HPAC Magazine

District Energy Heats Up Across Canada

October 1, 2014 | By PATRICK CALLAN

A lesser-known method of communal heating and cooling, which traces its roots to ancient Rome, is picking up steam throughout Canada. In a district energy network, hot and cold water travels in a closed loop from a generating station through underground pipes to nearby buildings that use it for heating, air conditioning and hot water.

For decades, the technology has been used across North America on university campuses, military bases and in larger cities. In Europe, modern district energy systems have been used extensively since the 1970s, and in some countries it is even mandated. 

District energy systems have three main components: a thermal energy plant with a boiler and chillers (which generates energy and in some cases can co-generate electricity), a thermal distribution network (pipes that transport thermal energy from the plant to end-users), and an end-user building interface (to transfer thermal energy from the working fluid to the buildings’ heating and cooling systems).

When buildings – industrial, institutional, commercial or residential – connect to a district energy system, they do not need to own and operate their own heating systems (boilers, furnaces, baseboards), cooling equipment (chillers, air conditioners, cooling towers) or water heaters. Natural gas, propane, waste heat, heat pumps, biogas/biomass and geothermal can all be used as fuel sources in district energy systems, which can transport heat up to 30 kilometres from any single heat source and hundreds of kilometres when multiple heat sources are combined.

District energy systems are often seen as a way to significantly reduce greenhouse gas emissions, free up building space, as well as lower fuel, maintenance and equipment costs. 

The Canadian Industrial Energy End-Use Data and Analysis Centre published a report in March 2014 on district energy systems in Canada and found there are currently 116 operating across the country, with Ontario and British Columbia leading the way at 34 and 25 respectively. The study discovered more than half of the survey’s 60 participants have commissioned their district energy systems since 2000, and the majority also reported planning some level of expansion to their operations in the future.

Brad Bradford, community energy planner and Canadian Desk at the International District Energy Association, says in many cases municipalities (like Guelph) are driving new district energy system starts, not just expansion, across Canada. In addition to the aforementioned environmental benefits, he explains there are other practical reasons as to why municipalities are opting for district energy systems.

“As we’ve seen an increase in more frequent and severe weather events, municipalities are starting to recognize that providing critical infrastructure is important to their communities,” he says. “They’re not necessarily prepared to rely on the grid that we’ve used for the past 100 years. They’re looking for something that’s more community-based, less susceptible to these sorts of shocks and stresses associated with climate change.”

With the grid there are hundreds of lines of exposed and vulnerable infrastructure, where energy or electricity has to travel over great distances, he adds. “With district energy, it’s in the community, it’s much smaller, close scale, and a lot of stuff is underground.”


Those in the know about district energy systems are quick to rattle off the many benefits they offer, however, as with any niche or up-and-coming technology, education is often the toughest battle. “I would say the biggest challenge is that people don’t know what district energy is,” says Manners. “You have to explain what it is to people before they really understand what the benefits might be.”

Daniel Engelberg, account specialist with Enwave, adds another challenge is fear of the unknown and traditional ways of thinking about heating and cooling buildings. “But if we can show them that we can compete with their other options, there’s no downside,” he says, admitting district energy does not make sense for everyone. “New developments that fit in our network that have a viable heating load would make sense as long as the proposal is financially feasible for both parties.”

Bradford, concedes that convincing companies to connect to district energy systems can be difficult, especially if they have recently spent the money to install boilers and chillers. “They’re going to say come back in 15 years,” he says, adding a key ingredient to district energy’s success hinges on timing and planning. “Doing the planning on the front end and working with the municipality to identify where the new developments are going to be, and the type of development, is really important,” he says. “Too often it’s an after-the-fact consideration.” <>

What’s in it for me?

It is no secret that reducing our carbon footprint is a hallmark of the modern era – and a top priority on many companies’ corporate agendas. As a result, more and more Canadian municipalities and businesses are turning to solutions such as district energy.

While many in the heating, venting and air conditioning community will take a wait-and-see approach towards district energy, learning more about this technology could help your business carve out a niche for itself and stay one step ahead of the competition. District energy experts agree that it could usher in new opportunities for mechanical contractors in regards to installation and maintenance.

Daniel Engelberg, account specialist with Enwave, which operates an extensive district energy network in downtown Toronto, says he relies on skilled mechanical contractors on a regular basis. “They do repairs, install new valves, repair valves and put in meters,” he says. “For anything to do with steam piping I use mechanical contractors.”

Brad Bradford, community energy planner and Canadian Desk at the International District Energy Association, adds that when it comes to a building’s condensing and high efficiency boilers, the same people who look after the windows or clean the floors often maintain them.

“A lot of the time there’s not dedicated staff managing the thermal assets within a building,” he says, adding, boiler plates can be installed at 80 per cent efficiency but without regular maintenance they will not be as efficient in five years. “But a district energy system is run by professionals that are optimizing all the equipment and maintaining it properly to make sure that you actually have that real world efficiency within the system.”

District energy goes mainstream

Guelph, ON is the first North American city to embark on a strategic plan to build a citywide district energy network that will supply at least 50 per cent of the community’s heating needs in the next 30 years. “In order to achieve the targets that are set out in Guelph’s community energy initiative, it’s necessary that the efficiency of heating and cooling homes and buildings be greatly improved,” says Sandy Manners, spokeswoman from Guelph Hydro, a key partner in the initiative. “And district energy is the solution.”

Guelph’s District Energ
y Strategic Plan identifies 10 nodes for district energy facilities. The first planned facility began operating at the end of 2013 in the Sleeman Centre, a sporting and entertainment venue. The system is owned and operated by Envida Community Energy, a subsidiary of Guelph Hydro, and serves as the central heating and cooling plant for the city’s Galt District energy system. It currently provides heating and cooling to the Sleeman Centre using natural gas to heat water in boilers and a central chilling unit to chill water. Soon the system will be expanded to heat and cool Guelph’s River Run Centre for the performing arts and other commercial and residential developments in the area.

Construction of Guelph’s second district energy facility, in Hanlon Creek Business Park on a 675-acre mixed use Greenfield site, is underway. Two heat sources will serve this site. One plant, located in the west end of the park, will generate thermal energy using natural gas. The other will be a combined heat and power plant that produces thermal energy and electricity. This plant will capture waste heat from industrial processes and use it to heat boilers or drive chillers to provide heating and air conditioning to clients of the district energy system. It will also have the ability to generate 10.2 megawatts of the city’s electricity (about four per cent), which will be fed into the provincial grid under a 20-year contract with the Ontario Power Authority. This facility is expected to be complete by the end of 2016.

Manners says the initial focus for Guelph’s district energy initiative is to attract commercial and industrial clients. As the program rolls out across the city, residential buildings will be added, beginning with multi-residential units. “From a cost effectiveness perspective it makes more sense if you have a certain density. So for individual residential homes, it doesn’t make an awful lot of economic sense right now,” she says. “But once the system is deployed throughout the entire community you would start to see residential homes added into the system.”



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