Is District Heating Combined Heat and Power at Risk in the Nordic Area?—An Electricity Market Perspective

Research output: Contribution to journalArticleScientificpeer-review

Researchers

Research units

  • Aalborg University

Abstract

The Nordic power market has exceptionally low carbon emissions. Energy efficient combined heat and power (CHP) plays an important role in the market, and also produces a large share of Nordic district heating (DH) energy. In future Nordic energy systems, DH CHP is often seen as vital for flexibility in electricity production. However, CHP electricity production may not be profitable in the future Nordic market. Even currently, the prevailing trend is for CHP plants to be replaced with heat-only boilers in DH production. In this work, we aim to describe the future utilisation of CHP in the Nordic area. We use an electricity market simulation model to examine the development of the Nordic electricity market until 2030. We examine one main projection of electricity production capacity changes, and based on it we assess scenarios with different electricity demands and CO2 emission prices. Differences between scenarios are notable: For example, the stalling or increasing of electricity demand from the 2014 level can mean a difference of 15 €/MWh in the average market price of electricity in 2020. The results of this paper underline the importance of considering several alternative future paths of electricity production and consumption when designing new energy policies.

Details

Original languageEnglish
Number of pages19
JournalEnergies
Volume11
Issue number5
Publication statusPublished - 14 May 2018
MoE publication typeA1 Journal article-refereed

    Research areas

  • electricity market, CHP, district heating, energy market modelling, variable renewable energy, energy policy

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