to use various waste- and ambient heat sources and produce renewable electricity can protect consumers from energy poverty. To achieve a resilient heat price, the normal reserve- and peak-load capacity should be technologies complementing the normal base-low technologies. If, for example, the pres- ent base-load technologies are dependent on low fuel- or electricity prices, the comple- menting technologies should be dependent on high electricity prices like CHP plants or own renewable electricity production units like wind turbines or solar PV.

Heat sources

Figure 1. Original heat source design

Peak- and reserve-load

Base-load

Abstract Many district heating network companies manage to keep heat prices on the same level in the present European ener- gy crisis with increasing fuel and electricity prices. For con- sumers and the national economy, it can be essential to avoid heat prices following increasing fuel and electricity prices, which can lead to recession, fuel poverty, and affect employ- ment. This article investigates and discusses how it is possible to keep heat prices at the same level when fuel and electricity prices go up, which can inspire the design of future district heat source solutions. The story is about using different tech- nologies complementing each other, often called a Smart Energy system or integrated energy solutions. Original heat source design Most district heating systems operate with a base-load source, which provides the main heat delivery capacity, and a reserve- and peak-load source, which provides capacity able to pro- duce heat when the largest base-load capacity is not running and additionally provide capacity for the very few days in a year, when it is extremely cold, and peak-load capacity is need- ed. The reserve- and peak-load capacity deliver supply security to consumers and additionally ensure low investment costs, as the combination of technologies is cheaper per MW-capacity compared to expensive base low technologies. Originally district heating networks were designed around one large base-load heat source like coal CHP, gas CHP, waste incineration CHP, biomass CHP, and in a few cases, industri- al waste sources. The base-load capacity initially delivers be- tween 50 % and 80 % of capacity (MW) but up to 95 % of the total heat demand (MWh). The share varies from network to

network and depends on local conditions and available heat sources. Figure 1 shows an example of the original design.

The reserve- and peak-load capacity has typically the size of the largest base-load unit and is often an oil or a gas boiler. If only one base-load unit is established, it is usually designed for 70 – 80 % of the total capacity needed, optimizing invest- ments. If the base-load capacity is split between more units, the to- tal base-load capacity can be well above 80 % of capacity de- mand. Then reserve- and peak-load capacity is only needed in the same size as the largest base-load unit. By combining a CHP plant and reserve boiler capacity, the re- serve capacity will also ensure the heating price is not getting too high when the electricity price and earnings from power sales are low. Figure 2 shows how combining a natural gas boil- er, and a natural gas CHP plant can ensure the heating price is not too high. Unfortunately, the system in figure 2 does not always ensure a low heat price because both the electricity price and the heat production price on the boiler depend on the natural gas price. If the natural gas price goes up, the heating price from the boiler also goes up. The heating price can only be main- tained low if the electricity price increases as well, which often is the case in fossil natural gas-based electricity market sys- tems, but not necessarily in an electricity system dominated by renewable electricity sources like water and wind turbines and PV panels.

Marginal heat production costs (Gas price 65 £/MWh)

Figure 2. Marginal heat price natural gas technologies

Figure 2 shows that heat production will be based on a natural gas boiler when electricity prices are below 140 £/MWh and on CHP production when above. It is an example including O&M costs and costs for Emission Trade Scheme (ETS) with an estimated 68 £/ton CO 2 . Combining the two technologies ensures that the heat production price will never exceed the natural gas boiler price.

HEAT SOURCE DESIGN FOR DISTRICT HEATING NETWORKS

Using technologies designed to produce heat 2000 – 4000 hours (middle-load) was not part of the original heat source design. It only emerges if alternative heat sources like industri- al waste heat are found and established or if local authorities choose to build waste incineration plants in networks initially having fossil CHP. When waste heat or incineration deliver heat cheaper than fossil CHP, the CHP unit turns into middle-load capacity if the heat network is not expanded, making heat prices less dependent on fossil prices. Present Heat source design A high amount of renewable power production from wind tur- bines and solar PV plants and the day-ahead electricity mar- ket changes how heat sources should be designed for district heating networks. When the initial heat source design is kept, the fossil CHP plants will produce less heat when electricity prices are low. This makes the reserve- and peak-load boilers produce more heat to cover the decreased heat deliveries from the fossil CHP plant. The heat prices then go up. Fos- sil CHP units can no longer ensure low heat prices, and the district heating companies must look for other solutions and low-price base-load sources than fossil CHP providing low heat prices when the electricity price is low. Heat storage can optimise the income from selling electrici- ty from CHP plants by turning heat production down and electricity production up when electricity prices are high and vice-versa when electricity prices are low. Heat storages also level out heat demand and make production time independ-

