DISTRICT ENERGY IN CITIESA GLOBAL INITIATIVE TO UNLOCK THE POTENTIAL OF ENERGY EFFICIENCY AND RENEWABLE ENERGY

Sudhir Sharma

Programme Management Officer, Energy and Climate Change

UN Environment, Asia Pacific Office

‘Converting Expectations’, an experts’ workshop to

catalyse adoption of Energy Efficient Solutions

Mumbai, 24th July 2018

District Cooling and Trigeneration

BUSINESS AS USUAL COOLING IS

NOT AN OPTION!

KEEPING INDIA COOL IN 2050

Need to scale-up technologies

that are:

• Cost-effective

• Efficient & renewable

• Shift peak demand

• Use alternatives to electricity

• Lower CO2 and refrigerant

emissions

• Can lower urban heat island

effect

• Provide local power system

resilience

Peak • 45% of peak demand

Power • 28% of power demand

GHG • 10% of all emissions

Climate • 13% hotter

Cities • 380 million more people

Based on IEA’s 2050 baseline

WHAT IS DISTRICT COOLING &

TRIGENERATION?

Adapted from IEA

District Cooling

Plant

(electric chillers,

trigeneration,

waste heat

absorption chillers

IT IS MORE THAN JUST EFFICIENCY

Source IEA

HIGH POTENTIAL IN INDIA

Target developments Target Consumers

Control

• Smart City areas & CBDs

• Integrated townships, campus

• Industrial areas, SEZs• Dense brownfield

sites• Gas connections

• Data centres, IT Offices

• Hospitals, hotels, malls, offices, conference centres

• Universities, public offices etc.

• HIG residential

• Municipal influence• Real estate portfolio• Large consumers

Opportunity: India is commissioning 3 million sqft. of commercial space per day (AEEE, 2017)

DLF CYBERCITY, GURGAON

TRIGENERATION DISTRICT COOLING

Trigeneration District Cooling

• 10 buildings

• 18 million sqft

• Power demand of 186MW served

by trigeneration

• Cooling demand of 78,000

refrigeration tonnes

• Total primary energy efficiency: 85%

Benefits

• Lower cost cooling for customers

• 100MW of power demand avoided

• 36,000tCO2 saved per year

• High reliability and resilience

• No harmful refrigerants

SCALING-UP INVESTMENT IN INDIA

Existing systems:

• China

• India

• Indonesia

• Japan

• Malaysia

• Philippines

• the Seychelles

• Singapore

• Thailand

Technology

• Gas supply & allocation

• Renewables

• Thermal storage

Policy

• City policies and planning

• Regulations (e.g. ECBC)

• Incentives (e.g. tax)

Financing

• Business models

• Contracting

• Funding mechanisms

Capacity

• Supply chain

• Local government

• Customers

• Real estate

District cooling & trigeneration is proven

globally and is growing across Asia-Pacific

Tailor and redevelop global best

practices for India

District cooling (without thermal storage)

DISTRICT COOLING IN INDIA:

PREPARING A PROJECT PIPELINE

CO2 savings 30-35%

Life cycle refrigerant saving (20 years) 10-15%

Water savings (compared to water-cooled

chillers)

15-20%

Electricity demand reduction. 30-35%

Peak power demand reduction 30-35%

Rapid assessments in 5 cities have identified over US$ 600 million in investment

opportunities Project have an average IRR of 14%.

Ravichandran Purushothaman, president, Danfoss Industries:

“With the launch of this new district cooling initiative in India, we are certain that these five identified

pilot projects will serve as the inspiration for many more such projects in the rest of the country.

Danfoss has implemented both, district cooling and district heating around the globe and we are now

looking to showcase this expertise in India as well.”

MUNICIPALITIES ARE CRUCIAL FOR

SCALE-UP

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Smart city

Solar city program

Baseline GHG

assessment

Low GHG plan /

target

City-wide efficiency

& renewables target

Efficiency &

renewable target by

sector

Zonal renewable

energy target

Zonal building

efficiency targetRe

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Bh

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Mandates on SWH and/or

PV by sector

Mandates on centralised

HVAC

Green building policy

Mandate on water re-use in

cooling

Mandates on building

certification

FAR bonus linked to

certification

Property tax rebate for

SWH installation

Direct investment in energy

projects

Public buildings to

demonstrate

Municipalities can accelerate district cooling and trigeneration through local policy and initiatives

STATE & NATIONAL-LEVEL SUPPORT

CAN UNLOCK THE MARKET

National/state-level recommendations

▪ Incorporate district cooling into national programmes and initiatives

e.g. Smart Cities, Solar Cities, National Cooling Action Plan, ECBC, Municipal Solid Waste

▪ Establish a regulatory framework

▪ Level the playing field: e.g. gas allocations; trigeneration power price reflecting local benefits;

lower off-peak electricity tariffs to encourage thermal storage; ensure fair VAT/GST on chilled

water sales and capital equipment; fair treatment of DC in ECBC & GRIHA

▪ Regulate the market: e.g. customer protection, tariff methodologies, licensing, standards etc.

▪ Establish a national unit

▪ standardize the market e.g. standardized methodologies, tools, contract templates, ToRs etc.

▪ manage a capacity support programme to cities

▪ grant support to cities to identify, assess and promote district cooling & trigeneration projects

▪ Establish a Revolving Fund to provide capital support to innovative DC & trigeneration projects to

leverage investment

DISTRICT ENERGY IN CITIES INITIATIVE

Accelerators: Buildings, Transport,

District Energy, Lighting, Appliances

and Equipment, Industry

Objective: Double Global Rate of

Improvement of Energy Efficiency by

2030

Funded by:

4 PILOT COUNTRIES

10 REPLICATION

COUNTRIES

43 PARTNERS

Key figures:

National Coordinator for India

THE DISTRICT ENERGY IN CITIES

INITIATIVE IN INDIA

▪ Thane, India’s first pilot city

▪ Full demonstration of technology, financing and enabling framework

▪ Two pilot projects and 20 year city plan for district cooling

▪ Replication to other cities across India

LIGHT TOUCH

PILOTS

NATIONAL

▪ 5 city rapid assessments (Bhopal, Coimbatore, Pune, Rajkot, Thane)

▪ Methodologies and tools developed and made for all cities

▪ More cities to be supported

▪ Virtual Platform & Outreach

▪ National support programme and regulatory framework

▪ National Cooling Action Plan

▪ National potentials study for district cooling

AREAS OF DISCUSSION

▪ How can gas price affect projects and how can this risk be

mitigated by projects and regulators?

▪ Expansion of gas and city distribution networks

▪ Taxation policies to support projects (e.g. on capital equipment

such as gas engines, VAT on chilled water etc.)

▪ Regulatory – municipal/state interventions on building codes to

facilitate district cooling and tri-generation market

▪ State electricity regulatory interventions to incentive district

cooling and tri-generation through power system

▪ Urban and state planning policies to promote district cooling and

trigeneration

▪ Financing and business models for district cooling and tri-

generation

THANK YOU!

For more information on the District Energy in Cities Initiative and to

become a partner, please visit the website or contact:

Sudhir Sharma, Programme Management Officer, Energy and

Climate Change, UN Environment, Sharma66@un.org

http://www.districtenergyinitiative.org

THERMAL STORAGE ENABLES

RENEWABLES & LOWERS COSTS

Sample 2 days of cooling demand in April 2050 with and without thermal storage

Source: IEA