RENEWABLES FOR HEATING AND COOLING

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RENEWABLES FOR HEATING AND COOLING ( renewables-for-heating-and-cooling )

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and are also often exempted from sales taxes. These price differentials lead to REHC technologies competing in, for example, households better than in the industrial sector. Table 4 Suitability of renewable energy resources to meet various categories and scales of heating and cooling applications Application Solar thermal Solid biomass Biogas* Biomass from waste Shallow geothermal Deep geothermal Dwellings x x (x) x Settlements (district heating) xxxxxx Commerce and service x x x x Agriculture x x x x x x * Biogas for cooking is produced at the micro-scale in developing countries using domestic and animal wastes. At the other extreme using large scale plants scrubbed biogas can be fed into gas grid pipelines. Neither of these options is considered in detail in this report. Each conventional energy carrier has its own price range (Table 5) so substitution opportunities using renewable energy vary widely. For example, electricity is a relatively high-priced energy carrier whereas fuel oil, especially when used in oil-producing countries, has been relatively cheap. Cost effective opportunities for REHC are therefore greater when substituting for electricity rather than for fuel oil. The price of the energy carrier is determined by the primary fuel cost plus transportation and distribution costs and any excise taxes imposed by governments. In remote regions where energy is provided from diesel fuel or bottles of liquified petroleum gas (LPG), the use of local renewable energy can add value by avoiding the relatively high transport costs. Traditional biomass used for basic cooking and heating is usually locally available at very low cost but is converted to heat at very low efficiencies of less than 10% on open fires. Using a more efficient enclosed cooking or heating appliance with a flue can reduce the fuel input and also add value from improved health benefits. However investment costs for such appliances, even if very simple, are often difficult to meet for the very poor. Table 5 Real and indexed electricity, gas and light fuel oil prices (average values for OECD countries) when delivered to industry or households 35 Industry x x x x x Real prices Indexed prices Industry Households Industry Households Natural gas USD/GJ €/MWh 3.8 11.0 8.4 24.3 100 220 Electricity USD/kWh €/MWh 0.06 0.10 48.0 80.0 100 167 Light fuel oil USD/toe €/MWh 279 19.2 423 29.1 100 152 Source: IEA, 2006c (2002 data chosen for consistency). 1 USD = € 0.8 (2006) Successful competition of REHC options are dependent on the cost of delivering heating and cooling, the energy prices paid in each demand sector, on the fuel type to be substituted and its costs. However

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