IDEAS home Printed from https://ideas.repec.org/a/eee/appene/v194y2017icp715-724.html
   My bibliography  Save this article

District heating cost fluctuation caused by price model shift

Author

Listed:
  • Song, Jingjing
  • Wallin, Fredrik
  • Li, Hailong

Abstract

District Heating (DH) is considered as an efficient, environmentally friendly and cost-effective method for providing heat to buildings, and is playing an important role in the mitigation of climate change. Nowadays, Swedish DH companies are facing multiple challenges, and in urgent need for new price models to increase transparency and keep the competitiveness. In this paper, a survey is carried out to understand the structure of the present price models. Then, two restructured price models are proposed and compared with the price model most commonly used. To increase the transparency, price models should be based on users’ measured consumption profile; while to reduce the peak load, adoption of a pricing strategy based on a load demand component is an effective way. Consequently, users with flat consumption profiles will reduce cost, whereas users with steep consumption profiles will have a cost increase, both when charging the load demand cost based on the maximum daily or hourly peak load.

Suggested Citation

  • Song, Jingjing & Wallin, Fredrik & Li, Hailong, 2017. "District heating cost fluctuation caused by price model shift," Applied Energy, Elsevier, vol. 194(C), pages 715-724.
    • Handle: RePEc:eee:appene:v:194:y:2017:i:c:p:715-724
    DOI: 10.1016/j.apenergy.2016.09.073
    as

    Download full text from publisher

    File URL: http://www.sciencedirect.com/science/article/pii/S0306261916313757
    Download Restriction: Full text for ScienceDirect subscribers only
    File URL: https://libkey.io/10.1016/j.apenergy.2016.09.073?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    As the access to this document is restricted, you may want to search for a different version of it.

    References listed on IDEAS

    as
    1. Lund, Rasmus & Mathiesen, Brian Vad, 2015. "Large combined heat and power plants in sustainable energy systems," Applied Energy, Elsevier, vol. 142(C), pages 389-395.
    2. Sartor, K. & Quoilin, S. & Dewallef, P., 2014. "Simulation and optimization of a CHP biomass plant and district heating network," Applied Energy, Elsevier, vol. 130(C), pages 474-483.
    3. Liu, Jia-Bao & Pan, Xiang-Feng, 2015. "Asymptotic incidence energy of lattices," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 422(C), pages 193-202.
    4. A.M. Fogheri, 2015. "Energy Efficiency in Public Buildings," Rivista economica del Mezzogiorno, Società editrice il Mulino, issue 3-4, pages 763-784.
    5. Zhang, Junli & Ge, Bin & Xu, Hongsheng, 2013. "An equivalent marginal cost-pricing model for the district heating market," Energy Policy, Elsevier, vol. 63(C), pages 1224-1232.
    6. Marbe, Asa & Harvey, Simon, 2006. "Opportunities for integration of biofuel gasifiers in natural-gas combined heat-and-power plants in district-heating systems," Applied Energy, Elsevier, vol. 83(7), pages 723-748, July.
    7. Li, Hailong & Sun, Qie & Zhang, Qi & Wallin, Fredrik, 2015. "A review of the pricing mechanisms for district heating systems," Renewable and Sustainable Energy Reviews, Elsevier, vol. 42(C), pages 56-65.
    8. Difs, Kristina & Trygg, Louise, 2009. "Pricing district heating by marginal cost," Energy Policy, Elsevier, vol. 37(2), pages 606-616, February.
    Full references (including those not matched with items on IDEAS)

    Citations

    Citations are extracted by the CitEc Project, subscribe to its RSS feed for this item.
    as


    Cited by:

