Unlocking Hidden Gems: The Surprising Advantages of District Energy Systems

District Energy systems for heating and cooling, particularly where commercial and residential share a neighborhood, are affordably increasing both building comfort and sustainability efforts, large and small. Although some forms of District Energy have been installed and active since the 1800s, worldwide adoption is now rapidly growing, and the efficient technologies that these systems employ are evolving quickly.

While more and more District Energy systems are being deployed worldwide, in North America, these systems remain an underutilized efficiency option, particularly where commercial and residential coexist. Instead, most energy efficiency efforts focus on improving building envelopes and equipment or adjusting how people consume energy. These are excellent first steps. But when combined with the big-picture opportunity of District Energy, the door is opened to a much larger opportunity to incorporate sustainable solutions while capturing and sharing otherwise wasted heat on many projects of varying sizes.

The Power and Savings of District Energy

• Greater energy efficiency and lower greenhouse gas (GHG) emissions: less energy is needed when the source of heating and cooling is a centralized plant uniting many buildings of varying types. This not only increases overall efficiency but reduces the amount of equipment needed, thus saving embedded carbon.
• Improved technologies can be used to better capture waste heat from varied sources such as wastewater, industrial processes, geo-exchange, solar, and exhaust air. When coupled with thermal storage, this wasted heat can be shared throughout the system.
• Since your primary source of heating and cooling is centralized, it is much easier and less costly to incorporate new, more efficient technologies as they become available. And with the vast amount of effort focused on improving the sustainability of thermal systems, this is imperative.
• Provides an efficient, budget-friendly way to electrify buildings that previously relied on fossil fuels.
• Expanded diversity of thermal loads provides better load control to accommodate peak demand on the electrical system and reduce stress on the electric grid.
• Creates a more resilient system for withstanding extreme weather.
• Reduces air pollution thanks to lower fossil fuel use and less opportunity for refrigerant leaks across numerous buildings’ one-off heating and cooling systems. Encourages the growth of denser urban areas with mixed-use developments, boosting a more sustainable community over sprawl.
• More predictable energy costs due to potential fuel source flexibility and the ability to lock in better long-term energy contracts.
• Decreases the need for investments in power generation and transmission infrastructure.
• Increases space in buildings by eliminating the need for boilers and chillers.
• Where many existing buildings have heating but not cooling, district energy inherently offers both – increasingly valuable in a warming world.

Investing in Tomorrow: The Rewarding Path of District Energy Systems

District energy’s lifetime costs are more affordable than perpetuating the outdated blueprint of creating stand-alone buildings’ heating and cooling systems. While the lifecycle benefits of District Energy far outweigh the initial cost, sometimes the initial capital investment necessary for establishing a new system can present a small hurdle. There is potential to incorporate significant federal and state dollars aimed at district systems to offset this initial cost. These grants, incentives, tax credits, and loans will continue to flow into this market over the next 10 years, spurring the creation of new systems.

Also, existing infrastructure components can be improved and leveraged to provide additional opportunities to renew and expand district energy. In many U.S. cities, century-old energy circulation systems, originally designed to deliver heat with steam, are being repurposed using underground pipelines and right of ways to convert from steam to more efficient heating hot water. These historic systems, some of which date back to the nineteenth century, are gradually undergoing retrofitting to optimize their functionality by transitioning to cleaner fuel sources and harnessing energy previously wasted during the production and delivery of the heat source. Likewise, many cooling systems also serve large cities.

The Soaring Need for District Energy Systems

The Pacific Northwest has a history of very mild summers, so there hasn’t been a high demand for cooling buildings’ interiors. But as we continue to experience extended summers and higher temperatures, we’re seeing more interest in District Energy cooling and heating for both residential and business solutions.

There are so far just three newer, highly efficient District Energy projects in downtown Seattle. UMC’s involvement with one of them sparked interest in the newest when Onni created a more sustainable premier urban development with a District Energy system that supports buildings across two city blocks.

“It’s cool that UMC has been involved in two of only three new District Energy projects in Seattle,” said UMC’s president, Steve Brooks. “We weren’t around in the 1890s when Seattle Steam started the first one. We missed that one by about 25 years.”

Energizing the Future: The Push for District Energy Systems

District Energy systems should be a standard part of a city’s plans and zoning needs to support system implementation. Cities can also help with financing through bond issuances or tax incentives to offset the upfront costs. Cities can also supportsystems'e continued creation and expansion by encouraging buildings to connect to efficient district systems with new supportive policies. Public-private partnerships can also support District Energy development by creating paths to leverage additional funds to support new opportunities.

State and federal policies and programs should also do more to encourage district energy system adoption. The U.S. Environmental Protection Agency, particularly through its Energy Star program, provides some District Energy system support, and the U.S. Department of Energy Better Buildings program has a Combined Heat and Power for Resiliency Accelerator. Locally, recent legislation such as HB 1390 provides a clear path for Campus District Energy Decarbonization Planning. Guidelines like these help developers and public entities create new systems and improve existing ones.

Another resource for District Energy Systems is the International District Energy Association, a non-profit trade association with membership from around the world.

UMC is here to help. UMC Energy + Environment experts help connect the dots on district energy systems and create more efficient systems to meet your needs. In the end, we all win!