Although viable techniques for utilizing industrial surplus heat already exist, a mere fraction of the latent potential is currently used. The EU-project So What is working on a digital tool to facilitate collaboration between industry and energy companies and has delivered two reports on how to create business models and overcome obstacles to take advantage of these energy flows.
– The reports address preconditions for using industrial waste heat in the various European countries in our purview. They provide a unique insight into how people think in industries in these countries and are a prerequisite for moving forward with different solutions, says Sofia Klugman, project manager at IVL Swedish Environmental Research Institute.
Industrial surplus heat in the EU has an estimated potential of 300 TWh per year. This corresponds to about ten per cent of the total heating demand for housing across the EU. The greatest potential for excess heat is to be found in the steel industry.
The project includes demonstration sites in Romania, Spain, Portugal, Italy, Belgium and England, as well as a so-called lighthouse cluster in Sweden which consists of Göteborgs energi and Varbergs energi. These sites have contributed with good examples of practical solutions, both technically and commercially.
Based on this input, IVL, which is responsible for developing business models for the demo sites, has listed common obstacles that stand in the way of residual heat cooperation. One of the reports shows how agreements can be designed to overcome these. For example, one of these obstacles is the high investment costs for pipelines and other technologies incurred at the beginning of a collaborative project.
– It is crucial to be able to demonstrate an economic model in which all the parties involved benefit, and where they also are provided with long-term security through the agreements they sign up for. We want to highlight business arrangements that can be used when the partners have completely different requirements for payoff time, is often the case when the contracting parties are both privately and publicly owned, says Sofia Klugman.
Sometimes it is difficult for companies invest outside their core business. In this case they may need to involve a third party, e.g., an energy company able to assume responsibility for the design and operation of the heating or cooling network and other related equipment.
From a European perspective, this is also very much about increasing understanding of the various stakeholder systems in order to move forward with solutions. So What embraces 20 partners in nine countries. Among them, only Sweden and Romania already have some form of district heating infrastructure, but even in these two countries, district cooling is scantily implemented although it has great potential.
– In the countries where this infrastructure is lacking, the challenges are even greater. Here there is often a lack of both a regulatory framework and local expertise for laying pipelines. A new way of thinking about business arrangements may also be needed when there is no major district heating player in the equation. For several of the demo sites in the project, it is also a question of delivering heat and cooling to big individual customers, such as hospitals or airports, rather than targeting urban development, says Sofia Klugman.
From a European perspective, Sweden is unique because we are not dependent on natural gas, like many other countries. Sweden is also a world leader when it comes to using industrial surplus heat. Eight per cent of Sweden's heating needs are supplied in this way. In other countries, competition with low natural gas prices may make it difficult to introduce alternative forms of heating, even if there is a political will to become less dependent on natural gas.
The So What initiative is now attempting to identify risks associated with business plans, carry out cost and benefit analyses for the demo sites and proposals as to how business plans can be integrated into a digital tool that is under development.
The reports can be downloaded here
For more information, please contact:
Sofia Klugman, email@example.com, +46(0)10-788 67 17
So What spans demonstration sites in six countries: In Sweden, the Värö pulp mill in Varberg and the Preem and ST1 refineries in Gothenburg. In Spain, a pulp mill, in Portugal, a waste incineration plant, in Italy, a distillery, in Belgium, a chemical industry, materials recycling and incineration, in England, the steel industry and in Romania a refinery and smaller local industries such as a bakery and a building materials manufacturer.