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District Heating and Cooling in the United States Prospects and Issues Committee on District Heating and Cooling Energy Engineering Board and Building Research Board Commission on Engineering and Technical Systems National Research Council NATIONAL ACADEMY PRESS Washington, D.C. 1985

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National Academy Press 2101 Constitution Ave., NW Washington' DC 20418 NOTICE: The project that is the subject of this report was approved by the Governing Board of the National Research Council, whose members are drawn from the councils of the National Academy of Sciences, the National Academy of Engineering, and the Institute of Medicine. The members of the committee responsible for the report were chosen for their special competencies and with regard for appropriate balance. This report has been reviewed by a group other than the authors according to procedures approved by a Report Review Committee consisting of members of the National Academy of Sciences, the National Academy of Engineering, and the Institute of Medicine. The National Research Council was established by the National Academy of Sciences in 1916 to associate the broad community of science and technology with the Academy's purposes of furthering knowledge and of advising the federal government. The Council operates in accordance with general policies determined by the Academy under the authority of its congressional charter of 1863, which establishes the Academy as a private, nonprofit, self-governing membership corporation. The Council has become the principal operating agency of both the National Academy of Sciences and the National Academy of Engineering in the conduct of their services to the government, the public, and the scientific and engineering communities. It is administered jointly by both Academies and the Institute of Medicine. The National Academy of Engineering and the Institute of Medicine were established in 1964 and 1970, respectively, under the charter of the National Academy of Sciences. This study was supported by contract No. HG 5682 between the National Academy of Sciences and the U.S. Department of Housing and Urban Development, U.S. Department of Energy, Royal Swedish Academy of Engineering Sciences, French Agency for Energy Man- agement, and Danish Ministry of Energy. . Library of Congress Catalog Card Number 85-60286 International Standard Book Number 0-309-03537-6 Printed in the United States of America

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Committee on District Heating and Cooling DAVID O. MEEKER, IR. (Chairman), Architect and Planner (formerly Executive Vice- President, American Institute of Architects), Washington, D.C. LARS ASTRAND (Cochairman), President, Uppsala Kraftvarme AB, Uppsala, Sweden ROBERT C. EINSWEILER, Professor and Director, Planning Program, Hubert H. Humphrey :Institute of Public Affairs, University of Minnesota, Minneapolis, Minnesota ARTHUR HAUSPURG, Chairman and Chief Executive Officer, Consolidated Edison Com- pany of New York, New York, New York ALAN HILLS, Managing Director, First Interstate Bancorp, Corte Madera, California ISHAI OLIKER, Manager, Renewable Energy Technologies, Burns and Roe, Oradell, New Jersey CLINTON W. PHILLIPS, Engineering Consultant (formerly President, American Society of Heating, Refrigeration, and Air Conditioning Engineers), OIney, Maryland LEE SCHIPPER, Staff Scientist, Lawrence Berkeley Laboratory, Berkeley, California MICHAEL l. ZIMMER, Partner, Wickwire, Gavin & Gibbs, P.C., Washington, D.C. Technical Advisor WILLIAM HANSELMAN, President, Resource Development Associates, Dayton, Ohio Staff DENNIS F. MILLER, Study Director JOHN P. EBERHARD, Executive Director, Building Research Board JEFFREY P. COHN, Consultant MICHAEL GAFFEN, Staff Officer, Committee on District Heating and Cooling (untiT Septem- ber 1, 1984) REGINA F. DEAN, Administrative Secretary CHERYL A. WOODWARD, Administrative Assistant -

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Energy Engineering Board HERBERT H. WOODSON (Chairman), Ernest H. Cockrell Centennial Professor of Engineer- ing, The University of Texas at Austin, Austin, Texas ALLAN l. BARD, Norman Hackerman Professor of Chemistry, The University of Texas at Austin, Austin, Texas ROBERT l. BUDNITZ, President, Future Resources Associates, Berkeley, California THELMA ESTRIN, Assistant Dean, School of Engineering and Applied Science, University of California, Los Angeles, California NICHOLAS I. GRANT, Professor of Materials Science and Engineering, Massachusetts In- stitute of Technology, Cambridge, Massachusetts BRUCE H. HANNON, Department of Geo~ranhv. Universilv of Illinois at I Jrh~n~- Champaign, Urbana, Illinois - Cal- --I --I ~ GARY H. HEICHEL, Plant Physiologist and Professor of Agronomy, University of Minneso- ta, St. Paul, Minnesota EDWARD A. MASON, Vice-President, Research, Standard Oil Company (Indiana), Amoco Research Center, Naperville, Illinois ALAN D. PASTERNAK, Energy Consultant, Sacramento, California DAVID l. ROSE, Professor of Nuclear Engineering, Massachusetts Institute of Technology, Cambridge, Massachusetts ADEL F. SAROFIM, Professor of Chemical Engineering, Massachusetts Institute of Technol- ogy, Cambridge, Massachusetts MELVIN K. SIMMONS, Corporate Research and Development, General Electric Company, Schenectady, New York WESTON M. STACEY, JR., Caliaway Professor of Nuclear Engineering, Georgia Institute of Technology, Atlanta, Georgia THOMAS E. STELSON, Vice-President for Research, Georgia Institute of Technology, AtIan- ta, Georgia LEON STOCK, Professor of Chemistry, University of Chicago GRANT P. THOMPSON, Senior Associate, The Conservation Foundation, Washington, D.C. GEORGE S. TOLLEY, Professor, Department of Economics, University of Chicago RICHARD WILSON, Mallinckrobt Professor of Physics and Chairman of the Department, Harvard University, Cambridge, Massachusetts 1V

