“Another war has begun with fossil fuels at the centre of the conflict. … And the fact that buzzwords like energy dependence, security of supply, reliability, price stability are now of great importance again is the only good thing about the situation.”
With a view to the current situation in Ukraine and its influence on the European energy sector, Dominik Rutz (WIP Renewable Energies) welcomed more than 40 participants to the REPLACE Innovation Workshop in Wels, 8th April 2022. As part of the World Energy Efficiency Conference, the REPLACE project team took the opportunity to exchange with participants about renewable heating and cooling in the residential sector.
After a long time of political attention being focused only on the electricity and then on the mobility sector and neglecting the heating and cooling sector, the consequences are now being felt, Rutz said. “The REPLACE project starts exactly here and promotes the switch from fossil energies to renewable heating systems in the heating and cooling sector.”
The workshop introduced the project REPLACE with its aims, tools and actions, gave an overview of the decarbonisation of the heating and cooling sector in Europe, and looked at the main challenges and drivers as well as possible solutions and recommendations to successfully switch to climate friendly technologies.
The REPLACE project
In his presentation of the REPLACE project, project manager Herbert Tretter (Austrian Energy Agency) introduced the 11 partners in 9 countries, through which REPLACE is covering different situations in terms of socio-economic conditions and market development. “The aim is to make space and domestic water heating in private households independent of energy imports, and green heat should come from peoples’ own roof, garden, earth or local forest” as Tretter stressed. As another core point of the project, beside free of cost replacement tools, he presented the 9 local working groups that are active in the heat market in the regions and are involved in the development of measures that are now being implemented.
Decarbonization of the heating and cooling sector – Keynote presentation Prof. Neven Duić
Prof. Neven Duić from the Department of Energy, Power Engineering and Environment at the University of Zagreb gave an overview of the decarbonisation of the heating and cooling sector in the residential sector. As he pointed out, decarbonisation must proceed quickly: “From a climate perspective, this should be done by 2040. From a security of supply perspective, this would have to happen even faster, ideally as early as next winter”.
Prof. Duić introduced 4 possible pathways to decarbonisation, “with district heating being the most versatile way for urban heating, as it can be fed from numerous renewable sources such as the use of waste heat, solar, geothermal, heat pumps, biomass, etc.”, as well as heat pumps as individual heating systems. In relation to the European policy (efficient DHC, Art.24 recast EED), Prof. Duić presented the targets for efficient district heating from 2025 to 2050, which showed that renewable energy sources, waste heat and high efficiency cogeneration heat have to achieve a steadily increasing share, with cogeneration in district heating being completely phased out after 2035. In addition to using more solar energy and thermal storage, Prof. Duić mentioned geothermal energy as an option widely available in Europe and being feasible in view of the current high gas prices and the need to replace gas boilers.
As to Prof. Duić’s conclusion, “the integration of power, heating, cooling, water and transport system is necessary as soon as possible. There is a need for smart energy systems that are cheap and simple. It is necessary to concentrate on district heating which is very versatile in integration of various heating flows in urban areas, heat pumps in rural and suburban areas – integrating renewables and renewable electricity. And it is important to take care to use biomass only in cascades – not to chop trees for heating, but to use wood for higher added value, and use only waste biomass for heating.”
Actions in the REPLACE regions
Gašper Stegnar from the Jožef Stefan Institute Energy Efficiency Centre (JSI) presented actions from the REPLACE regions which promote the phase-out of inefficient and old heating and cooling systems. Among others, Stegnar referred to the one-stop-shop of the project leader Austrian Energy Agency in Austria. Interested parties can select providers in their vicinity on an internet platform, who implement climate-friendly systems in an all-round carefree package.
Or the participation of project partner BSERC in increasing the subsidy for renewable systems to 70 million euros and the organisation of joint pellet purchasing to achieve good prices. The development of a new subsidy scheme in Spain was another example, with which a total of 10 MW of residential boiler capacity will switch from fossil fuels to biomass within a few months. And finally, the campaign from Slovenia, where everyone who applies for climate-friendly heating uses the REPLACE heating calculator. On top of that, JSI’s campaign “Replace fuel oil for the sake of the environment” resulted in the replacement of over 130 fuel oil boilers with heat pumps.
Materials in the REPLACE project
Benedetta di Constanzo from WIP Renewable Energies presented the free of cost materials provided by the REPLACE project for end customers, intermediaries and investors: The guide for end-users, including e.g. the benefits of sustainable heating system, seven replacement steps to take, as well as a list of renewable technologies. The guide for intermediaries and investors, e.g. covering the whole replacement process, mistakes to avoid, and reasons for investors to invest in renewable systems. And the collection of around 40 best practice examples, that are, as di Constanzo emphasized, “about real life stories that show that climate-friendly heating systems are possible, technically and economically feasible”.
