Climate-neutral heating requires a significant transformation of the energy system. The heat transition thereby has to consider regional circumstances that significantly influence technology and system costs.
To address the challenges of these heterogeneities, researchers at the Institute of Energy Economics at the University of Cologne (EWI) have developed a tool designed to simulate the Levelized Cost of Heat (LCOH) in municipal regions. LCOH are the costs of one kWh of heat. They contain the investment costs for a technology as well as the operating costs over the entire operating life. The development of the tool was partially funded by the “Förderinitiative Wärmewende” der Gesellschaft zur Förderung des Energiewirtschaftlichen Instituts an der Universität zu Köln e.V.
By calculating the LCOH, it is possible to compare the costs of different heating technologies over their entire service lifetime. State-specific conditions such as building density, building types, or refurbishment statuses are correspondingly taken into account for cost determination. Local authorities and other institutions involved in the communal heat transition can use the tool and customize certain subsidies for different types of technology and interest rates or choose between different energy price scenarios.
Findings indicate, for example, that although the investment costs for gas heating systems are comparatively low, they become less competitive due to high operating costs in times of high energy prices. In contrast, capital-intensive technologies such as heat pumps, hybrid technologies and pellet boilers become increasingly attractive in these high energy price scenarios. Another critical variable for the cost-effectiveness of technologies is the building type. ” The cost per MWh for pellet boilers and air-to-water heat pumps, for example, decreases with an increasing number of apartments per building,” states Dr. Johanna Bocklet, manager at EWI. These findings complement the recently published EWI study on fucus areas as concepts for communal heat planning (“Fokusgebiete als Konzept der kommunalen Wärmeplanung“).
Focus areas prioritize the most cost-effective heat supply solution, taking into account the existing infrastructure, the specific heat demand and the generation potential of a region. The selection of the preferred, most cost-effective technology for a given region can be complemented by the calculation of the LCOH tool. “Both publications show that regional conditions and, in particular, the heterogeneity of the building stock must be taken into account for an efficient heat supply,” says Bocklet.