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Technical Advisory Panel HAROLD M. AGNEW, President, GA Technologies, San Diego, California FLOYD L. CULLER, JR., President, Electric Power Research Institute, Palo Alto, California MICHAEL T. HALBOUTY, Consulting Geologist and Petroleum Engineer, Houston, Texas GEORGE F. MECHLIN, Vice-President, Research and Development, Westinghouse Electric Corporation, Pittsburgh, Pennsylvania CHAUNCEY STARR, Vice-Chairman, Electric Power Research Institute, Palo Alto, Califor- n~a Staff DENNIS F. MILLER, Executive Director HELEN D. JOHNSON, Staff Associate v

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Building Research Board PHILIP G. HAMMER (Chairman), Retired Consultant, Edgewater, Maryland WERNER A. BAUM, Dean, College of Arts and Sciences, Florida State University, TalIahas- see, Florida IRVING BLUESTONE, University Professor of Labor Studies, Wayne State University, De- troit, Michigan ROBERT C. DOBAN, Senior Vice-President, Science and Technology, Owens Fiberglass Corporation, Toledo, Ohio EZRA D. EHRENKRANTZ, President, The Ehrenkrantz Group, New York, New York HAROLD B. FINGER, President and Chief Executive Officer, U.S. Committee for Energy Awareness, Washington, D.C. DENOS C. GAZIS, Assistant Director, Semiconductor Science and Technology, IBM Re- search Center, Yorktown Heights, New York GEORGE S. TENONS, President, Consultation Networks, Washington, D.C. JOHN T. JOYCE, President, International Union of Bricklayers and Allied Craftsmen, Washington, D.C. WILLIAM LE MESSURIER, President, TSC Corporation, Cambridge, Massachusetts ROBERT P. MARSHALL, JR., Retired Consultant, Turner Construction Company, Cos Cob, Connecticut MELVIN A. MISTER, Vice-President, Citicorp, New York, New York DOUGLAS C. MOORHOUSE, President and Chief Executive Officer, Woodward-Clyde Con- sultants, San Francisco, California C. E. (TED) PECK, Chairman of the Board, The Ryland Group, Columbia, Maryland LLOYD RODWIN, Professor, Urban Studies and Planning, Massachusetts Institute of Tech- nology, Cambridge, Massachusetts LOUIS A. ROSSETTI, President, Rossetti Associates, Detroit, Michigan GEORGE STERNLIEB, Center for Urban Policy Research, New Brunswick, New Jersey RALPH WIDNER, Executive Director, Greater Philadelphia First, Philadelphia, Pennsylva- n~a RICHARD BENDER, Dean, College of Environmental Design, University of California, Ber- keley, California ROBERT L. SMITH, Professor of Civil Engineering, University of Kansas, Lawrence, Kansas Staff JOHN P. EBERHARD, Executive Director V1

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Preface This report is based in part on the International Symposium on District Heating and Cooling conducted by the National Academy of Sciences in Washington, D. C., June 4 through 6, 1984. The symposium and this report respond to requests from the U.S. Department of Housing and Urban Development (HUD) and the U.S. Department of Energy (DOE) for a study of district heating and cooling. In particular, the departments wanted a study of the rela- tionships between, on the one hand, explicit national goals and policies for decreasing dependence on oil, reducing energy costs, and achieving greater energy conservation, and, on the other, the growth of multifueled, low-cost, hot water district heating systems in Europe. Support for this study came from DOE and HUD, the Swedish Council for Building Research, the French Agency for Energy Management, and the Danish Ministry of Energy. With the cosponsorship of the Royal Swedish Academy of Engineering Sciences, the National Academy of Sciences created a Committee on District Heating and Cooling. The committee operated under the National Research Council's Energy Engineering Board and the Building Research Board. Specifically, the committee was given the following charges: o Identify new and innovative district heating and cooling technologies and implementa- tion designs that could penetrate key markets. o Evaluate the extent of current district heating and cooling in Europe and North America, the related marketplace and energy policy changes occurring in the same countries since 1973, and the technological developments that these changes created. O Identify the institutional and financial barriers to district heating and cooling in North America and the lessons that related European experience suggests. O Review innovative institutional and financing schemes that have resulted in wider use o district heating in Europe and assess their potential use in North America. O Assess the economics of district heating and cooling systems, including the costs of implemented systems, and their benefits, from the creation of jobs to the value of reduced dependence on imported petroleum. 0 Establish the basis for exchanges of information among nations involved in the sympo- sium. This report analyzes the papers submitted and discussions held at the symposium. No attempt was made to summarize the papers directly since they were published as part of the ~ V11

