Home Articles LET’S COMPETE – BUT AGAINST RELEVANT ALTERNATIVES

LET’S COMPETE – BUT AGAINST RELEVANT ALTERNATIVES

by Linda Bertelsen
papirflyvere

In many places, new fossil-free heating solutions are met with requirements stipulating that they cannot cost more than natural gas. The reasoning behind such a rule is difficult to under stand and will clearly not do any good for the green transition in heating.

By Morten Jordt Duedahl, Business Development Manager, DBDH and Lars Gullev, Managing Director, VEKS and Vice president, IEA DHC

This article was published in Hot Cool, edition no. 4/2022

District heating is ready to compete with all heating alternatives – but of course on equal terms. Throw heat pumps, hydrogen, biogas, and everything else that is sustainable at district heating, and we will see who wins.
In some instances, modern solutions may cost more than (subsidized) “black” natural gas. In these situations, a carbon-neutral solution also must be found. Under a “not more than” rule, the risk is to leave many people behind in areas where no green solution can compete against the subsidized natural gas prices. Should these areas not be offered a carbon-neutral heating solution? Do they have to freeze?

It is a government’s task to protect its citizens against price increases they cannot afford or will dramatically change their lives. But at the same time, it is also the government’s task to protect its citizens against climate change and its effects.

Affordability can be many things. Black, natural gas may look affordable (pricewise), but that price does not include all costs and will leave a debt to be paid in the future. When is a non-sustainable solution affordable?

The problem lies in the comparisons to an obsolete, fossil solution we should not be allowed to install anymore. A comparison to fossil solutions is not realistic nor relevant to make. Imagine this situation! First, district heating looks like a viable solution, but the calculations show it is not price-competitive to natural gas. Then a comparison between heat pumps and natural gas is made, and again gas presents the lowest cost.

Do we think installing natural gas is a good idea then? Of course not. We all know it is a bad idea and should be avoided. A new neighbourhood should not have natural gas! On the other hand, there is a strong and relevant need to protect customers against sudden price increases they cannot afford. We need to ensure that this protection is given to services/products we find are the right ones, the solutions that benefit society and customers. Here is not the place to tell how – just to raise the concern.

At the same time, we constantly discuss the need to protect all against continued carbon emissions. Look at the “fossil-free by dates” set by countries, industries, and others. With a “not more-than-natural-gas regime,” governments do not live up to their pledge to protect their citizens and future generations against the effect of carbon emissions.

As has been shown many times, we will and should end up with heating solutions in small, large, and mega-size cities based on diverse heat sources and large storages. Everywhere else (roughly), we should have individual heat pumps supported by renewable power. Should someone consider hydrogen, biogas, or other precious fuel sources for heating buildings, the district heating industry is happy to compete – and win 🙂

The present energy crisis may be a tipping point as the competition with natural gas has suddenly become easy to win. But, still, the right decisions should be taken. Today many solutions can win against natural gas, but the real competition should be among the fossil-free options. May the best fossil free solutions be the winner.

Let’s compete in the same class and on equal terms. The “not more than”-rule is not equal terms as it takes an obsolete, outdated, fossil, (for many) import-dependent, and politically controversial solution as the baseline. The baseline should not be fossil solutions; the lowest price should determine the winner, maybe supplemented with local requirements like import in
dependence, future proof, job creation, and pollution-free. With such a rule, all would get the best solution and the lowest
price.

PS: Hydrogen, PtX, CCU, and the integration to district heating are the theme for the following two issues of Hot Cool. They will be out right after the summer break. Spoiler alert: These technologies are needed and can provide enormous amounts
of surplus heat – but should never heat buildings.

“Let’s compete – but against relevant alternatives” was published in Hot Cool, edition no. 4/2022
Let's compete - but against relevant anternatives, article by Lars Gullev and Morten Jordt Duedahl
Dowload and print the article here

Meet the authors

Morten Jordt Duedahl
Business Development Manager, DBDH
Lars Gullev
Senior Consultant, VEKS