The Danish District Heating Association has assigned us to analyze the impact of phasing out the use of biomass in district heating. We have explored three scenarios of phasing out, all by 2035. In the first scenario, a 50 percent reduction is implemented. In the second scenario, a 75 percent reduction is implemented. In the third scenario, the phasing out of the use of biomass is 100 percent complete.

The use of biomass is set to be replaced by heat pumps and electric boilers, fueled by electricity from solar and wind parks. Consequently, the electricity demand is set to increase. Simultaneously, the electricity production from the thermal plants is set to decrease. Therefore, the capacity of onshore wind and solar parks needs to increase correspondingly.

Our analysis focuses on answering three questions:

1. How big is the need for new capacities of heat pumps, electric boilers, and onshore wind and solar parks?

2. How big are the changes in yearly costs and what are the investment and sunk costs for the phase-out?

3. What will the phasing out mean for land use?

Cost-benefit

A key factor is the replacement of costly biomass with sun and wind. Also, the life expectancy of the technologies has an important impact on the results. Solar and wind parks have a life expectancy of 35 years while thermal plants have 25 years. Boilers and heat pumps have a life expectancy of 20 years.

Meanwhile, the electricity production of solar and wind parks is less efficient. Consequently, the capacity needs to be higher than the capacity of thermal plants. Yet, the operational costs of solar and wind parks, boilers, and heat pumps are significantly lower than those of thermal plants.

The land use differs considerably. Phasing out the use of biomass could lead to a reduction of more than 90 pct. Land prices thus have a considerable impact on the bottom line.

Client: Danish District Heating

EML Team: Ida Græsted Jensen, Julius Lindberg Steensberg

Duration: April-June, 2024

Budget: DKK 126,000