Making Combined Heat and Power District Heating(CHP-DH) networks in the United Kingdom economically viable: a comparative approach

Scott Kelly and Michael Pollitt

Cambridge Working Papers in Economics from Faculty of Economics, University of Cambridge

Abstract: As global fuel reserves are depleted, alternative and more efficient forms of energy generation and delivery will be required. Combined Heat and Power with District Heating (CHP-DH) provides an alternative energy production and delivery mechanism that is less resource intensive, more energy efficient and provides greater energy security than many popular alternatives. This article presents a comparative analysis between several operational CHP-DH networks across the UK, these include: Aberdeen, Barkantine, Woking, Southampton, Nottingham and Sheffield. It will be shown that the economic viability of CHP-DH networks depends on several factors, namely: (1) the optimisation of engineering and design principles; (2) organisational and regulatory frameworks, and finally; (3) financial and economic factors. It was found that in the long term DH is competitive with other energy supply and distribution technologies such as electricity and gas. However, in the short to medium term it is shown that economic risk, regulatory uncertainty and lock-in of existing technology are the most significant barriers to the implemention of CHP-DH networks.

Keywords: ESCO; Combined Heat and Power (CHP); Co-generation Energy Service Company; District Heating; Community Heating; Renewable Energy; Energy Efficiency; Private Wire Network (PWN) (search for similar items in EconPapers)
Date: 2009-11-13
New Economics Papers: this item is included in nep-ene
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Citations: View citations in EconPapers (4)

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Related works:
Working Paper: Making Combined Heat and Power District Heating (CHP-DH) Networks in the United Kingdom Economically Viable: A Comparative Approach (2009)
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Persistent link: https://EconPapers.repec.org/RePEc:cam:camdae:0945

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