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6 Technology and Product Development The basic technology for district heating and cooling is well understood in the United States. In addition, the cases of Trenton, St. Paul, and others cited throughout this report indicate a potentially large market in both the United States and Europe for U.S. manufacturers of district heating and cooling equipment. U.S. manufacturers, however, suffer from several disadvantages. Several U.S. manufacturers and trade associations claim that European countries subsidize exports of district heating products, particularly steel pipes. Thus, U.S. manufacturers say that Europeans are able to submit bids on U.S. district heating and cooling projects below the costs of their American counterparts. In addition, in competing for European markets, U.S. manufacturers are confronted by European companies with well-established technologies and products. The committee has been unable to substantiate this charge, although the Office of the U.S. Trade Representative recently found that European countries were sending more than double the agreed-upon amount (5.9 percent of U.S. consumption) of steel pipe into the United States. Nevertheless, U.S. manufacturers have several opportunities for market penetration. District cooling, a technology developed in the United States, exists only in a few cities in Europe (see Chapter 2~. Innovative marketing could create inroads there. So, too, could innovative products that either increase efficiency or reduce the costs of systems. Research to improve the technology is needed to take advantage of these opportunities. RE SEARCH DIRECTIONS There has been little research or market and product development for district heating and cooling. The design and development of system technology have advanced only marginally, with the exception of those for district cooling. Product development has been very limited. 81

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82 Despite these facts, district heating and cooling is not inhibited by technology or a lack of engineering skills. The case studies in Chapter 3 and in Appendix A are replete with examples of innovative applications. Despite these and other innovative applications, there are some new products that would help make the technology more efficient and U.S. manufacturers more competitive. The Department of Energy (DOE) has already proposed research or support for programs in 34 areas related to district heating and cooling (U.S. Department of Energy, unpublished information, 1984~. The committee has identified those it believes to be the most important. These topics include meters, nonmetallic piping, more effective insulation, low-temperature systems, and combined district heating and cooling systems. Because fuel flexibility and low-cost fuels are so important for district heating and cooling, research on fuel alternatives and combustion techniques should also be pursued. Environmental restrictions on the use of certain low-cost fuels can be overcome only by more effective combustion or stack cleaning devices. Combustion appears to offer the best and least-cost opportunity. Using municipal solid wastes as a fuel source offers the opportunity to deal with two major urban problems simultaneously. As discussed earlier, the disposal of municipal solid waste has become increasingly more costly and problematic. At the same time, providing constant, efficient, and inexpensive heating and cooling is an essential urban development tool. Research is needed on the technology for burning municipal solid wastes to cogenerate electricity and thermal energy for district heating and cooling systems. Steam and hot water systems generally operate at temperatures well above 150F (65C), but lower temperatures may prove economical and effective. Geothermal heat and waste heat from power or industrial sources represent significant low-temperature energy resources of less than 150F (65C). The effective use of these resources needs further research. District heating and cooling systems are capital intensive, particularly the distribution systems. Manufacturing and installing pipes can represent about 70 percent of a project's capital costs (see Figure 4-4~. The financial feasibility of a project is, of course, markedly affected by these costs. Better standards and design methods for pipes can reduce their cost significantly. Research can improve pipe materials, insulation, installation methods, and fastening and burial techniques. The use of low-temperature distribution systems could lead to pipe insulation and installation changes that would further reduce costs, as could the use of heat pumps or supplemental firing, either at the plant or by the user. Most U.S. systems can be switched between heating and cooling. The operator must assess the weather and direct the system from heating to cooling or vice versa. Most modern commercial buildings located in moderate temperature zones are approaching the year-round use of

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83 daytime cooling. Many buildings are designed with windows that do not open to increase energy efficiency by reducing heating and cooling loss. Such buildings, however, may need cooling on days when others whose windows open do not, unless they are equipped with air-conditioning systems with natural cooling capability to compensate for high internal loads and solar gains. More responsive systems are needed to meet this change in use and the differential and simultaneous heating and cooling requirements of large buildings. Currently, separate heating and cooling distribution systems are expensive. Using existing building equipment to heat and cool simultaneously is possible, but is often inefficient or costly or requires premium fuels. Research should be conducted on the use of " two supply-one return" systems sized for heating and cooling or on pulse systems using alternate pulses of hot and cooled liquids. Storage systems required for the pulse method are another useful area for research. Retrofitting existing steam systems in the United States should be considered in research and market development. Many steam systems are 50 years old or older. While many are supplied by conveniently located cogenerating power stations that burn coal, others depend on oil-fired, heat-only boilers for thermal energy, especially power plants located outside downtown areas. System obsolescence, fuel costs, and rising operating costs have contributed to the decline and abandonment of such older systems. These systems are a unique asset for district heating and cooling in central business districts, but only if they can be rehabilitated economically. Existing steam systems together with hybrid district heating and cooling systems can significantly enhance equipment compatibility, point-source pollution control, system backup, and demand flexibility. Long-term recovery costs can be reduced by using intermediate exchangers that convert steam to hot water and use steam for chilled water production in either a networked or retrofitted system. More accurate and less costly customer meters are also needed. European studies suggest a difference in consumption of 10 to 25 percent between metered and unmetered users (IEA, 19831. Current flowmeters (supplemented by a differential temperature measure) reflect Btu use rather than just water flow. Ingenious users can achieve high heat input with low water consumption. Meters currently cost from $200 to $400. Some sources suggest $100 is the greatest justifiable cost. There is great market potential in both the United States and Europe for such an inexpensive meter. RE SEARCH DI S SEMINATION Policy appears to have led to improved applications rather than new technology development. The transfer of technical, product, and market information is largely limited now to the efforts of several

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84 industry associations. Until recently, little information was distributed to potential clients--mayors, county executives, system designers, large developers, or those in the financial community. Technical information is restricted primarily to communications sponsored by industry assoc rations . The newest of these associations has public programs to further the understanding of district heating and cooling, but until recently the association appears to have devoted more energy to lobbying than to disseminating general information and developing the means for technology transfer. The allocation of resources is now becoming more balanced. Information on basic research and on applications can circulate among trade, professional, and client groups. Each of these groups maintains its own communication networks, so using these networks is a cost-effective way to communicate information about district heating and cooling nationwide. One focus of such an effort might be the total energy systems committee of the American Society of Heating, Refrigeration, and Air Conditioning Engineers (ASHRAE). The government can also help ensure that such knowledge is disseminated broadly. Technological advance and expansion of the district heating and cooling industry serves a number of national objectives, from export of U.S. technology and business to meeting the goals of the National Energy Policy Plan (NEPP) for the use of low-cost, abundant fuels that result in using energy more efficiently. DOE has developed economic models and analytical techniques for district heating and cooling. They have been used to help evaluate the prospects for district heating and cooling in the 28-city assessment program jointly run by DOE and HUD. Broad distribution of these analytical methods and models, together with programs for data exchange, would help reduce the planning barriers to district heating and cooling in the United States, especially when combined with technical help provided to local governments and the private sector. Professional associations can support such technology transfer. 1