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An assessment of the present and future opportunities for combined heat and power with district heating (CHP-DH) in the United Kingdom


  • Kelly, Scott
  • Pollitt, Michael


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 efficient and provides greater energy security than many popular alternatives. It will be shown that the economic viability of CHP-DH networks depends on several principles, namely (1) the optimisation of engineering and design principles; (2) organisational and regulatory frameworks; (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 CHP-DH development. This research suggests that under the present regulatory and economic paradigm, the infrastructure required for DH networks remains financially prohibitive; the implementation of government policies are complicated and impose high transaction costs, while engineering solutions are frequently not implemented or economically optimised. If CHP-DH is going to play any part in meeting climate change targets then collaboration between public and private organisations will be required. It is clear from this analysis that strong local government involvement is therefore necessary for the co-ordination, leadership and infrastructural deployment of CHP-DH.

Suggested Citation

  • Kelly, Scott & Pollitt, Michael, 2010. "An assessment of the present and future opportunities for combined heat and power with district heating (CHP-DH) in the United Kingdom," Energy Policy, Elsevier, vol. 38(11), pages 6936-6945, November.
  • Handle: RePEc:eee:enepol:v:38:y:2010:i:11:p:6936-6945

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    References listed on IDEAS

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    2. Sayegh, M.A. & Danielewicz, J. & Nannou, T. & Miniewicz, M. & Jadwiszczak, P. & Piekarska, K. & Jouhara, H., 2017. "Trends of European research and development in district heating technologies," Renewable and Sustainable Energy Reviews, Elsevier, vol. 68(P2), pages 1183-1192.
    3. Rees, M.T. & Wu, J. & Jenkins, N. & Abeysekera, M., 2014. "Carbon constrained design of energy infrastructure for new build schemes," Applied Energy, Elsevier, vol. 113(C), pages 1220-1234.
    4. Cho, Woojin & Lee, Kwan-Soo, 2014. "A simple sizing method for combined heat and power units," Energy, Elsevier, vol. 65(C), pages 123-133.
    5. Sun, Jian & Fu, Lin & Sun, Fangtian & Zhang, Shigang, 2014. "Study on a heat recovery system for the thermal power plant utilizing air cooling island," Energy, Elsevier, vol. 74(C), pages 836-844.
    6. Connolly, D. & Lund, H. & Mathiesen, B.V. & Werner, S. & Möller, B. & Persson, U. & Boermans, T. & Trier, D. & Østergaard, P.A. & Nielsen, S., 2014. "Heat Roadmap Europe: Combining district heating with heat savings to decarbonise the EU energy system," Energy Policy, Elsevier, vol. 65(C), pages 475-489.
    7. Riesz, Jenny & Vithayasrichareon, Peerapat & MacGill, Iain, 2015. "Assessing “gas transition” pathways to low carbon electricity – An Australian case study," Applied Energy, Elsevier, vol. 154(C), pages 794-804.
    8. Gabillet, Pauline, 2015. "Energy supply and urban planning projects: Analysing tensions around district heating provision in a French eco-district," Energy Policy, Elsevier, vol. 78(C), pages 189-197.
    9. Lund, Henrik & Werner, Sven & Wiltshire, Robin & Svendsen, Svend & Thorsen, Jan Eric & Hvelplund, Frede & Mathiesen, Brian Vad, 2014. "4th Generation District Heating (4GDH)," Energy, Elsevier, vol. 68(C), pages 1-11.
    10. Davide Borelli & Francesco Devia & Margherita Marré Brunenghi & Corrado Schenone & Alessandro Spoladore, 2015. "Waste Energy Recovery from Natural Gas Distribution Network: CELSIUS Project Demonstrator in Genoa," Sustainability, MDPI, Open Access Journal, vol. 7(12), pages 1-17, December.
    11. Kelly, S. & Pollitt, M. & Crawford-Brown, D., 2012. "Building performance evaluation and certification in the UK: a critical review of SAP?," Cambridge Working Papers in Economics 1238, Faculty of Economics, University of Cambridge.
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    13. Pantaleo, Antonio & Candelise, Chiara & Bauen, Ausilio & Shah, Nilay, 2014. "ESCO business models for biomass heating and CHP: Profitability of ESCO operations in Italy and key factors assessment," Renewable and Sustainable Energy Reviews, Elsevier, vol. 30(C), pages 237-253.
    14. repec:oup:renvpo:v:12:y:2018:i:1:p:183-189. is not listed on IDEAS
    15. Colmenar-Santos, Antonio & Rosales-Asensio, Enrique & Borge-Diez, David & Mur-Pérez, Francisco, 2015. "Cogeneration and district heating networks: Measures to remove institutional and financial barriers that restrict their joint use in the EU-28," Energy, Elsevier, vol. 85(C), pages 403-414.
    16. Hannon, Matthew J. & Bolton, Ronan, 2015. "UK Local Authority engagement with the Energy Service Company (ESCo) model: Key characteristics, benefits, limitations and considerations," Energy Policy, Elsevier, vol. 78(C), pages 198-212.
    17. Lake, Andrew & Rezaie, Behanz & Beyerlein, Steven, 2017. "Review of district heating and cooling systems for a sustainable future," Renewable and Sustainable Energy Reviews, Elsevier, vol. 67(C), pages 417-425.
    18. Davide Borelli & Francesco Devia & Ermanno Lo Cascio & Corrado Schenone & Alessandro Spoladore, 2016. "Combined Production and Conversion of Energy in an Urban Integrated System," Energies, MDPI, Open Access Journal, vol. 9(10), pages 1-17, October.
    19. Kelly, Scott & Crawford-Brown, Doug & Pollitt, Michael G., 2012. "Building performance evaluation and certification in the UK: Is SAP fit for purpose?," Renewable and Sustainable Energy Reviews, Elsevier, vol. 16(9), pages 6861-6878.
    20. Athawale, Rasika & Felder, Frank A., 2014. "Incentives for Combined Heat and Power plants: How to increase societal benefits?," Utilities Policy, Elsevier, vol. 31(C), pages 121-132.
    21. Howard, B. & Modi, V., 2017. "Examination of the optimal operation of building scale combined heat and power systems under disparate climate and GHG emissions rates," Applied Energy, Elsevier, vol. 185(P1), pages 280-293.
    22. Ambrose, Aimee & Eadson, Will & Pinder, James, 2016. "The role of actor-networks in the early stage mobilisation of low carbon heat networks," Energy Policy, Elsevier, vol. 96(C), pages 144-152.


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