What's the deal with district energy?

District energy refers to a system in which a shared central plant distributes steam, hot water, and/or chilled water to multiple buildings via underground pipes. In this episode, Rob Thornton of the International District Energy Association shares about district energy’s newfound popularity and the role it could play in the clean energy transition.(PDF transcript)(Active transcript)Text transcript:David RobertsDistrict energy is one of the oldest concepts in all of energy, dating back at least to the ancient Romans. It simply refers to connecting multiple buildings to a common source of heating and cooling — a furnace, heat pump, geothermal well, or what have you — and distributing the heat via water or steam flowing through underground pipes. There are hundreds of district energy systems in operation, in every country in the world. (Virtually all of the buildings in Iceland, which I visited recently, are heated by district energy systems running on geothermal.)However, fossil fuel heat has been so cheap for so long that district energy has never quite become the default — it’s just been too easy to stick a natural gas furnace in every building. There hasn’t been much pressure to share heat.But with the climate crisis and the clean energy transition, that’s changing. These days, lots of people are looking for cleaner sources of heat and more efficient ways to share it, so district energy is becoming sexy again. Among other things, it’s a great way for cities to meet their carbon goals without overburdening their electrical grids.With all that in mind, I contacted Rob Thornton, the head of the International District Energy Association, to chat about the clever new sources district energy systems are drawing on (everything from sewage to deepwater lakes), the infrastructure they can integrate with, and the other services they can provide.All right, then. With no further ado, Rob Thornton of the International District Energy Association. Welcome to Volts. Thanks so much for coming.Rob ThorntonThanks for having me, David. Pleasure to be here.David RobertsI am super into district heat, so I was delighted when you all reached out to me. I've been meaning to do something on it, but I think it's, at least in the US, not particularly familiar or well understood to most people. It's relatively rare in the US, which we will discuss later. So, let's start with a definition. What is district heating?Rob ThorntonSo, we call it district energy because it's both heating and cooling in cities, campuses, communities. Essentially, it's a central plant that's providing steam, hot water, and/or chilled water to an underground thermal piping network to provide heating and cooling to buildings in a city central business district, campus, airport, hospital, healthcare, et cetera. So, it really is the aggregation of multiple users of heat or cool provided by a central plant. So, each individual building doesn't need to dedicate space or equipment, right, to boilers, chillers, et cetera. So, yeah, that's the simple definition.David RobertsCould not be more simple. It's using one source, a single source of heating and cooling for multiple buildings, which you think seems like an obvious thing to do. What, in terms of existing district energy systems in the world, what is that central source? Typically, empirically, what's the most common current central source?Rob ThorntonI'd say at the moment, still natural gas.David RobertsJust a big boiler?Rob ThorntonWell, often large boilers, sometimes gas turbines, recovering the heat, making additional electricity. So, combined heat and power. But that's shifting with the energy transition appetite for lower carbon solutions. There's a lot of integration, optimization happening. Industrial heat pumps, renewable heating and cooling, a variety of sources. That's the advantage of district energy. You change the central plant, and actually the benefits flow to multiple, sometimes hundreds, thousands of customers by updating the central plant.David RobertsIs it safe to say these days that all things being equal, natural gas is probably the cheapest, that's why it's the most common?Rob ThorntonWell, it's cheapest, it's cleaner than some other solutions. It's dispatchable, available, widely available. And it wasn't always that way. District energy started really by the Romans, but then Thomas Edison I would really characterize as the inventor back 140 plus years ago, and he discovered he couldn't really just sell electricity. He had to actually sell heat, too. Building owners saying, "Oh, I'll buy your power, but what am I going to do with the dynamo in my basement that provides the heating?" And so Edison realized, in order to make a profit at this enterprise, I have to sell both the heat and the power.So, while it's not commonplace, in fact, district energy is prevalent. 900 systems in North America, thousands all over the world. Every major city has district energy from Paris...