ent of heat demand. Heat storage is now beneficial for district heating networks able to sell flexibility to the electricity mar- ket, but it is not enough to prevent heat prices from increasing. The obvious choice is to find a heat sources where the heat- ing price is not dependent on the natural gas or the electricity price. This can be a biomass boiler or an industry’s high-tem- perature waste heat source. Both are limited heat sources not available for everyone and everywhere, but if the district heating network can get access, the source can be important for ensuring low heat prices. Figure 3 shows the variable heat price for gas technologies combined with a cheap waste heat source (25 £/MWh-heat). The design of heat sources could benefit from a heat source delivering low heat prices when electricity prices are low. A heat pump using ambient 1 , infrastructure 2 , and/or low tem- perature waste heat sources found almost everywhere could deliver this. Figure 4 shows how the marginal heat production price develops compared to natural gas sources The present energy crises in Europa due to the Russian/Ukrain- ian war and the following very high natural gas and electricity prices simultaneously show that this solution can also increase the heating prices. If the gas price is 150 £/MWh-gas, the elec- tricity price needs to be below 330 £/MWh-electricity before the heat pump is cheapest. Most importantly, the heating price can go up to 100 £/MWh-heat if both natural gas and electricity prices increase to this level, which means there is no

1 Ambient Heat sources: Air, sea, rivers, lakes, solar, ground water or geothermal sources.

2 Infrastructure: Wastewater treatment, sewage, water pipelines, mines, underground railway, electric transformers, gas compressors, etc.

Marginal heat production costs (Gas price 65 £/MWh)

Figure 3. Marginal heat prices gas technologies combined with a waste heat source

The waste heat source is now the base load tech- nology. The CHP plant is a sort of middle load technology running if the waste heat source cannot deliver enough heat or if electricity prices are very high - above 200 £/MWh. A storage system can opti- mise income from a CHP plant, making the running time independent of heat demand. This ensures a low heating price. Still, both biomass and high-tem- perature waste heat sourc- es can be limited sources only available for few DH networks in the future.

will be equalised by revenue from this wind turbine. Heat price will then only be dependent on investment costs for both the heat pump and wind turbine, and if the wind turbine is not sit- uated on the same site as the heat pump, also electricity tariffs. Marginal heat price can be much lower than the 25 £/MWh for waste heat in the previous examples, but higher investment costs, of course, must be included when compared. Figure 6 shows an example of a comparison of a natural gas reserve- and peak-load boiler, a heat pump alone, and a combined wind turbine and heat pump. The results in this example can vary depending on wind turbine size, compared to heat pump capacity, production profile of the wind turbine and the heat pump, storage capacity, dependency on capacity, etc. How to combine heat sources in future The above examples regarding which heat source is the best compared to electricity and fuel prices show that almost all heat sources can deliver low heat prices if the price conditions are right and heat storage is included in the system for flexibil- ity reasons. Biomass, electrical boilers, and to some extent, natural gas CHP plants may, in the future, be middle-load capacity for heating systems in years with average and low electricity prices. Co-production 3 , infrastructure, ambient, and waste (surplus) 4 heat sources may be base-load. This will switch in years with high electricity prices for the heat sources com- bined with a heat pump, which then will be middle-load. This

heat price security in example figure 4. Low-price waste energy at high temperatures or a biomass boiler is needed, as shown in figure 3. Future heat source design without fossil fuels and biomass The zero carbon targets may not make the above solutions possible because fossil CHP may not be accepted, fossil boilers may only be acceptable for reserve load purposes, and biomass may not be allowed or unavailable. Figure 5 shows the possible scenarios without fossil sources and biomass. In this example, a waste heat base-load source is available, for instance, from a waste incineration plant with a fixed negotiated heat price. When waste heat sources are unavailable and heat can only be produced using a heat pump, the heat price risk is high and almost at the same level as the pure natural gas system shown in figure 2. It is, though, very much dependent on the reserve- and peak-load technology combined with the heat pump. When combining a heat pump and a gas boiler, the heating price can get very high, and the solution is not ideal for heat price security. The only way to equalise the increasing costs of using electric- ity for a heat pump when prices increase is to produce renew- able electricity simultaneously. Suppose the district heating company, dependent on heat production from a heat pump instead of renewable CHP, own a wind turbine at a similar size regarding electricity capacity. In that case, the electricity costs

