District Heating - Who buys the heat?

Today more than half of Sweden is heated through district heating. In total, an estimated 3.5 million Swedes today benefit in some way from heat delivered by district heating, whether at home, on the job, or at school. That means the customers are very different, with everything from a family in a single unit house to a large hospital. There are about 570 communities in Sweden and the collected deliveries reach up to about 50 TWh. District heating still has a large potential to grow further, to the advantage of customers, society, and the environment. The number of customers increases all the time even if the trend itself grows slowly due to the time it takes to physically extend the district heating grids.

Competitors
District heating does not lack competition in the heating market. Basically all forms of heating can be seen as competitors to district heating. The largest among them today are electric heat and oil heat. One main competitive advantage of district heating is its simplicity. Once having installed district heating in your house you rarely need to worry about it. You have heat and hot water, it is clean, nice, and odorless and the dependability is as close to 100 percent as you can achieve.

The market is now developing where the customers are not only offered energy delivery but also the complete service of “heat” or “climate”. That means a full service commitment by the district heating company such as keeping the customer’s heat facility in the best condition.

Am I stuck?
The district heating companies are sometimes accused of having a monopoly on the market. Svensk Fjärrvärme, however, finds that this is a misconception. When a customer chooses a heating operation the competition is free and the customer can choose between different alternatives such as heat pump, electric heat, pellet burning, or district heating. When it comes to competition between the heat types it can even be an advantage to have district heating. Most district heating customers have the possibility to cancel delivery with three months’ notice, and can then choose another type of heating

One of the main competitive advantages of district heating is that it is resource saving and environmentally friendly. The industry now wants to sharpen the argument and hope that within a reasonable time to be able to sell ”green district heating”, i.e., district heating produced solely from renewable energy sources. But even today district heating utilizes resources that otherwise would have been lost.

Source: Svensk Fjärrvärme, www.svenskfjarrvarme.se/