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symposium proceedings.* The most important ideas from the symposium were used by the committee in developing its findings, conclusions, and recommendations. In addition, the report reflects information gathered by the committee during its visits to district heating and cooling sites in the United States and in several European countries. At each site the committee was briefed by local government officials and system operators. The committee used its site visits to learn more about how district heating and cooling systems operate and the reasons for their success or lack of it. Finally, the committee gathered information on district heating and cooling during brief- ings from HUD, DOE, and other government officials, and by analyzing numerous printed and unpublished sources. Throughout its study the committee encountered difficulties in determining the actual extent of district heating and cooling in the United States. Until recently, no data existed on the miles of piping or amount of energy delivered. The data that can be found are often incomplete or unconfirmed. Thus, much of the material contained in this report is, of necessity, anecdotal. By design, this is not a technical report. As the text points out, the technology for district heating and cooling is well understood by engineers and architects. While discussing how the technology works, the report focuses on the policy issues that influence how and whether district heating and cooling will extend its share of the energy market. More technical discussions can be found in the appendixes. Appendix A contains case studies on eight U.S. cities, most of which are based on papers presented at the symposium. The case studies were chosen to show the diversity of technical approaches, institutional arrangements, kinds of municipal leadership, and uses of existing energy infrastructures in creating new or expanding older district heating and cooling systems. Appendix D contains the technical assessment done for Baltimore, Maryland. It is included to illustrate the kind of technical planning and analysis required. It is not intended to be a manual for developing a district heating and cooling system. While this report is addressed to the study's sponsors, the committee hopes that the report will be read widely by officials in state and local governments, public and investor-owned utilities, and the financial community, as well as by planners, developers, and equipment manufacturers and operators. The success of district heating and cooling will depend largely on their actions. In developing this report, the committee consulted with district heating and cooling experts and government officials in the United States, Sweden, Denmark, Finland, France, West Germany, Iceland, Italy, Canada, the Netherlands, and Great Britain. These and other individuals gave very generously of their time and knowledge. The committee is particularly grateful to the staff of the North American District Heating and Cooling Institute for their generous help, especially in arranging and conducting a tour of district heating and cooling facilities in the Washington, D.C., metropolitan area. The committee would also like to thank Dennis Miller, study director and executive director of the Energy Engineering Board, for organizing and guiding this effort, and Michael Gaffen, staff officer, and Jeffrey P. Cohn, consultant, for their assistance. The committee appreciates the cooperation and assistance of John Eberhard, executive director of the Building Research Board, and members of the board. Finally, the committee thanks Helen Johnson, Regina Dean, Cheryl Woodward, Julia Torrence, and Donna Broach for their capable assistance. National Research Council. 1984. Proceedings of a Symposium on District Heating and Cooling. Washing- ton, D.C.: National Academy Press. - vail

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Contents Executive Summary I. Introduction How District Heating and Cooling Systems Work, 10 Attributes of District Heating and Cooling Systems, 22 2. History and Background ...................................... History of District Heating, 25 The Recent Revival, 23 The Current Extent of District Heating and Cooling in the United States, 31 The European Experience, 31 The Market for District Heating and Cooling The Argonne Model, 39 Prospects and Uses, 41 District Heating ant! Cooling Markets, 51 7 25 ~, 39 4. Impediments 57 Data anct Information, 58 Taxes and Fees, 59 Regulation, 61 Costs, 67 Financing, 69 5. Leadership, Strategy, and Institutional Arrangements 76 Leadership and Strategy, 76 Coordinated Policy Action, 73 6. Technology and Product Development 81 Research Directions, 81 Research Dissemination, 83 1X