3 CO-production: Waste incineration, Nuclear heat, Data centre and other industrial sources running 24/7

3 Waste (Surplus): Unreliable surplus heat from industry running in daytime, working days, in seasons, etc.

Marginal heat production costs (Gas price 65 £/MWh)

Figure 4. Marginal heat price

natural gas technologies combined with electric heat pump The heat pump delivers a heating price cheaper than natural gas CHP if the electricity price is below 175 £/MWh, and the heating price will not be higher than around 55 £/MWh-heat at this point. In this case, the heat pump should be designed and used for base load when electricity prices are below 175 £/MWh. If electricity prices get above 175 £/MWh, the CHP plant will deliver the main base load capacity. This combination usually can ensure low heat prices.

HEAT SOURCE DESIGN FOR DISTRICT HEATING NETWORKS

For district heating network companies, the difficulty is to get this financed and, at the same time, avoid too high heat prices from a depreciation of investments in multiple technologies in the first 10-15 years. It must be recognised that heat networks and heat source technologies have a long lifetime—at least 30 years for heating networks. If the -producing technologies are kept warm when not running and maintained properly. Most technologies have a lifetime above 60,000 hours of the entire load operation. The lifetime in years then can variate from 15 up to 30 years. To keep the heating price low, it should be al- lowed to depreciate the heat production technologies accord- ing to actual total load hours running time instead of linear annual depreciation independent of running time. This will ensure low heating prices according to used heat sources and technologies. It is better to have many technologies with different heat price profiles designed to use heat sources optimally compared to a few heat sources with price dependency on fossil fuels and electricity. The district heating network company should own ambient in- frastructure, reserve, and peak-load heat source technologies to ensure supply security and competitive heat price if base- load waste heat sources are purchased from external sources. Base-load heat sources like heat from waste incineration and other co-production sources should be designed for 24/7 heat production to minimise capacity investments and ensure low heat prices, including capacity costs.

delivers a flexibility to the electricity system and, to some ex- tent, disconnects heat prices from varying fuel and electricity prices. Heat pumps using ambient heat as a source will have a mid- dle-load capacity in heat networks with heat from waste incin- eration, infrastructure sources, and waste heat from the indus- try as base-load. Future base-load heat sources will typically be purchased from a heat supplier. Middle- and peak-load sources will typ- ically be developed and owned by a district heating network company.

Figure 7 shows an example of a new heat production design.

The size in capacity (MW) and delivery (MWh) may vary de- pendent on accessible heat sources, available capacity, re- liability, fuels, and electricity prices. To get a low average marginal heat price from the technologies, the total sum of capacities for base- and middle-load technologies may need to include needed reserve- and peak-load capacity as well. This will increase the investments but decrease the use of often expensive fossil fuels in reserve- and peak-load tech- nologies In the end, a district heating network can end up having more capacity than needed, but this “extra investment” in capacity will be leveled out by having different options depending on the market prices the sources are operating on. The heat price can always be optimised if other options are available, and heat storage is included to absorb cheap heat produced when the market price is the best.

For further information please contact: John Tang Jensen, JohnTang.Jensen@beis.gov.uk Morten Jordt Duedahl, md@dbdh.dk

Marginal heat production costs

Figure 5 Marginal heat price heat pump and waste heat sources

If the electricity price is above app 78 £/MWh, it is better to purchase waste heat than heat produc- tion on the heat pump. Depending on the power price level, both technolo- gies can be base-load heat supply sources. Heat price will, in this example, not at any time be higher than the negotiated waste heat price and often lower in times with low electricity prices.

Marginal heat production costs (Gas price 65 £/MWh)

Figure 6 Marginal heat price heat pump, gas boiler, combined heat pump, and wind turbine Figure 6 shows it can be very feasible to combine a heat pump with a wind turbine delivering electricity to a heat pump directly or, in this case, by using the public power grid. The electricity price needs to be below 40 £/ MWh before it is feasible to stop the wind turbine and purchase electricity directly from the grid for the heat pump. If a heat pump needs to run more than the wind turbine produces electricity, the heating price will follow the purple line.

