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South Dublin County Council District Heating Project


Thursday, February 4, 2021

In late 2020 South Dublin County Council (“SDCC”) entered a contract for a large-scale district heating project in Tallaght, Dublin 24. This project, on which Philip Lee advised SDCC, is Ireland’s first large scale district heating scheme which will see the construction of an energy centre and associated pipe network to supply heat to SDCC’s offices, the TU Dublin Tallaght Campus and other facilities. The network also contains the potential for future expansion to a residential development to be constructed in the area.

The project will deliver a high level of innovation, as waste heat from the nearby Amazon data centre will supply the heat to the network. The Tallaght district heating scheme is being led by SDCC with support from the Dublin Energy Agency, Codema. The scheme will operate as Ireland’s first not-for-profit utility and will make a significant contribution to reducing carbon emissions in the area, saving an estimated 1,441 tonnes of C02 each year.

What exactly is district heating?

District heating is a method of delivering energy in the form of hot water through a network of underground pipelines. Energy is produced centrally at large plants and delivered to individual homes and buildings for space and water heating needs. Energy is supplied to buildings as heat rather than fuel. This eliminates the need for open fires, gas or oil boilers and flues. The usage is metered at each building so occupants pay only for what they consume.

District heating systems are widely used across Europe and currently serve 60 million people. 90% of heating needs in sustainable cities like Copenhagen and Stockholm are delivered by district heating. Comparatively, district heating accounts for a very small share of the Irish heating sector.  At significantly less than 1% Ireland has one of the lowest shares of district heating in Europe. An examination of the heat sectors in other EU Member States reveals that countries with the highest shares of renewable heat also have high levels of district heating.

District heating – benefits

Efficiency

In traditional electricity production an estimated 60% of energy is lost during transformation mostly in the form of heat. District heating systems offer advantages in terms of higher energy efficiencies and reduced consumption of energy resources.

Delivering heat to hundreds of buildings through one centrally managed heating installation reduces the cost and amount of energy consumed. Further, retrofitting existing buildings with district heating networks replaces gas or oil boilers which are often older and inefficient (and require significant levels of ongoing cleaning and maintenance).

Renewables

If the EU is to meet its climate change targets, the decarbonisation of the built environment will be essential. Traditional heating systems rely on fossil fuels that produce greenhouse gases. This is exacerbated by older, inefficient heat generators. Replacing inefficient decentralised heating systems will reduce CO2 emissions and make a meaningful contribution to mandatory emissions targets.

The ability of district heating networks to contribute to renewable energy targets is dependent on the heat supply used. As advances are made in the district heating sector, more renewable energy can be supplied through district heating networks without any action by the building owner or supplier.

District heating networks can act as a flexible and secure source of heat by relying on low carbon indigenous fuel sources which would not otherwise be utilised. District heating systems can be supplied by waste heat, heat from industry and renewables. This reduces the need for fuel imports and bolsters Ireland’s energy security.

District heating networks operate at a large scale. Renewably supplied district heating offers a fast and cheap reduction in greenhouse gas emissions. Reductions are achieved seamlessly without relying on large volumes of individual heat consumer decisions.

Data centres

87% of the heat demand in Irish buildings could be met through by-product from existing power plants, waste incineration and industrial processes. By replacing fossil fuels with this excess heat, district heating systems can provide cheap, carbon-neutral heating.

As noted above, the SDCC district heating scheme will be supplemented with waste heat from the Amazon Data Centre in Tallaght. This will facilitate the supply of 4 MW of waste heat to surrounding offices, buildings and a university.

A 2016 study found that 4.8% of Ireland’s total electricity demand was consumed by data centres. This figure expected to more than double by 2024. Nearly all energy that goes into data centres for cooling comes out the other side as warm air.

The data centre sector in Ireland is growing substantially. This is leading to an increase in electricity demand and the emergence of a new electricity-intensive industry. The use of heat recovery should be prioritised for its reduced emissions and costs. It is likely that planning consents for data centres will be conditional upon the re-use of waste heat they produce.

