The role and costs of large-scale heat pumps in decarbonising existing district heating networks. A case study for the city of Herten in Germany

This paper discusses different decarbonisation scenarios for an existing district heating (DH) network supplied by coal-fired combined heat and power plants in Germany. Integrating higher shares of renewable heat is indispensable in reaching the climate goal and CO2 emission reduction targets. The study analyses the technical and economic aspects of integrating various technologies such as solar thermal, biomass boilers, waste incineration plant and heat pumps into the existing DH network, with the main focus on large-scale heat pumps. The approach consists of two main steps. First, we forecast future heat demand and the potential to extend the DH system by simulating the evolution and energy consumption of the city's building stock. Second, we use a supply dispatch model with hourly resolution to calculate alternative scenarios and sensitivities for the supply mix with a focus on heat pumps. Our results show that, under the current regulatory and economic framework, large-scale heat pumps are not cost competitive with the existing coal-fired CHP units. However, redesigning the regulatory framework and optimising heat pump design and operation could achieve cost parity. The CO2 price induced by the EU emissions trading scheme will most likely not be a sufficient incentive in short and medium term.