Evaluating System Consequences of Energy Co-operation between Industries and Utilities

Sammanfattning: Energy conservation, energy efficiency measures, and energy carrier conversion within the industry are extremely important issues in order to deal with energy resource depletion and the threats from global warming. In Swedish industry there is potential for reductions of carbon dioxide emissions and resource use through utilization of excess heat and conversion of compression cooling to other cooling technologies using less electricity. Co-operation between industries and utilities can be obtained concerning both heating and cooling, but the choice of technologies and the profitability of co-operation are influenced by a number of factors such as the type of industry, policy instruments, the size and design of the district heating and cooling systems, and energy market prices.In this thesis, energy co-operation has been studied on two levels: a techno-economic level and a socio-technical level. On the techno-economic level the possibilities for co-operation in two industrial cases have been studied, Scandinavian kraft pulp mills and manufacturing industry in the municipality of Södertälje:The pulp and paper industry is one of the major energy users in Sweden, and 2.2 TWh of heat was delivered from pulp mills in 2007, mainly to district heating systems. At kraft pulp mills the excess heat can be used either internally or externally. Internally, excess heat can be used in the production process and/or to replace steam and thereby increase the production of electricity, depending on the quality of the excess heat. Externally, excess heat can be used as district heating. The trade-off between internal and external use of excess heat depends on numerous factors. The economic profitability of possible investments is influenced not only by investment costs and fuel costs; several policy instruments, including the electricity certificate system and the carbon dioxide trading scheme, also influence the choice of technology as well as the willingness to co-operate.In the municipality of Södertälje two large industries use large amounts of electricity, district heating and cooling. The cooling demand in Södertälje is currently covered by free cooling from lake water and compression chillers; but in order to reduce the use of electricity, conversion to heat-driven cooling or increased lake water cooling can be considered. The large CHP plant in Södertälje is today not used to its full potential, but investment in heat-driven cooling and/or a cold condenser unit integrated with the CHP plant could increase the plant’s operation hours. New investments in district cooling could increase the level of co-operation between the two industries and the local utility, but depending on policy instruments, energy market prices and the possible exchange of heat between Södertälje and Stockholm, the profitability of such investments will vary.On the socio-technical level, co-operation between utilities and industries has been studied through interviews and surveys to further analyze factors concerning co-operation beyond the techno-economic level. Results from the studies show that communication between the parties, the willingness to take risks, and trust between the co-operating parties are key factors that are as vitally important for a co-operation to take place as technical and economic factors.