Heat sources

Figure 7 Heat production design - can vary depending on local conditions.

District heating for 7,000 new private customers in Køge, Denmark WE MUST MAKE IT EASY FOR CUSTOMERS TO GET DISTRICT HEATING

By Thomas Hopp, Distribution Manager at VEKS

A rapidly growing part of VEKS' business is the development of VEKS Distribution, including Køge Fjernvarme. In Køge, the task over the next five years is to supply district heating to 7,000 new customers who typically live in single-family houses.

The core business of VEKS transmission company is to sup- ply surplus heat from large central cogeneration plants and waste energy plants to 20 local district heating companies. From a few large to many small customers When VEKS broke ground for Køge Fjernvarme well over ten years ago, the target group for the extension was only large customers - customers over 300 m2. A joint venture between Aarsleff and Wicotec won the overall contract, and Ramboll was the client's advisor for VEKS/Køge District Heating. In mid-2014, the first stage of the district heating system and the pump and exchanger station was established and ready to supply large new customers with district heating. But why did VEKS venture into a completely new business area? Back in January 2009, the government encouraged Køge Municipality, like all the country's municipalities, to boost the expansion of district heating through a natural gas conversion. The goal was to reduce the total emission of CO2 in Denmark.

VEKS was asked to take on the municipal task, as district heating was/is one of the most essential instruments for com- plying with Køge municipality's climate plan. The environ- mental benefit of the project is an annual CO2 reduction of 40,000 tons.

The project has since changed character.

From CO2 reduction – and now away from gas prices In Køge - a municipality approximately 30 km south of Co- penhagen - 7,000 private customers are now queuing to get district heating. Expanding district heating is crucial in Den- mark's climate goal of reducing CO2 emissions by 70% by 2030. Politically, the ambition is simultaneous to become independent of Russian natural gas, thereby reducing the importance of gas in the energy supply. But for the current natural gas customers in Køge, the desire for district heating has become very urgent. They are under personal financial pressure from the current international energy crisis, which has led to skyrocketing natural gas prices.

Photo VEKS

many customer inquiries, participate in customer meetings, draw contracts, manage communication during the process, etc. At the beginning of 2023, the department will be staffed with about ten employees, primarily based in Køge. Everyone in the department is focused on maintaining an overview of the district heating project's practical rollout. Planning, project planning, and rollout are handled by other departments in VEKS, which makes mutually high demands concerning internal coordination. Campaigning to get new customers The first sales campaign started in the spring of 2022 in a resi- dential area in the northern part of Køge with 1,700 potential new customers. More than enough customers are interested, so construction work can begin early 2023. The focal point for the campaign is Køge Fjernvarme's web- site, partly about timetables, Q&A, background information, etc., and partly about the actual registration for district heat-

Large tasks are, therefore, also in the queue at Køge Fjern- varme before the district heating can heat the homes of the many new customers. From operation to close customer contact At VEKS, our approach is that if the spread of district heating is to succeed in Køge, the customer experience must be positive. The future task in relation to private customers is very differ- ent from servicing the current customer group in Køge, which are primarily large customers in the form of businesses, hous- ing companies, institutions, etc. Functions for VEKS Distribu- tion have so far been about operating and maintaining the existing network. With 7,000 new customers on the way, one of the first tasks has been to recruit employees and new skills internally in VEKS and externally.

Several new employees have joined. They already receive

Photo VEKS

ing, which takes place online. Køge Fjernvarme also has a Face- book page that informs about the project and allows users to ask questions and comment. As the campaign is rolled out to new areas, potential new cus- tomers will receive printed sales material. However, doubts and the need for further clarification can always arise. The em- ployees in the distribution department are ready to receive customer inquiries via mail or telephone and possibly arrange a meeting with the customer. The new distribution department will have an office in con- nection with Køge combined heat and power plant but also operates with a customer office close to where the customers come daily. In mid-October, the office opened in Køge Midtby (Køge town center) after having had an address in northern Køge for a few months. In addition to expanding district heating for single-family houses, district heating must also be established for new con- structions. Finally, new smaller customers must be connected with branch lines in the areas where district heating is already es- tablished but only supplies the current large customers. This "densification" will take place over time. The construction project In addition to establishing a more customer-oriented distri- bution department, in connection with the rollout of district heating in Køge, VEKS has hired several internal employees to manage the construction work. However, some external services and resources are also includ- ed in the project. A consultancy agreement and an agreement regarding the first significant contractor services have been en- tered. Later, there are additional contractor tasks to be offered. The new private customers can also purchase their district heat- ing installation on a subscription scheme that Køge Fjernvarme offers. This means that for a small, fixed monthly payment, the customer gets a district heating unit installed, owned, and ser- viced (and possibly replaced) by Køge Fjernvarme. The actual setting up of units is also offered to external contractors. Cooperation with the municipality Throughout the entire process - back from the groundbreak- ing in 2012 - VEKS/Køge Fjernvarme has closely collaborated with Køge municipality.