The REPLACE calculator
As one of the main tools, Herbert Tretter demonstrated the REPLACE calculator. “There are many things to consider – which technologies and fuels are available, which subsidy programmes can be taken into account and how high are the heating costs if I don’t just look at the initial costs?” he said. The calculator should help to find the best solution for one’s house, e.g. together with an energy consultant or installer.
Main challenges and drivers for the introduction of renewable energy in the heating and cooling sector – Roundtable
In the second part of the workshop, a roundtable was held to discuss the main challenges and drivers for the introduction of renewable heating and cooling in South East and Central Europe.
The roundtable, moderated by Karina Knaus (Austrian Energy Agency), started with an introduction to the varied situation of heating and cooling in the partner regions. In the Sarajevo region (Bosnia and Herzegovina), there are almost 100 % fossil-fuelled heating systems, half of which are covered by gas district and gas-fired individual heating systems. In the Rhodope region (Bulgaria), with many energy-poor households, heating is traditionally done with firewood in inefficient, polluting stoves (70 %), while wood pellets, air-to-air heat pumps and solar thermal play a minor role.
The region of KAGoP (North Macedonia) is dominated by heating with firewood and electricity, 25% in the capital Skopje are connected to district heating. In the Salzburg region, 35% already heat with climate-friendly district heating. The remaining ¼, who heat with gas and oil, can receive subsidies for renewal, but are hindered by a lack of skilled workers and materials. And in the Bavarian Oberland (Germany), 80% of private households still heat with fossil fuels, which can benefit from subsidies as in Austria, but are also hindered by a lack of skilled workers.
As became clear in the discussion, the rising prices for pellets and electricity due to the war in Ukraine are working against the REPLACE activities, so that e.g. in Bosnia and Herzegovina, North Macedonia and Bulgaria end customers are returning to heating with coal or firewood, thus slowing down the heat transition.
Why has change not yet taken place?
Karina Knaus’ question, why a change beyond the current situation has not yet taken place, although it is necessary for climate protection, was answered differently by the participants of the roundtable.
In Austria and also in Germany, subsidies help to phase out oil and gas and to renovate buildings. At the same time, the shortage of plumbers, boilers and parts currently forms a barrier, so that a heating exchange cannot be implemented, as Herbert Tretter and Ingo Ball stated. Moreover, “there are players in the market that like to sell fossil fuels at discount rates which wouldn’t be beneficial for the renewable market”, as Ball pointed out.
In North Macedonia, Bulgaria and Bosnia and Herzegovina, the lack of subsidies for heating system replacement and renovation, the lack of legal strategies for renovation and the requirements for renewable energies play a role. Socially, there would be a lack of appropriately trained staff in municipalities. Financial and political measures would be necessary for change.
Possible solutions and instruments
At the end of the workshop, the participants discussed possible solutions to implement climate-friendly heating and cooling. In order to stabilise pellet prices in the long term, Herbert Tretter presented the proven approach in Austria of setting up national pellet storage facilities for domestic demand instead of exporting too many pellets. In addition, subsidies would currently be necessary, especially for low-income households, in order to retrofit. And Herbert Tretter also recommended more solidarity within the EU in the heat transition.
In Bosnia and Herzegovina, Samra Muratspahic wishes for the continuation of subsidies and political measures that are currently being implemented. These include a project in the region where subsidies for heating system replacements are being paid for the first time, as well as a strategy for replacements in areas that are important for air quality.
In the Bavarian Oberland, so-called village heating systems work well, with farmers using their own wood to run a micro-grid for their neighbourhood. Energy caravans in neighbourhoods in need of renovation and short explanatory videos, e.g. for applying for subsidies, are among the tried and tested means.
In the Rhodope Region, REPLACE tools such as technology factsheets, best practice examples and info-hubs have proved particularly useful in providing advice and mobilising people to exchange, as Angel Nikolaev stated.
And from the perspective of the KAGoP region in North Macedonia, Emilija Mihajloska recommended the preparation of strategic documents in line with EU goals and measures. Subsidies for pellets, invertors, roof and facade construction are suitable, more subsidies in the field of heat pumps and PV systems as well as the retrofitting of existing buildings.
Conclusion and recommendations
The REPLACE workshop ended with conclusions and recommendations presented by Ignacio Macías (ESCAN Energy Consulting, Spain). Among the REPLACE findings were the fact that the majority of the population wants climate-friendly solutions, but the initial investment is the main barrier. Well-informed stakeholders and consumers, together with funding, achieve better results. The lack of skilled labour is the key limiting factor.
At the same time, collaborative actions such as the Austrian one-stop-shop have shown room for improvements, for example when workers dismantle old heaters, thereby creating time for trained plumbers to install new systems. Furthermore, the rise in fossil fuel prices has made renewables more competitive, but overall inflation has slowed down the replacement process.