This group brings together the best thinkers on energy and climate. Join us for smart, insightful posts and conversations about where the energy industry is and where it is going.

10,288 Members


Talkin' 'Bout Cogeneration: Prospects for 2015

europe cogeneration

An essential strategy

As sustainable energy moves up the political agenda, low carbon solutions for heating and cooling are coming to the fore. Every year, almost 50% of the total energy consumed in Europe is used for the generation of heat for domestic or industrial purposes. There is an emerging consensus on what could be a big part of the solution here, with the International Energy Agency recently citing co-generation and district heating as ‘an essential part of strategies for greenhouse gas emissions mitigation and energy security.’ Analysis of the European energy system’s resilience in the face of disruptions in Russian gas imports presented in the European Commission’s Stress Test Communication pointed to fuel switching through district heating and cogeneration as a key measure for ensuring long-term energy security – and reducing dependency on Russian gas supplies.

Co‐generation and efficient district heating and cooling (DHC) can support an integrated energy system by providing a flexible link between electricity and thermal energy while delivering enhanced energy efficiency. These technologies are mature, yet progress in deployment has been frustratingly slow. Global electricity generation from co‐generation was reduced from 14% in 1990 to around 10% in 2000, and it has remained relatively stagnant since then.[1]

Patchwork markets

In Europe, market development has been typically patchwork. Most of the space and water heating (88%) in the EU is performed by individual boilers for self-consumption while the overall share of district heating is 12%.[2]  This average masks radically different markets: the Nordic countries, where district heating is well-established (for example, 98 % of Copenhagen’s heating needs are met through heat networks); Germany and Austria, where the market is expanding fast; UK, Netherlands and Belgium where market penetration is much lower but showing growth, Mediterranean countries with less than 2 % market share; and the Eastern European countries where large scale heat networks are already in place – although in need of modernization. Here there are legacy issues to overcome, as poor service during the Soviet era has left reputational damage in its wake.   

Policy and planning

This year, there’s a policy push from Brussels via the Energy Efficiency Directive (Article 14). By the end of 2015, all member states are required for the first time to submit to the European Commission a comprehensive assessment of the potential for the application of high efficiency CHP and efficient district heating and cooling.

Funded by the Intelligent Energy Europe programme, the Stratego project is supporting the development of national heating and cooling roadmaps (required by the Energy Efficiency Directive) by compiling a pan-European heat map – the European Thermal Atlas. The heat atlas will comprise an EU28 map of 1km2 grid resolution, which for each cell (1km2) will contain the modeled heat and cooling demand, the local density of both demands, the basic geometry of DHC supply, the available waste heat resources and the potential for renewable energy sources (solar thermal, geothermal, relative accessibility of biomass).

According to Nicolas Février, who is coordinating the project,

‘City planners have a pivotal role in developing eco-districts where the upgrading of building stock goes hand in hand with the establishment, expansion or modernisation of district heating and cooling networks. This Atlas will allow you to rapidly check the thermal resources available in your region as well as the thermal demand.’

Some cities and regions are already moving ahead of the mandatory national heating and cooling plans. By 2025 London aims to supply 25% of the city’s energy through decentralised energy sources, like local heat networks. The Decentralised Energy for London programme aims at facilitating investment of £95 million of projects and has produced the London Heat Map, an interactive tool that allows users to identify opportunities for decentralised energy projects. (Also worth a peek is the Scotland Heat Map.)

Along with planning and legislation, a key challenge is in getting whole neighbourhoods to surrender individual boilers and sign up for a distributed heating system.

‘This is not primarily a technological challenge. The real challenge is to organize collectively and getting people to understand the benefits of a collective system,’

says Morten Hofmeister from Danish company PlanEnergi, who are involved in SmartReflex, an Intelligent Energy Europe-funded project working in six regions across Spain, Germany, Ireland and Italy to promote district heating through supporting legislation and planning.  

Open for business

Moving into implementation, another group of projects are using European funding to leverage further public and private investment into large scale district heating.