Establishing district heating for the 7,000 new customers has been a "master plan," which defines which areas in Køge the district heating will be rolled out first. This expansion plan is quite ambitious and requires constructive and open coopera- tion with Køge municipality. Where Køge Fjernvarme focuses on avoiding disappointed customers, the municipality wants to avoid dissatisfied citizens as far as possible. They have agreed on a close partnership, which is reflected in the organization around the project. A political monitoring group meets four times a year. Members of the municipality's climate and planning committee and interested parties from the finance committee meet with VEKS' director, distribution manager, and planning and project manager. If necessary, VEKS' chairman also participates in these meetings. In the po- litical follow-up group, the status of the district heating expan- sion is given. Regular orientation and coordination meetings are held be- tween representatives of the administration and Køge Fjern- varme - some monthly and others with a frequency of every 14 days. Along the way, there is also ongoing follow-up and briefing from Køge municipality on expansion areas and extensive new construction. New buildings must also be supplied with dis- trict heating. In addition to informing and providing a transparent picture of the project, the purpose of the close contact is to jointly han- dle the problems and obstacles that will invariably appear in a large construction project so early that they cause the least possible delay for the expansion and thus, ultimately for the customers. District heating novices As mentioned, the aim is to make it attractive to become a cus- tomer of Køge Fjernvarme and to ensure that the overall cus- tomer journey is as smooth and understandable as possible. Køge Fjernvarme's responsibility is to satisfy customers before, during, and after they become district heating customers. In short, customers should face as little hassle as possible. For industry professionals, it can be challenging to understand the often relatively poor knowledge of district heating. The fact is that many new customers are novices. District heating is not a plug-and-play solution that is installed overnight. Therefore, the employees in VEKS' distribution department must always

The aim is to make it attractive to become a customer of Køge Fjernvarme and to ensure that the overall customer journey is as smooth and understandable as possible.

FACT BOX

prioritize the customer's perspective: What does the custom- er want to know, what is the customer concerned about, and how do we make it easy for the customer? Disappointed cus- tomer expectations must be avoided as far as possible. If the experience of getting district heating is positive, the new customers become the best ambassadors for district heating. They will speak well of the district heating to neighbors, friends, and family. The new customer consultants and advisors in VEKS Distribu- tion are very focused on ensuring that the collaboration with the customer continues, either when the delivery agreement is signed or when the district heating starts heating the house. There will be trouble for new and "old" customers. They must have a quick response to their questions - as well as answers to the complaints that will inevitably come. Crowded market The total investment for Køge District Heating will be approxi- mately € 110 million before the end of 2028. However, this figure is still being determined, as the market is quite tight. It is not only Køge Fjernvarme that has an ambi- tious expansion plan, as many other district heating compa- nies are also expanding in these years. The market is tight with many materials on backorder, prices have exploded, and there is a labor shortage. For VEKS, it is crucial that the project's finances are connect- ed to ensure customers a competitive price. VEKS's district heating price is reasonable, and new customers are offered an advantageous price for connecting to district heating. The en- vironmental benefit is recognized, so Køge Fjernvarme has a firm offer for new district heating customers.