    1. Noussan, Michel & Jarre, Matteo & Roberto, Roberta & Russolillo, Daniele, 2018. "Combined vs separate heat and power production – Primary energy comparison in high renewable share contexts," Applied Energy, Elsevier, vol. 213(C), pages 1-10.
    2. Li, Haoran & Hou, Juan & Hong, Tianzhen & Nord, Natasa, 2022. "Distinguish between the economic optimal and lowest distribution temperatures for heat-prosumer-based district heating systems with short-term thermal energy storage," Energy, Elsevier, vol. 248(C).
    3. Li, Haoran & Hou, Juan & Hong, Tianzhen & Ding, Yuemin & Nord, Natasa, 2021. "Energy, economic, and environmental analysis of integration of thermal energy storage into district heating systems using waste heat from data centres," Energy, Elsevier, vol. 219(C).
    4. Paiho, Satu & Saastamoinen, Heidi, 2018. "How to develop district heating in Finland?," Energy Policy, Elsevier, vol. 122(C), pages 668-676.
    5. Guo, Xiaodan & Xiao, Bowen, 2022. "How can pricing strategy for district heating help China realize cleaner residential heating?," Energy Economics, Elsevier, vol. 110(C).
    6. Hou, Juan & Li, Haoran & Nord, Natasa, 2022. "Nonlinear model predictive control for the space heating system of a university building in Norway," Energy, Elsevier, vol. 253(C).
    7. Sernhed, Kerstin & Lygnerud, Kristina & Werner, Sven, 2018. "Synthesis of recent Swedish district heating research," Energy, Elsevier, vol. 151(C), pages 126-132.
    8. Lin, Jing & Lin, Boqiang, 2018. "Heat tariff and subsidy in China based on heat cost analysis," Energy Economics, Elsevier, vol. 71(C), pages 411-420.
    9. Hou, Juan & Li, Haoran & Nord, Natasa & Huang, Gongsheng, 2023. "Model predictive control for a university heat prosumer with data centre waste heat and thermal energy storage," Energy, Elsevier, vol. 267(C).
    10. Wang, Chao & Du, Yuyan & Li, Hailong & Wallin, Fredrik & Min, Geyong, 2019. "New methods for clustering district heating users based on consumption patterns," Applied Energy, Elsevier, vol. 251(C), pages 1-1.
    11. Danica Djurić Ilić, 2020. "Classification of Measures for Dealing with District Heating Load Variations—A Systematic Review," Energies, MDPI, vol. 14(1), pages 1-27, December.
    12. Dodoo, Ambrose & Gustavsson, Leif & Le Truong, Nguyen, 2018. "Primary energy benefits of cost-effective energy renovation of a district heated multi-family building under different energy supply systems," Energy, Elsevier, vol. 143(C), pages 69-90.
    13. Qingyou Yan & Chao Qin, 2017. "Environmental and Economic Benefit Analysis of an Integrated Heating System with Geothermal Energy—A Case Study in Xi’an China," Energies, MDPI, vol. 10(12), pages 1-16, December.
    14. Arnaudo, Monica & Dalgren, Johan & Topel, Monika & Laumert, Björn, 2021. "Waste heat recovery in low temperature networks versus domestic heat pumps - A techno-economic and environmental analysis," Energy, Elsevier, vol. 219(C).
    15. Dorotić, Hrvoje & Pukšec, Tomislav & Duić, Neven, 2019. "Multi-objective optimization of district heating and cooling systems for a one-year time horizon," Energy, Elsevier, vol. 169(C), pages 319-328.
    16. Li, Haoran & Hou, Juan & Tian, Zhiyong & Hong, Tianzhen & Nord, Natasa & Rohde, Daniel, 2022. "Optimize heat prosumers' economic performance under current heating price models by using water tank thermal energy storage," Energy, Elsevier, vol. 239(PB).

