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Do liberalised electricity markets help or hinder CHP and district heating? The case of the UK

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  • Toke, David
  • Fragaki, Aikaterini
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    Abstract

    This paper investigates whether and how Danish-style combined heat and power (CHP) and district heating (DH) can be implemented in the UK in the context of a liberalised electricity market. There is currently an absence, in the UK, of the Danish system of planning rules and also good tariffs for CHP electricity exports to the grid that led to the development of the Danish system of CHP and DH. However, there are some changes in UK planning practice that may help CHP and DH. These would need to be strengthened, but it is also the case that the way the liberalised electricity market operates in the UK effectively discriminates against small CHP plant selling their electricity to the grid. A Danish system of 'aggregating' CHP-DH plant using thermal stores could help to overcome this problem. However, an alternative strategy would be to establish feed-in tariffs for CHP units that are linked to DH modelled on the Danish 'triple tariff'. This could help the UK's long-term objective of absorbing high levels of fluctuating renewable energy sources.

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    Bibliographic Info

    Article provided by Elsevier in its journal Energy Policy.

    Volume (Year): 36 (2008)
    Issue (Month): 4 (April)
    Pages: 1448-1456

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    Handle: RePEc:eee:enepol:v:36:y:2008:i:4:p:1448-1456

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    Web page: http://www.elsevier.com/locate/enpol

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    1. Dave Toke, 2005. "Are green electricity certificates the way forward for renewable energy? An evaluation of the United Kingdom’s Renewables Obligation in the context of international comparisons," Environment and Planning C: Government and Policy, Pion Ltd, London, vol. 23(3), pages 361-374, June.
    2. Mitchell, C. & Bauknecht, D. & Connor, P.M., 2006. "Effectiveness through risk reduction: a comparison of the renewable obligation in England and Wales and the feed-in system in Germany," Energy Policy, Elsevier, vol. 34(3), pages 297-305, February.
    3. Meyer, Niels I., 2003. "European schemes for promoting renewables in liberalised markets," Energy Policy, Elsevier, vol. 31(7), pages 665-676, June.
    4. Lund, Henrik & Munster, Ebbe, 2006. "Integrated energy systems and local energy markets," Energy Policy, Elsevier, vol. 34(10), pages 1152-1160, July.
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    Cited by:
    1. Taylor, Peter G. & Bolton, Ronan & Stone, Dave & Upham, Paul, 2013. "Developing pathways for energy storage in the UK using a coevolutionary framework," Energy Policy, Elsevier, vol. 63(C), pages 230-243.
    2. Morlet, Clémence & Keirstead, James, 2013. "A comparative analysis of urban energy governance in four European cities," Energy Policy, Elsevier, vol. 61(C), pages 852-863.
    3. Wittmann, Nadine & Yildiz, Özgür, 2013. "A microeconomic analysis of decentralized small scale biomass based CHP plants—The case of Germany," Energy Policy, Elsevier, vol. 63(C), pages 123-129.
    4. Toke, David, 2011. "UK Electricity Market Reform—revolution or much ado about nothing?," Energy Policy, Elsevier, vol. 39(12), pages 7609-7611.

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