May I (Re-)introduce You to District Energy?
June 5, 2012

For the past decade, district energy has slowly been waking from a long slumber, and now is the time for cities across the country to rediscover the value of district-scale energy solutions.

Throughout the 20th Century, cities facilitated or oversaw the creation of these systems, and it was only in the last 20 years of that century that district energy disappeared from our communities. Unlike Rip Van Winkle, though, district energy can quickly become part of our lives again.

In its simplest terms, district energy is a shared system for providing heating, cooling, and hot water to a cluster of buildings. Building owners participate in district energy to gain benefits from more efficient energy use, access to better energy-producing technologies, and the service of a utility business model instead of standalone systems in their own buildings.

With such obvious benefits, why did we shift away from district energy? Primarily because, by and large, building owners are not good investors when it comes to energy. They lack information about energy systems and the time to gain that information, and they won’t put money into something that doesn’t pay for itself right away.

Building owners often do not make smart choices for building energy systems because those smart choices usually have financial paybacks of more than three years. While short-term rewards might be fine for many kinds of consumer products from electronics to trendy clothing, it makes no sense at all for energy equipment.

Recently, many cities have begun taking another look and are finding that district energy offers a real opportunity to address their energy challenges. Whether they are championing strategies to secure energy supplies, insulate themselves from price instability, or reduce greenhouse gas emissions, these cities recognize district energy’s ability to do all three of these things simultaneously.

New Energy Cities has highlighted district energy as a key strategy that cities can pursue to create systems that can achieve greater efficiency, facilitate the use of more clean, renewable forms of energy, and use long-term capital to improve economic performance and reduce obligations on individual building owners.

Seattle-based Preservation Green Lab is a program of the National Trust for Historic Preservation that has become a strong champion for district energy in keeping with its role of helping existing buildings address energy use issues. The Lab has produced a primer for cities interested in pursuing district energy that highlights some key points, such as:

  • Understanding the need to assemble the combined energy demand from a neighborhood of buildings
  • Identifying policies that cities need to consider to improve the success of the system
  • Engaging building owners early and often

District energy is part of an emerging shift toward looking at energy efficiency opportunities beyond the boundaries of individual buildings and recognizing the inherent value of providing energy for contiguous buildings to improve the energy performance of our built environment.

This work is important for those who are interested in welcoming the Rip Van Winkle of energy back home.

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