District heating – disadvantages

Competition

As customers are supplied by a local district heating company they do not have the option to switch provider like in the gas and electricity sector. As a result district heating suppliers operate as a monopoly and require effective regulation to ensure fair prices for consumers. Not-for-profit district heating systems (as seen in the SDCC project) can ensure low end prices for customers. Similarly, Norway and Denmark have regulated district heating prices to increase consumer confidence.

Physical constraints

Structural barriers exist to rolling out district heating networks in remote areas occupied by low population density. Owing to high network installation costs district heating networks are more suited to urban areas with high population densities and relative high heat demand. This is due to needing shorter pipe lengths which reduce the installation costs and heat loss during transmission. Even in Denmark, a country with a highly developed district heating sector, rural district heating is not very common.

Legislative barriers

District heating networks require substantial initial investment. Countries leading on district heating have had significant investment subsidies to aid development. Currently, there are no guidelines, regulations or policies in place in Ireland. Without an adequate national policy framework investment remains uncertain and high risk. It is worth noting that a public consultation to inform a policy framework was carried out in 2020 and is currently under review.

Legislative drivers

The Sustainable Energy Authority of Ireland introduced a Support Scheme for Renewable Heat in 2019. It is a government funded initiative designed to increase the energy generated from renewable sources in the heat sector. The grant is available for installation costs in addition to ongoing operational support and is open to commercial, industrial, agricultural, district heating and public sector heat users.

Ireland’s National Energy Efficiency Action Plan has influenced the use of energy in new buildings by introducing minimum energy requirements for new builds. This supports the use of low temperature heat supply from district heating systems to new developments.

It has also had the effect that many new apartment blocks and commercial buildings have centralised heating systems based on low-carbon technologies. Centralised water-based systems are easier to retrofit to district heating connections than those with electric or individual heating systems.

The Technical Guidance Document accompanying the Building Regulations (Part L) notes that the use of centralised renewable energy sources” contributing to a heat distribution system serving all dwelling units in a district… “may prove to be more practicable than providing separate renewable energy for each dwelling individually and may be counted towards the Renewable Energy Ratio”.

EU legislation

The European Union’s 2030 Framework for Climate and Energy is designed “to help the EU achieve a more competitive, secure and sustainable energy system.” The main regulations concerning heating and cooling are proposed in the EU Renewable Energy Directive and the Energy Efficiency Directive.

The Renewable Energy Directive proposes to increase the share of renewables in heating and cooling by one percentage point annually.  The Renewable Energy Directive emphasises the potential role of district heating in the integration of renewables by addressing “non-discriminatory access” to the infrastructure, customer protection, and the importance of integrating electricity in the heating/cooling system. (European Commission, 2016).

The Energy Efficiency Directive includes binding measures to reach 30% energy efficiency targets by 2030. Recognising the important role of district heating the Directive requires member states to “carry out a comprehensive assessment of the potential for high-efficiency cogeneration and district heating and cooling”.

According to the EU, the amount of waste heat produced from industrial processes would meet the entire heating needs of buildings across the EU. The EU adopted a Heating and Cooling Strategy which outlines actions to increase the share of renewables through district heating and cooling. Included is the recommendation to ‘direct feed’ via district heating systems waste energy from industry to utilise it for heating/cooling purposes.

Conclusion

Whilst district heating is not suitable for every development, it will undoubtedly have a role to play in the future in Ireland.  It requires careful planning and foresight but other countries, in particular Sweden and Denmark, have demonstrated both its feasibility and advantages.

The current climate crisis is at a critical point and swift action is required.  Ireland did not meet its 2020 EU energy targets and we must now ensure the same does not happen for 2030.  With the advent of high energy developments such as data centres, the potential of district heating will be realised on a wider scale in the near to medium term.  For this the likes of SDCC must be commended for taking the lead and implementing the first project of this kind in Ireland – hopefully other public authorities will follow suit.

 

For further information in relation to the above article, contact Hugh Cummins.

Article written with the assistance of Sallie Shipsey.

 


Author

Hugh Cummins

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