In the Netherlands, Etriplus is the energy development company of a consortium of DCGV, Alliander, Greenchoice, Arcadis and Ekwadraat. The company aims at providing low cost and secure energy supply for the agro-industrial area of Greenport Venlo. Key stakeholders are area developers Californië, Freshpark and Siberië; the greenhouse owners, the agro-logistic companies, Etriplus, the local municipalities and the province of Limburg. Three projects are planned: heating network based on a geothermal source, a gas and heating network based on CHP and HTU (High temperature storage), and cooling network and solar power. Aiming for a total investment of EUR 54 million to realize these plans, EUR 1 793 582 has already been provided by the Intelligent Energy Europe MLEI- PDA facility (now can be found under Horizon 2020 here).

Peter Elbers of DCGV explains the necessary bridging role of public funding:

‘The possible financial gap cannot be filled by market parties because of the risks. Public parties like DCGV, the province of Limburg, the national government or the European Union play a vital role.

‘The other lesson we have learned that the development of these projects often lead to a chicken-egg discussions between the investors and the energy consumers. The investors need a signed contract that gives assurance that the energy will be consumed at an agreed rate and for an agreed period of time, in order to receive financial close. The energy consumers on the other hand want assurance in advance about the specifications, volumes and price continuity prior to signing a contract. A close cooperation and communication between investors and consumers is essential to solve this issue.’

In Hungary, another beneficiary of MLEI funding (EUR 285 000) City of Kecskemét is hoping to transform its natural-gas fired district heating network into a geothermal system – and aiming to attract investment of over EUR 30 million for the project. In this area, the geothermal gradient (the temperature increase per meter of depth) is twice the global average, meaning that a 1000 meter borehole reaches earth with a temperature of over 50°C. A number of Hungarian cities operate district heating networks that can be powered by local clean geothermal energy. ‘It is a big market, and there are big opportunities’, says Pál Boza who is coordinating the project.

The CELSIUS project, funded under the EU Smart Cities & Communities/Seventh Framework research programme (to the tune of EUR 14 million, with an additional EUR 12 million from the project partners) is working in London, Rotterdam, Genoa, Gothenburg and Cologne on twelve new demonstrator projects. Market conditions among project partners vary hugely from the mature market in Gothenburg of more than 90 % penetration, to around 2 % market share in Genoa.

Just last month in Gothenburg, the project achieved a world-first when a district heating connection to the ferry Stena Danica was inaugurated. Previously the Stena Danica was supplied with hot water from oil burning when she was moored. Now oil burning is replaced with hot water from the Gothenburg district heating system.

On prospects for the European market, Jonas Cognell, program manager at the Celsius project, says:

‘We can see that there is some fresh movement, and new markets opening up. I think 2015 is the beginning of a breakthrough – but to see investments and decisions take place, we’re probably talking about a 3-5 year timeframe.’

Finance for projects

The Intelligent Energy Europe funding programme has now been subsumed into Horizon 2020, where opportunities for financing sustainable heating and cooling projects include:

  • EE13: Technology for district heating and cooling
  • EE14: Removing market barriers to the uptake of efficient heating and cooling solutions.
  • Market uptake of existing and emerging renewable heating and cooling technologiesLCE-4
  • Enhancing the capacity of public authorities to plan and implement sustainable energy policies including activities on heating and cooling planning EE7
  • Project development assistance for innovative bankable sustainable energy investment schemes and projects including district energy infrastructure investments are supported in H2020, EE-20
  • Support for the demonstration of renewable heating and cooling technologies is provided in LCE-3
  • Smart Cities and Communities , SCC-1
  • R&D for the utilisation of heat recovery in large industrial systems EE18

Find out more about the activities being supported under the Intelligent Energy Europe programme 2010-2013 in the area of heating and cooling here.

And finally, a high level conference focusing on the role of heating and cooling in the European energy transition will take place on 26-27 February 2015 in Brussels. The hot ticket here is the workshop on financing, which will include the launch of the next Energy Efficiency Financial Institutions Group report.

According to Antonio Aguilo Rullan, project advisor on energy efficiency programmes at European Commission agency EASME,

‘There will be significant focus on this topic in 2015. People are starting to realise the need for sustainable heating and cooling solutions in the energy transition.’

[1] Linking Heat and Electricity Systems (IEA, 2014)


on the short term resilience of the European gas system, Brussels 16.10.2014

Photo Credit: Europe and Cogeneration/shutterstock

Clare Taylor's picture

Thank Clare for the Post!

