renewables, such as heat pumps, narrow investment evaluations underestimate long-term benefits, like reduced emissions, lower primary energy demand, and improved system resilience. A holistic, end-to-end framework is therefore recommended for guiding stakeholders in creating the long-term foundation for the transition. The objectives of the guidelines should be to:
Promote integration of renewables and surplus renewable electricity through tariff structures or grid- balancing mechanisms.
For Municipalities and Urban Planners 1. Introduce zoning for sustainable heat use
Direct new urban development to low-temperature- capable, DH-ready buildings.
Promote system-wide efficiency gains rather than localized optimizations.
Prioritize low-temperature building zones near renewable or waste heat sources.
Align investment decisions with long-term decarbonization strategies.
Designate high-temperature zones for buildings and industries that require elevated supply temperatures
Promote modernization that prepares infrastructure for low-temperature operation at both supply and demand sides.
2. Integrate district heating into broader urban sustainability strategies Align DH expansion with climate neutrality roadmaps, air quality targets, and resilience planning.
Promote urban energy planning that supports integration of renewable and waste heat sources.
Encourage partnerships between municipalities, utilities, and industries to utilize excess low-grade heat.
Existing EU policies such as the EED, RED, and EPBD provide a solid foundation for supporting DH. However, they could be further strengthened to unlock the sector’s full decarbonization potential. Recognizing the importance of holistic, system-wide evaluation for future investments, the following recommendations are proposed as supplements to existing EU policies.
For District Heating Utilities 1. Adopt wide-boundary assessment tools
Shift internal investment criteria from localized payback time to system-wide efficiency, fuel substitution, and emission reductions.
For National Governments 1. Mandate holistic evaluation frameworks
Standardize evaluation of improvements under multiple heat generation scenarios.
Require DH investment proposals to assess impacts on conversion efficiency, distribution, and end-use, while acknowledging that upstream fuel supply impacts may fall outside the operator’s control. Incorporate multiple future scenarios (e.g., biomass vs. heat pump baseload) into cost-benefit and socio- economic analyses. 2. Incentivize low-temperature building installations, design, and retrofits Provide subsidies, tax incentives, or mandatory building codes for low-temperature-ready heating systems (efficient energy transfer stations, emitters, insulation).
2. Prioritize long-term equipment standards
Require building installations, energy transfer stations, and control systems to be compatible with future low- temperature operation.
Phase in temperature optimization software and predictive control systems across networks.
Expected Outcomes Energy savings: Significant reductions in primary energy use, up to 2% per degree reduction in operating temperatures. Carbon reduction: Accelerated decarbonization by unlocking upstream efficiency benefits and better usage of low-carbon energy vectors.
Tie renovation supports schemes to compatibility with DH efficiency goals.
Economic benefits: Lower lifecycle system costs and greater resilience against volatile fuel prices.
3. Support flexible generation and integration of renewables Create frameworks that reward utilities for lowering operating temperatures to enhance system efficiency.
18 HOTCOOL SPECIAL COLLECTION edition 2, 2025
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