Cogeneration and district heating: An enabler of the green transition?

According to a recent study, cogeneration or, as it is also called, Combined Heat and Power (CHP) in district heating, is thought to be an efficient enabler for reaching carbon neutrality by 2050.

With the latest Council conclusions, gas CHPs remain an important technology with a significant role in reducing emissions, especially in regions transforming away from coal and dense urban areas. Switching from coal to natural gas saves over 70% of CO2 emission, while providing security of heat supplies and improving air quality.

An important product that can be achieved through cogeneration is district heating. Together with cooling, heating in buildings and industry accounts for 50% of the EU’s annual energy consumption, with 60 million people using it across Member States.

While on one hand district heating produced in a cogeneration system requires considerable upfront investment, on the other, the technology, if well used, has the potential of reducing Europe’s heating infrastructure carbon footprint. To achieve this, ensuring the decarbonisation of heat is key. Retrofitting the heat sources currently based on coal into gas or if feasible turning them to more natural sources, such as heat pumps, geothermal or solar thermal energy, could prove to be effective solutions.

As the European Commission works on the revision of the European Energy Efficiency Directive, the Renewable Energy Directive II and the EU Emission Trading System, the energy industry is concerned about what this will mean for cogeneration plants and district heating in the future, especially in those Member States where energy transition relies on switching from coal to gas generation. More specifically, what will this entail in terms of meeting criteria and costs?

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