Energy Central contributors share their experience and insights for the benefit of other Members (like you). Please show them your appreciation by leaving a comment, 'liking' this post, or following this Member.


Bob Meinetz's picture
Bob Meinetz on Jan 6, 2015 6:14 pm GMT

Clare, let’s take a closer look at the existing examples of co-generation cited by IEA in your source, Linking Heat and Electricity Systems, as a guide to how to best lower our carbon footprint in a practical manner.

Of the six examples cited, three are co-generators of electricity (gas-fired electricity contributed to the grid) and three are localized co-generators of heat or cooling: 1) the Sunstore 4 project in Denmark, a 100% renewable district heating plant, 2) the district-cooling Bercy plant in Paris, and 3) a solar thermal district heating system at a university in Riyadh, Saudi Arabia.

These are two distinct approaches to co-generation, and it’s clear that sharing piped thermal energy is most practical for institutions or dense urban areas where heat wasted in transmission is minimal. But the real difference is apparent when we look at the aggregate carbon savings between the two approaches:

Thermal co-generation: 22.9 kt carbon saved

Electrical co-generation: 696 kt carbon saved

From these real world examples it’s fairly obvious that sharing electricity is a more flexible and less carbon-intensive method of co-generation. It has the added benefit of being able to share energy efficiently across wide geographical areas. Now – what if we were to co-generate this energy at various centralized locations, and distribute it via an electrical transmission system to all users? And by using a carbon-free way to generate that energy reliably (nuclear) we could virtually eliminate carbon waste…

Hmm, it seems I’ve stumbled upon our existing utility electrical grid, and in the popular imagination utilities are in the throes of a death spiral. The answer is simple: substitute the phrase “co-generation” for “utility”. Problem solved.

Steven Scannell's picture
Steven Scannell on Jan 6, 2015 6:51 pm GMT

I think the key to co-gen is to have hydrogen on tap. My system can do this, and to me this is the long term answer.  The Hydrogen economy is to me practical.   I have a report on it (by me, a fisherman) and I do think it’s the answer.  Wind and wave to Hydrogen.   The pipes and plumbing needed can also serve to be monorail systems.   I have a TV show, “the scannell agenda”  which I explain the system, but it’s mostly fishery work I discuss.  

The new “GREEN GRID” is for compressed air and hydrogen, and oxygen rich compressed air. 

Ed Dodge's picture
Ed Dodge on Jan 6, 2015 7:55 pm GMT

Natural gas fired co-gen has been very successful; economically, environmentally and operationally. Two examples: Cornell University replaced their century old coal fired steam plant, used to heat campus buildings, with a modern natural gas combined cycle system that not only provides heat but also power to the campus. The gas turbines are smaller, more efficient and easier to operate than the old coal boilers, and the system is integrated with local hydro and lake source cooling. Emissions slashed, reliability improved, and economics are better.

NYU’s campus in lower Manhattan also has a similar gas fired co-gen that remained operational throughout Hurricane Sandy when the rest of lower Manahttan went dark. NYU’s campus had heat and power and was able to provide much needed services to the entire neighborhood and even became a command center for emergency officials. 

Combined heat and power using natural gas is the leading edge for reliable, clean distributed energy that integrates perfectly with renewables and reduces stress on the power grid.

Bob Meinetz's picture
Bob Meinetz on Jan 6, 2015 9:29 pm GMT

Ed, Cornell uses 240GWh of electricity/year. Their cogen facility generates 3GWh, so its electrical contribution and stress reduction are minimal. Though CCGT gas has helped the university reduce its carbon footprint by 32% over six years, it still generates 200,000 metric tons of CO2e/year.

Their century-old steam tubing heating system loses about 16% of energy in transit. Would it not be more efficient to heat university buildings individually as needed, using modern gas furnaces (which are up to 97% efficient)?

Ed Dodge's picture
Ed Dodge on Jan 6, 2015 9:37 pm GMT

Bob, Cornell has dozens of buildings (not sure how many, but it is a big campus) connected to an existing steam infrastructure that works. Why abandon infrastructure when we can improve it? Installing individual furnaces would require expensive and intrusive retrofits on every building, and far more maintenance. The co-gen system they installed was a big improvement over what existed previously, and it made sense economically and operationally.

