Consequences of consumer-binding in district heating

In Denmark, the production of district heating is split between more than 400 distribution companies that deliver district heating to around 64% of Danish households. The government wishes to modernise the heating sector in Denmark, to allow for a greater freedom of choice in the type of heating, for both the consumers and the district heating plants.

Based on the the energy agreement of June 2018 and the government’s supply strategy from 2016, the Danish Energy Agency has started a number of analyses of the consequences of modernising the collective heat supply. Ea has, with aid from Grøn Energi, delivered a report with the following input to these analyses:

• A developed and quality assured data and analytical framework for assessment of the consequences of no longer having mandatory connection to district heating and natural gas
• Mapping of non-economic factors having an influence on the choice of heating source for the consumers
• An estimate of the consequences of removing area limits for district heating and natural gas and of removing the ban for electric heating, in a scenario where all other production and consumer bindings have been removed, as well as the removal of the obligation to prove a positive socio-economy before the approval of a project. Here, non-economic factors are also included.

The project ran from June to December 2018