Conference on District Heating Policy: Toward Sustainability

“District heating has the potential to make a substantial contribution to a sustainable energy future in Central Europe and the former Soviet Union” said Ambassador William Ramsay, Deputy Executive Director of the International Energy Agency (IEA) today at the start of an IEA conference on district heating policy in Prague. “These systems can do much to save energy and boost energy security, but stronger policy measures are needed to encourage wise management and investment.” With a stronger policy framework, district heating systems in formerly Socialist countries could save the equivalent of 80 billion cubic meters of natural gas a year through supply-side efficiency improvements. This is greater than total annual natural gas consumption in Italy.

District heating is a critical energy source for countries in transition and can provide a cost-effective, environmentally friendly source of heat and power for cities. It already covers sixty percent of heating and hot water needs in transition economies. Yet a large number of district heating systems in transition economies face serious financial and technical problems arising from the policy framework in which they operate. More efficient systems will also decrease costs, reducing household bills and making district heating competitive long-term.

Designed to focus attention on district heating policy in the region, the conference has attracted much interest, with over 100 participants from 26 countries, including five deputy ministers from the Czech Republic, Belarus, Lithuania, Moldova and Ukraine. The conference will highlight several areas where action is needed:

• Improving energy security with more efficient district heating
• Enhancing business practices and service-orientation
• Reducing overcapacity through competition or better regulation
• Encouraging technological leapfrogging to protect the environment
• Incorporating district heating in national energy legislation.

Today, 70 percent of Russian, Latvian and Belarusian homes use district heating, and heating accounts for one-third of total Russian energy consumption. So district heating is key to improving energy systems in these countries and ensuring their energy security.