The easiest way to reduce the carbon emissions from the natural gas would be to raise the ratio of RNG used compared to fossil gas.

Rick Engebretson's picture
Rick Engebretson on Jan 6, 2015 10:33 pm GMT

Cogeneration (CHP) is a small but essential part of the modern automobile. Nice to see CHP has become an essential part of modern energy planning, too.

Clare Taylor's picture
Clare Taylor on Jan 7, 2015 8:59 am GMT

Great to see an engaged community here!

For the sake of brevity I did not clarify the distinction between district heating separate from cogeneration (in 2011, 79% of all district heating in OECD countries was produced by co‐generation plants – so usually but not always DH and co-gen are hand-in-hand).

Edward – definitely agree with you on why abandon infrastructure when we can improve it. Another great demonstrator project from CELCIUS delivers waste heat from an incinerator in the Port of Rotterdam 26 kilometers to the city where it connects to the existing district heating network. A heat hub, operational since late 2013 and located in the middle of the distribution network, acts as a distribution station and has a well-insulated buffering tank. The capacity of the buffer is 185MWh and the discharge capacity is 30MWth.This allows for an increase in total heat delivery of the heat network without any additional investments in a new transport infrastructure or by means of additional heat sources.

 WRT natural gas fired co-gen, there are major concerns about the vulnerability of the Baltic States to disruptions in natural gas supply from Russia. In Europe, on average 44% of district heating runs on gas with a share of up to 80% in the countries where district heating is well-established such as Latvia, Lithuania, Slovakia, Bulgaria and Hungary. In the Baltics and Finland, gas consumption in district heating and in combined heat and power plants typically represents around 50% of total gas consumption. So energy efficiency measures and enabling fuel switching (preferably to renewables such as biomass / biogas) for DH are high on the agenda.  

Of course I’m not suggesting this is a one-size-fits-all solution but I reckon it is an underexploited low carbon solution suitable for many applications. 

Bob Meinetz's picture
Bob Meinetz on Jan 7, 2015 4:59 pm GMT

Clare, what percentage of the heat makes the 26km trip from Rotterdam to the hub, then to where it can be used? What’s the energy expense incurred by pumping?

Dave Smart's picture
Dave Smart on Jan 8, 2015 10:08 am GMT

“Problem solved”: If only . . . 

The physics is simple: District heating – CHP is a more efficient use of the energy resource. It is a choice more often implemented by municipal utilities. It’s not a popular business choice, because it’s a long-term strategy. You’re right about electricity being a more versatile approach, but the problem is the last-century technology of thermal generation. That needs to be phased out and the quicker the better:-

“Death spiral” is an emotive term, but it is far from imaginary. Take the case of RWE. The declining profitability of their fossil fuel plants prompted the admission – “I grant we have made mistakes. We were late entering into the renewables market – possibly too late”.

UK government policy has been to favour new gas plant + fracking, but their business case doesn’t stack up. The new Pembroke CCGT station was allowed to (illegally) discharge waste heat into the environment, because a CHP plant would be even less commercially viable.

Oops – That was intended as a reply to Bob Meinetz

Bob Meinetz's picture
Bob Meinetz on Jan 9, 2015 4:56 pm GMT

Dave, the physics aren’t quite so simple. CHP is not always a more efficient use of the energy resource depending on a lot of other factors, including heat lost in transmission and resistance losses. Not everything which goes into one end of a 26-kilometer pipe comes out the other end.

I agree that part of the problem is the last-century technology of thermal generation (two nominal centuries ago, but who’s counting?). The other part is we have an entire generation of activists who are irrationally averse to the last century’s technology of nuclear generation. RWE’s lack of profitability is directly attributable to irrational fears of the German public, who show either remarkable courage or ignorance with regards to the health effects of coal emissions.

You won’t get any argument from me favoring new gas plants/fracking, except as a clear replacement to coal.

Nathan Wilson's picture
Nathan Wilson on Jan 9, 2015 5:58 am GMT

Bob, it makes sense that co-generation with electricity sharing would be popular, since it is “easier” to deploy such a system: industrial users of low-med temp steam can co-generate electricity, and sell it onto the grid as reduced carbon energy.

