District heating cost fluctuation caused by price model shift

Abstract

5District heating (DH) is considered as an efficient, environmentally friendly and cost-effective method 6 for providing heat to buildings, and is playing an important role in the mitigation of climate change. 7Nowadays, Swedish DH companies are facing multiple challenges, and in urgent need for new price 8 models to increase transparency and keep the competitiveness. In this paper, a survey is carried out 9 to understand the structure of the present price models. Then, two restructured price models are 10proposed and compared with the price model most commonly used. To increase the transparency, 11 price models should base on users' consumption profile; while to reduce the peak load, adopting the 12 pricing strategy based on load demand is an effective way. Consequently, users with flat 13 consumption profiles will save cost, whereas users with steep consumption profiles will have a cost 14 increase, when charging the load demand cost based on daily or hourly peak load demand.

Participation of an Energy Hub in Electricity and Heat Distribution Markets: An MPEC Approach

“…Although the heating market is not as competitive and mature as the electricity market, it is attracting increasing attention from researchers, due to development of district heating systems [1]. Heating market organization is discussed in [24], which can be categorized into regulated markets (such as China, Russia) and deregulated markets (such as Denmark, Sweden). Heat pricing scheme is a key issue and receives a lot of research efforts.…”

A dynamic price model based on levelized cost for district heating

“…It is more likely for a customer to take action if the cost increases significantly. In order to assess the impacts of price models on the selection of alternative heating solutions, an industry customer facing significant cost increase in the price model restructuring process was selected according to our previous work (Song et al 2017). The annual heating cost of the selected customer was calculated by applying different price models.…”

“…In order to improve the competitiveness of DH, some large companies have been reforming their price models and LDC receives the most attention. The purpose of emphasizing the importance of LDC is to encourage consumers to change their behavior and reduce the peak demand (Song et al 2017). As a result, DH companies can reduce investments in peak capacity and avoid using expensive fuels, which would, consequently, lead to a lower heat price.…”

Techno-economic analysis of implementing thermal storage for peak load shaving in a campus district heating system with waste heat from the data centre

“…When considering the peak load, the heating bill may be divided into two parts: fixed and variable. The fixed part is charged based on the seasonal peak load and may consist of a significant part of the total heating bill [2].…”