What exactly is 'district heating'?

And why could district heating soon be at the heart of the heat supply in densely populated areas? Come this way to find out more!

Illustration shows renewable energies, a factory and a residential building seen through a magnifying glass© BMWi

This is what it's all about: more green district heat to cut carbon emissions. Heat networks that deliver renewable energy to urban centres.

So where is energy headed in Germany? And where is there potential to save energy or use renewables? Our own homes are a good place to start, given than heating our homes and offices, commercial and industrial buildings accounts for more than half of our overall energy consumption in Germany. More green district heating can help cut emissions and mitigate climate change. But what exactly is district heating? And how can we make sure there will be more of it in the future?

District heating is the term used to designate the supply of heat to buildings through a heating network delivering thermal energy. A power plant, solar thermal or geothermal installation or a large heat pump is used to heat water which is then fed into a network of insulated (and usually buried) pipes, straight into the buildings connected to the system. The water then flows through a handover station and into the building’s own heat distribution system, which provides for a supply of heating energy and hot water. Once the water has cooled down, it flows back to the original heat source and the circle begins anew. In other words, buildings that are supplied with district heating can do without their own heating systems and chimneys.

District heating networks to make the switchover to renewables and waste heat

The energy transition in the heating sector is a prerequisite for the success of the wider energy transition. District heating is a key element of the energy transition in the heating sector. The existing district heating networks need to be decarbonised, i.e. switched to lower temperatures and fed with renewables or waste heat. By contrast, our existing district heating networks usually work with temperatures of 95° C or more. And they are most commonly powered by power plants that do use combined heat and power (CHP), but are based on fossil fuels. In fact, more than 70% of district heating still came from natural gas, lignite, or hard coal in 2020. So the share of renewables needs to increase. There are different technologies available, including large heat pumps or solar thermal installations, geothermal installations, and CHP installations based on biomass or green hydrogen. Since 2010, the share of renewables in district heating has steadily risen by around 10% from the initial 7.8%. In 2020, 17.8% of the 126 billion kilowatt hours (kWh) of district heat generated in Germany came from renewables (more than 22 billion kWh). This is what the initial analysis of the data on district heating in Germany in 2020 shows.

For urban areas, green district heating is a way forward towards better climate action

The use of unavoidable waste heat from industrial installations can also play an important role in the decarbonisation of the heat networks. And CHP based on natural gas is an important technology for us as we move towards climate neutrality. Why is that? Because the share of coal-fired CHP installations will fall drastically during this decade, and because many of these plants will be replaced by gas-fired ones. However, by 2050 at the latest, natural gas will also no longer be permissible as a source of heat for the heating networks.

Today, district heating makes up only a small share of the heat we use. In 2018, some 109 terawatt hours of heat were supplied from heating networks. This is around 8% of the overall need for heating for buildings and for process heat. In future, district heating will have to be used to supply a much greater share of buildings. This is because heating networks are extremely useful in the transformation of the heat supply: unlike individual buildings, they can be powered with a large range of different renewable and climate-neutral heat sources, better incorporate heat storage, and even store heat themselves. That said, district heating is not a solution that works efficiently everywhere. The need for investment is comparatively high, and even if the pipes are very well insulated, they will lose some of the heat over longer distances. This means that district heating only works for densely populated areas.

'Green district heating is an opportunity for climate action, particularly in densely populated areas like cities where there is often no space for on-site renewables installations', says Kerstin Andreae, managing director of the German Association of Energy and Water Industries (BDEW). In the years to come, the operators of local district heating networks are planning to make large investments in the switchover of district heating to renewable sources of heat and to waste heat.

Dialogue on climate-neutral heat and the right policy framework for this

It is important to get the policy framework right for these developments to take place. This is why, in February 2021, the Federal Ministry for Economic Affairs and Energy launched a dialogue on 'climate-neutral heat' (in German only), bringing together the stakeholders involved in the heat market for discussions on how to pave the way towards a climate-neutral heat supply by 2050. What can the Federal Government do to speed up this process? What should be the design for planning processes for a climate-neutral heat supply at the municipal, Länder, and federal levels? How can decision-makers from different sectors be brought together? To read the brochure on this 'dialogue on climate neutral heat', please click here (in German only).