As you point out, co-generation with thermal energy sharing is harder; it requires plumbing infrastructure for transport of hot water.

However, if you consider the deep decarbonization challenge, how do you plan to heat the northern cities?  Heat demand obvious strongly peaks in the winter, when solar energy is nearly worthless.   If you power it with hydrocarbon fuel, you’ll fail on deep decarbonization (plus safety isn’t great).  If you power it with baseload electric power, you’ll get a lot of wasteful and expensive curtailment the rest of the year (pipelined hydrogen is also a baseload energy carrier, since it is poorly suited to seasonal energy storage except with very special geology).

You could do on-site boilers, powered by ammonia fuel, but this fuel will be as expensive as oil, hence I think it will mostly be used for transportation.  

Basically every other low-carbon option requires district heating: industrial waste heat, combined-heat-and-power from nuclear plants, combined-heat-and-power from fossil with CC&S, fossil fuel boilers with carbon capture, or biomass burning.  Even electric heat pumps require district heating when applied to dense urban areas.

Here’s a good report on district heating in the EU.  The great thing is that when a thermal power plant (such as a nuke) is designed to output waste heat at 100C instead of 35C, the electrical output is reduced by only about 1/8th the amount of heat output (i.e. it is twice as effective as a heat pump).

The EU report claims that heat loss is not a problem, even for long runs from the power-plant if the power is high.  They cite a study (p.84) for a 2 GWatt pipeline bringing heat to London from 140 km away; it had only 2% heat loss, and 2% pumping loss.

But as you expected, it doesn’t work as well outside of dense urban areas; the losses going to individual houses get much worse.  (But for individual houses, heat pumps work well).

Bob Meinetz's picture
Bob Meinetz on Jan 9, 2015 7:49 am GMT

Nathan,  Ed makes a good point about Cornell – if there is existing hot water/steam piping in place, by all means use it, and heat the water in the most environmental and economical way you can. But how much energy in Cornell’s system is diverted to make a very small amount of electricity?

An analogy: on a fairly regular basis, a baker gives a delivery boy a box of cookies to deliver on his bicycle. Too often, the box falls off the back of the bicycle, turning several of the cookies into crumbs. What are the baker’s options? One might be to insist the delivery boy return the crumbs, so the baker can take them home to feed to his chickens.

This idea appeals to us, because we’re taking something which would be wasted and finding a use for it. But the more efficient solution, the one which conserves instead of dissipates energy, is to devise a better way to carry the cookies so they don’t break at all. Similarly, making efficiency our energy goal is diametrically opposed to the goal of cogeneration, which requires us to be wasteful for it to make sense! If we have a well-engineered system, there isn’t enough “extra” energy to be useful.

Decarbonizing northern cities will be a challenge, but for new construction I don’t see district heating as being any more practical or less carbon-intensive than high-efficiency, forced-air gas heating (unless geothermal is available). Ultimately I believe nuclear electricity will play a large part in removing the fossil component. And curtailment needn’t be an issue if we can use off-season energy to synthesize methane or ammonia from ambient air.

onedit: the 2%/140km pumping loss is suspect, if only because pumped hydro max efficiency is ~80%, incurring the same losses to friction with a lot less pipe.

Bas Gresnigt's picture
Bas Gresnigt on Jan 12, 2015 10:37 am GMT

In NL ~30% of all electricity is generated by CHP installations. Mainly installations to heat the green houses. Almost all green houses have such installation now.
It is a success because those installations are almost in the greenhouse, so heat transport (losses) is the same as when using a boiler.

District heating is here at least half a century. Only few districts.  It has the name being expensive.

Recently a micro CHP for normal houses, intended to replace the boiler, entered the market (it has a Stirling pump). May be that has more chance.

Get Published - Build a Following

The Energy Central Power Industry Network is based on one core idea - power industry professionals helping each other and advancing the industry by sharing and learning from each other.

If you have an experience or insight to share or have learned something from a conference or seminar, your peers and colleagues on Energy Central want to hear about it. It's also easy to share a link to an article you've liked or an industry resource that you think would be helpful.

                 Learn more about posting on Energy Central »