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7. Conclusions and Recommendations............................. District Heating and Cooling Systems, 85 Regulation, 86 Taxes, 87 Data and Information, 89 The Federal Role, 90 Financing, 91 Technology and Product Development, 92 Appendix A: Case Studies St. Paul, Minnesota, 96 WilImar, Minnesota, 106 Piqua, Ohio, 107 Trenton, New Jersey, 108 Jamestown, New York, 110 Baltimore, Maryland, 115 Pittsburgh, Pennsylvania, 120 Fairbanks, Alaska, 121 Los Angeles, California, 122 Appendix B: Systems in the Washington, D.C., and Baltimore Metropolitan Areas............... Military, 125 Colleges and Universities, 126 Residential, 126 Governmental, 128 Medical, 129 Institutional, 129 Appendix C: District Heating in Europe Factors Influencing District Heating in Europe, 130 Government Planning, 134 Appendix D: Technical Assessment, City of Baltimore District Heating Proj e ct . . . . . . e e e e e e e e e e e e ~ ~ e e e e e e e e ~ e e e e e e e e e ~ e e e e e e ~ e e e e Methodology, 141 Thermal Demand Assessment, 142 Thermal Supply, 144 Thermal Transmission and Distribution System, 144 Economic Analysis, 145 Summary, 146 References. 85 95 125 130 141 151 Glossary of Acronyms . . e e e e e e e e e e e e e e ~ ~155

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List of Figures and Tables Figures 1-1 1-2 1-3 1-4 1-5 1-6 1-7 1-8 2-1 2-2 2-3 2-4 2-5 3-1 3-2 3-3 3-4 3-5 4-1 4-2 4-3 4-4 A-1 A-2 A-3 A-4 A-5 Caterpillar tractor plant, Peoria, Illinois, 9 Possible elements of district heating and cooling systems, 14 Schematic diagram of simplified district heating and cooling system, 15 Municipal solid waste-fueled thermal production plant, Akron, Ohio, 16 Power plant cogeneration retrofit efficiency, 18 Energy flow analysis, 1980-2000, for the Piqua, Ohio, district heating and cooling system, 19 District heating transmission line in New England connects a downtown heat distribution grid to the thermal production plant several miles away, 20 Welding 10-inch steel for 320F hot water distribution nine to the state capitol. Trenton, New Tersey, 21 Commercial district heating systems in the United States and Canada in 1951, 27 District heating and cooling project cities, 30 Finishing a weld on a new section of district heating piping that carries steam to several buildings around the ellipse in front of the White House, 32 Capitol Hill district heating system, Washington, D.C., 33 District heating growth in selected European countries, 1960-1980, 34 District heating market penetration, 40 Starrett City: A New York City community served by district heating and cooling, 50 The growth of district heating on college campuses, 52 The growth of district cooling on college campuses, 53 Fuels used in campus systems, 54 Annual average increase in SO2 emissions due to district heating, 64 Ambient SO2 levels in Boston from the heating sector, 65 Ambient SO2 levels in the Twin Cities from heating other large point sources, 66 Components of system cost as a percentage of total costs, 68 St. Paul district heating pipeline network, 97 St. Paul District Heating Development Corporation development funding, 1979-1982, 101 St. Paul District Heating Development Corporation system financing, 105 Trenton district energy project, 109 Trenton District Energy Company: impact on government outlays and receipts, 111 r-r ~r-~~~~ X1

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Century City district heating and cooling system, Los Angeles, 123 A 1980 forecast for district heating development in Sweden, 133 Major potentials for district heating in West Germany, 155 Lower Rhine district heating main, 138 Planned distribution of district heating in Denmark in the year 2000, 139 Cherry Hill district heating project total end-user energy cost comparison, 149 Tables 2-2 3-1 3-2 3-3 3-4 3-5 3-6 4-1 4-2 A-1 A-2 A-3 A-4 D-1 D-2 D-3 1-1 Comparison of Steam District Heating and Hot Water District Heating, 11 1-2 Costs of Retrofitting Buildings to Use Cogenerated Hot Water, 23 2-1 Typical U.S. Steam District Heating and Cooling Utilities, 29 Energy Contributions of District Heating and Combined Heat and Power Systems in Selected Countries, 1981, 35 Net Energy Savings from Cogeneration District Heating. R~sid~nhal once Commercial Applications, 42 A, Scare Fuel Ravings from Generation District Heating, Residential and Commercial Applications, 42 National District Heating and Cooling Employment Generation, 43 Retention Model, 43 Comparative Urban Heat Load Density Values, 46 Heating Degree Days (Below 65F; 18C) and Population Densities, 47 Construction and Permanent Financing for Alternative Energy Projects: Key Risk Assessment and Containment Strategies, 70 Comparison of Financing Methods, 73 Preliminary Studies for the St. Paul District Heating System, 99 Cost of the Willmar System, 108 Jamestown Power Plant Retrofit Costs, 113 District Heating Piping System Cost for Jamestown, New York, 113 Baltimore District Heating Thermal Load Summary, 143 Baltimore Net Revenue Analysis-Fuel Equivalent Basis, with Cogeneration, 147 Cherry Hill District Heating Project-Total End-User Energy Cost Consumption, 148 ~ X11