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What is District Energy?


 

 

 

District energy systems produce steam, hot water or chilled water at a central plant. The steam, hot water or chilled water is then piped underground to individual buildings for space heating, domestic hot water heating and air conditioning. As a result, individual buildings served by a district energy system don't need their own boilers or furnaces, chillers or air conditioners. The district energy system does that work for them, providing valuable benefits including:
  • Improved energy efficiency 
  • Enhanced environmental protection
  • Fuel flexibility 
  • Ease of operation and maintenance 
  • Reliability 
  • Comfort and convenience for customers 
  • Decreased life-cycle costs 
  • Decreased building capital costs 
  • Improved architectural design flexibility


Improved energy efficiency. When steam, hot water or chilled water arrive at a customer's building, they are ready to use. They are 100 percent efficient "at the door," compared with 80 percent efficient or less when burning natural gas or fuel oil at a building. In addition, district energy systems can use the "reject heat" that results from burning fuel to produce electricity at a power plant, dramatically increasing the overall efficiency with which useful energy is extracted from the fuel.

The reject heat can be used to spin turbines and generate electricity. This arrangement, called "combined heat and power" (often referred to by the acronym "CHP") or "cogeneration" can produce both heating and cooling plus electricity for customers. A CHP system may have double the fuel efficiency of an electric generation plant and can also lower the emissions typically associated with conventional fossil-fuel powered electrical production. The less energy used, the less sulfur dioxide and carbon dioxide and other emissions are expelled into the environment.

  • Click here to see a graphic comparing the efficiency of CHP and electric power generating technologies.

Enhanced environmental protection. District energy enables building owners and managers to conserve energy, improve operating efficiency and protect the environment. With district energy, building managers no longer need to burn fuels or store or use refrigerants on site, so the site is safer and more environmentally sound - and does not need unsightly smokestacks. Instead, fuel and refrigerants are used at district energy plants. These systems employ stringent emission controls - more so than individual buildings - and this provides air-quality benefits.

Fuel flexibility. The beauty of a district energy system is that since it serves so many customers from one location, it can accomplish things individual buildings usually cannot. For instance, district energy systems can use a variety of conventional fuels such as coal, oil and natural gas, whichever fuel is most competitive at the time. And because of a district energy system’s size, the district energy plant can also transition to use renewable fuels such as various forms of biomass such as wood and food processing waste, geothermal heat, and combined heat and power.

Ease of operation and maintenance. District energy is worry-free heating and/or cooling delivered directly to a customer's building - ready to use. Customers do not need boilers or chillers, so there is less maintenance, monitoring and equipment permitting. And that allows occupants, rather than energy operations, to be the focus. District energy customers also eliminate the need for fuel deliveries, handling and storage so there are fewer safety and liability concerns for employees and building occupants. The use of district energy service frees up valuable building space by eliminating the need for mechanical rooms, freeing up space to meet tenant needs

Reliability. Building owners and managers can count on district energy systems since energy professionals operate around-the-clock and have backup systems readily available. Most district energy systems operate at a reliability of "five nines" (99.999 percent). To IDEA's knowledge, there have been no rolling "heat-outs" related to district energy systems.

Comfort and convenience for customers. District energy service allows building operators manage and control their own indoor environments. Building occupants can be both comfortable and satisfied, no matter what the outdoor temperature. District energy is available whenever a building needs heating or cooling. So even if there are unusually warm days in January, a building can receive chilled water or steam for air conditioning, without starting up its own chillers. In addition, district energy reduces vibrations and noise problems that could annoy building occupants.

Decreased life-cycle costs. Since buildings using district energy service don't need boilers or chillers, building owners and managers reduce their upfront capital requirements and their ongoing, operating, maintenance and labor costs considerably. That means less financial risk and a far better return on investment - plus the elimination of principal and interest payments, property taxes associated with new boiler and chiller installations, costly insurance and annual maintenance contracts, and costs associated with operating boilers and chillers. In addition, district energy systems have the flexibility to use a variety of fuel sources in larger, more economical volumes—from oil to natural gas to coal to biomass —reducing the impact of supply and price variations.

Decreased building capital costs. Buildings connected to district energy systems also have lower capital costs for their energy equipment because they don’t need conventional boilers and chillers. They save valuable upfront dollars they can invest elsewhere. Plus, they save building space that can be used for other more valuable purposes.

Architectural design flexibility. No boilers or furnaces and roofs free of smoke stacks and cooling towers means substantially greater building design flexibility. Architects can easily design or renovate buildings to be more versatile and aesthetically pleasing for both potential occupants and the community.

 

Fundamental Facts about District Energy

District Energy Fact Sheet

 

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