Costs of CO 2 Emission Reduction in Biomass-Based District Heat Production Systems

Efficient biomass-based district heat production systems (DHS) can contribute to achieving the social targets of environmental and energy security for countries with demand for space and water heating. In this study, we evaluate the costs of CO2 emission reduction from biomass-based district heating systems in comparison with fossil-based ones under different scales of district heat production, and we relate this cost to estimated damage costs of CO2 emission. Our calculations are based on a real heat load duration curve for a city in southern Sweden. The value of cogenerated electricity is assumed to be equal to that produced in minimum-cost standalone condensing power plants. The difference of the production cost and CO2 emission between fossil- and biomass-based systems is used to calculate the cost of CO2 emission reduction. We consider four different sizes of DHSs, from 50 to 300 GWhheat per year, to investigate how the CO2 emission reduction costs varies with the scale of DHS. We found that the district heat production cost for a minimum-cost DHS depends on scales of district heating systems and that the cost effectiveness between biomass- and fossil-based systems varies for different scales. The costs of CO2 emission reduction vary from €7.7 to €9.4 per ton of CO2e depending on the size of DHS. This cost is generally lower than estimated damage costs of CO2 emission.