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District Energy Background Paper

District energy (DE), refers to a network of buried pipes that carry thermal energy in the form of steam or hot or cold water to connected buildings and homes from a central energy source. DE is used primarily to heat and sometimes to cool buildings in place of conventional heating/cooling systems (e.g., furnaces, air conditioning units, boilers, chillers). By incorporating combined heat and power (CHP), DE can also generate electricity to share with connected buildings or send to the grid. It is also sometimes called neighbourhood or community energy.

Three physically connected sub-systems

Solar energy: solar panels can supply both heat and electricity, separately or combined. Waste heat: unused heat produced by chillers, machines, electrical equipment, industrial processes, can be extracted from waste water or exhaust air and fed into the district energy system. Biofuel cogeneration: fuels derived from plant materials or other organic waste in the form of pellets, biodiesel, biogas, and pyrolysis liquids (organic material heated without oxygen) fired in a generator to produce heat and electricity. Heat pumps: refrigerant compression cycles collect thermal energy from sources such as the atmosphere, ground, sewage or building exhaust and use it to increase or decrease supply temperatures for building heating or cooling. Energy storage: using bore holes in the ground or aquifers for annual thermal storage, water tanks for daily thermal storage, hydrogen production, or various electricity energy storage.

Renewable Energy Inputs

Energy Centre houses the mechanical equipment (e.g., boilers, chillers) that generates thermal energy in the form of steam or hot or chilled water which gets distributed to connected buildings. The Energy Centre can also store energy, generate electricity to put into the grid, and recover and use waste heat from neighbouring buildings and industry.

Distribution Piping System transports steam and/or hot or chilled water from the energy centre to the connected buildings and returns lower energy water or steam condensate.

Energy Transfer Stations transfer thermal energy at the building from the distribution piping system to the buildings internal heating, cooling and domestic hot water supply.

Alternative Technologies

What is combined heat and power (CHP)? Combined heat and power is a process that burns fuel to produce electricity and thermal energy (in the form of steam or hot water) at the same time. Rather than sending the waste heat from the electricity generation process out into the atmosphere and the Great Lakes, as is done in most electricity generation processes in Ontario, the waste heat can be captured and piped to buildings connected to the DE system. Benefits of CHP include: Higher overall efficiency: By using CHP, more energy can be extracted from the same amount of fuel and can result in a 40-50% increase in efficiency over conventional electricity generation. Flexibility: CHP electricity generation can be turned on or off to correspond with demand. This would reduce demand during peak periods when the grids electricity is generated primarily from fossil fuels such as natural gas.
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Combined Heat & Power

Prepared for Project Neutrals Neighbourhood Summit, Evergreen Brickworks, June 9th.

District Energy Background Paper


Benefits of District Energy

Prepared for Project Neutrals Neighbourhood Summit, Evergreen Brickworks, June 9th.

Energy cost savings: By connecting buildings that have different energy demands, district energy can reduce the cumulative peak demand of the connected buildings, lowering energy demand and energy costs. By incorporating combined heat and power, district energy can also generate revenue for the community or system owner. Neighbourhood resilience: District energy systems can be retrofitted more easily than conventional systems to incorporate renewable fuels and technologies allowing system to more easily adapt to changing technology, and fuel prices and availability. Less pollution and emissions: By allowing connected buildings to share energy and incorporate renewable fuels, district energy systems can help communities move away from fossil fuel dependence and towards zero GHG emission operations.

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District Energy Retrofits in Existing Neighbourhoods Challenges of Implementing District Energy


Education and Awareness: Many people are not aware of the available technologies, existing systems and the potential benefits of district energy. Leadership: Project champions in our communities, utilities and government are needed to build momentum for district energy. Financing: Access to start-up funds is needed to procure feasibility studies, planning applications, etc. Upfront capital and supportive financing mechanisms are needed to get district energy projects off the ground and can be more difficult to procure for low density residential neighbourhoods. Mole Hill, Vancouver, Canada Key neighbourhood features: Medium density neighborhood renewal project, completed in 2003, of homes built between 1888 and World War II, located in Vancouvers West End. Technology: Building energy retrofits and strategic integration of ground source heat pumps connected by in-ground geothermal well-pipes servicing 4-6 houses each, with a total of 72 pumps servicing 96 residential suite Partnerships & Financing: The project cost including $900,000 for ground source heat pumps was covered by a loan from CMHC to be paid back over 35 years. The City leased the land to the Mole Hill Community Housing Society for 60 years at no cost. Bain Apartments Co-op, Toronto, Ontario Key neighbourhood features: High density (140 units per hectare) four-story co-operative (in grade related buildings) originally commissioned by the Toronto Housing Authority in 1913. Technology: Energy retrofits, solar panels, steam district heat and hot water system, composting and communal gardens. Partnerships & Financings: $6 million funds for the initial establishment of the co-op were provided by CMHC in the early 1970s. In 2010, the federal government contributed approximately $700,000 for renovations, energy retrofits and upgrades as part of Canadas Economic Action Plan.