    Most related items

    These are the items that most often cite the same works as this one and are cited by the same works as this one.
    1. Lin, Jing & Lin, Boqiang, 2018. "Heat tariff and subsidy in China based on heat cost analysis," Energy Economics, Elsevier, vol. 71(C), pages 411-420.
    2. Moser, Simon & Puschnigg, Stefan & Rodin, Valerie, 2020. "Designing the Heat Merit Order to determine the value of industrial waste heat for district heating systems," Energy, Elsevier, vol. 200(C).
    3. Mazhar, Abdur Rehman & Liu, Shuli & Shukla, Ashish, 2018. "A state of art review on the district heating systems," Renewable and Sustainable Energy Reviews, Elsevier, vol. 96(C), pages 420-439.
    4. Guo, Xiaodan & Xiao, Bowen, 2022. "How can pricing strategy for district heating help China realize cleaner residential heating?," Energy Economics, Elsevier, vol. 110(C).
    5. Leurent, Martin & Jasserand, Frédéric & Locatelli, Giorgio & Palm, Jenny & Rämä, Miika & Trianni, Andrea, 2017. "Driving forces and obstacles to nuclear cogeneration in Europe: Lessons learnt from Finland," Energy Policy, Elsevier, vol. 107(C), pages 138-150.
    6. Danica Djurić Ilić, 2020. "Classification of Measures for Dealing with District Heating Load Variations—A Systematic Review," Energies, MDPI, vol. 14(1), pages 1-27, December.
    7. Shin, Kong Joo & Managi, Shunsuke, 2017. "Liberalization of a retail electricity market: Consumer satisfaction and household switching behavior in Japan," Energy Policy, Elsevier, vol. 110(C), pages 675-685.
    8. 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.
    9. Lygnerud, Kristina & Ottosson, Jonas & Kensby, Johan & Johansson, Linnea, 2021. "Business models combining heat pumps and district heating in buildings generate cost and emission savings," Energy, Elsevier, vol. 234(C).
    10. Parkhurst, Kristen M. & Saffron, Christopher M. & Miller, Raymond O., 2016. "An energy analysis comparing biomass torrefaction in depots to wind with natural gas combustion for electricity generation," Applied Energy, Elsevier, vol. 179(C), pages 171-181.
    11. Gao, Shuang & Jurasz, Jakub & Li, Hailong & Corsetti, Edoardo & Yan, Jinyue, 2022. "Potential benefits from participating in day-ahead and regulation markets for CHPs," Applied Energy, Elsevier, vol. 306(PA).
    12. Truong, Nguyen Le & Gustavsson, Leif, 2014. "Minimum-cost district heat production systems of different sizes under different environmental and social cost scenarios," Applied Energy, Elsevier, vol. 136(C), pages 881-893.
    13. Li, Hailong & Sun, Qie & Zhang, Qi & Wallin, Fredrik, 2015. "A review of the pricing mechanisms for district heating systems," Renewable and Sustainable Energy Reviews, Elsevier, vol. 42(C), pages 56-65.
    14. Cai, Hanmin & Ziras, Charalampos & You, Shi & Li, Rongling & Honoré, Kristian & Bindner, Henrik W., 2018. "Demand side management in urban district heating networks," Applied Energy, Elsevier, vol. 230(C), pages 506-518.
    15. Diana Korsakaite & Darius Bieksa & Egle Bieksiene, 2018. "Third-party access in district heating: Lithuanian case analysis," Competition and Regulation in Network Industries, , vol. 19(3-4), pages 218-241, September.
    16. Fang, Tingting & Lahdelma, Risto, 2015. "Genetic optimization of multi-plant heat production in district heating networks," Applied Energy, Elsevier, vol. 159(C), pages 610-619.
    17. Yu Dong & Tongyu Qin & Siyuan Zhou & Lu Huang & Rui Bo & Haibo Guo & Xunzhi Yin, 2020. "Comparative Whole Building Life Cycle Assessment of Energy Saving and Carbon Reduction Performance of Reinforced Concrete and Timber Stadiums—A Case Study in China," Sustainability, MDPI, vol. 12(4), pages 1-24, February.
    18. Lund, Henrik & Thellufsen, Jakob Zinck & Sorknæs, Peter & Mathiesen, Brian Vad & Chang, Miguel & Madsen, Poul Thøis & Kany, Mikkel Strunge & Skov, Iva Ridjan, 2022. "Smart energy Denmark. A consistent and detailed strategy for a fully decarbonized society," Renewable and Sustainable Energy Reviews, Elsevier, vol. 168(C).
    19. Eid Gul & Giorgio Baldinelli & Pietro Bartocci, 2022. "Energy Transition: Renewable Energy-Based Combined Heat and Power Optimization Model for Distributed Communities," Energies, MDPI, vol. 15(18), pages 1-18, September.
    20. Christoph J.W. Kirmse & Oyeniyi A. Oyewunmi & Andrew J. Haslam & Christos N. Markides, 2016. "Comparison of a Novel Organic-Fluid Thermofluidic Heat Converter and an Organic Rankine Cycle Heat Engine," Energies, MDPI, vol. 9(7), pages 1-26, June.

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:eee:appene:v:194:y:2017:i:c:p:715-724. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    If CitEc recognized a bibliographic reference but did not link an item in RePEc to it, you can help with this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Catherine Liu (email available below). General contact details of provider: http://www.elsevier.com/wps/find/journaldescription.cws_home/405891/description#description .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.