VEKS (Vestegnens Kraftvarmeselskab I/S) VEKS is an inter-municipal general partnership that is operated as a non-profit enterprise. VEKS includes the production, transmission, and distribution of dis- trict heating in the capital area of Vestegnen (West- ern Copenhagen). Twelve municipalities in Vestegnen with a total of 500,000 inhabitants are jointly and severally liable to VEKS' economy. VEKS was founded in 1984 Its primary objective is to utilize heat from the CHP plants and surplus heat from waste incinera- tion, major industrial enterprises, etc. 135km of twin pipes have been laid with 62 heat exchange stations and 18 pumping stations trans- mitting heat to the local district heating systems. Most of the heat is supplied to VEKS from the Avedøre CHP plant, the other CHP plants in Copenhagen, and the waste-to-energy facilities ARGO and Vestforbrænding. The transmission system is controlled, adjusted, and monitored from a 24-hour staffed operations center in VEKS' headquarters in Albertslund. The supply reliability is high in the area, with 29 local boiler stations being used as reserves and for peak load during particularly cold spells.

For further information please contact: Thomas Hopp, thh@veks.dk

Construction work in Køge has been ongoing since 2012. PHOTO: VEKS

Thomas Hopp Thomas Hopp started at VEKS in mid-June 2022. Previously, Thomas Hopp has, among other things, worked in the Min- istry of the Environment and Energy and was head of the secretariat in energy companies and municipalities. His most recent position before VEKS was customer director in the supply company FORS.

Inauguration of Køge District Heating on 29 May 2012 Finn Aaberg, VEKS's chairman at the time, praised the quick decision-making process. He pointed out that it is only help- ful if there is action behind words: "Here is the opportunity to realize the climate and energy policy that everyone agrees on is the way forward, but which can sometimes be difficult to bring from the political agreement to reality."

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Model-based design and new energy technologies ensure robust CO2-neutral heat and power generation and maximum investment value for our customers.

New technologies adapted to the local energy set-up “The present need for innovative and zero-carbon energy pro- duction pushes forward the usage of new energy technologies. Besides simulation scenarios, our robust energy solutions in- clude a flexible mix of technologies and CO2-neutral fuels. And of course, any new energy set-up must be integrated with the existing power grid and use local surplus heating to ensure a future-proof and sustainable heat and power production”, says Mogens Laursen, partner in Added Values. As consulting engineers, Added Values uses complex calcula- tions and new technologies when advising our customers. We develop optimization models to calculate which technologies should be deployed and the optimal size of the various new production capacities. Based on our extensive experience and knowledge of the en- ergy sector and energy technologies, our customers are given a strategic and quantitative road map covering up to 20 years of plant operation, securing both their investments and their future energy production. As specialized energy consultants, we offer investment optimization of new plants and operation optimiza- tion of existing plants through our extensive experi- ence within: Operational flexibility Fuel flexibility Plant and process efficiency Intelligent lifetime management Economic control room of production portfolio Market opportunities and regulations Dynamic simulation and model-based design New energy technologies FACT BOX

For more than ten years, we have added value to our custom- ers in the energy sector by optimizing their investments in new plants or by optimizing the daily energy generation in existing plants. We advise Danish and international power utilities on which new green energy plants to invest in - and when. Focusing on robust and CO2-neutral heat and power production, our com- plex sustainable energy solutions using the latest technologies are noticed internationally. And by using our in-house devel- oped software models, we simulate future operation scenarios technically and financially. This way, unforeseen challenges are avoided even before commissioning. Model-based design with significant benefits Model-based design and dynamic simulation allow us to sim- ulate various operating situations and identify any flaws before commissioning. Not only does dynamic simulation save time and money because it ensures an efficient and smooth com- missioning, but this process also delivers quality assurance of the subsequent daily plant operation. Our simulation-based design relies on languages or programs such as GAMS, Ther- moflex, and Modelica. The latter is particularly suitable for modeling large, complex dynamic systems. “Model-based” means that mathematical calculation models are used to predict or simulate how a physical system behaves, and “dynamic” refers to a particular type of equations describ- ing how the physical system changes over time. This could be how a warm system gradually loses heat to its surroundings, for instance. In a project for DIN Forsyning in Esbjerg, we applied mod- el-based design in connection with the project Green Dis- trict Heating. The purpose of this comprehensive and com- plex project is to replace Esbjergværket’s coal-based CHP production with a sustainable energy source. Together with DIN Forsyning, we identified a solution comprising two sea- water-based heat pumps, a woodchip boiler, and an electric boiler. And by means of Modelica, we simulated how heat from these plants was to be transferred to the district heating network. A complex and thorough design which facilitates a smooth commissioning.

For further information please contact: Anna Weis, awm@addedvalues.eu

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