Sustainable deployment of energy efficient district heating: city business model

Heating and cooling account for 50% of the European Union's energy consumption and, therefore, reducing its impact is essential to minimise dependency on energy imports (particularly fossil fuel), which are bound to geopolitical conflicts. District heating arises as a critical player in this transition towards a more efficient energy framework. Despite its numerous advantages, implementation is still hindered by inadequate District Heating business models and incentives. This study conducts a holistic examination on the feasibility, effectiveness and, ultimately, the efficiency of establishing a publicly owned and public-privately managed District Heating infrastructure network via a pilot intervention in the city of San Sebastian in the north of Spain. A Value Proposition Canvas, Value Creation Ecosystem and City Model Canvas analysis provides insight into fundamental patterns and relevant recommendations for other municipalities trying to find a business model in which all the involved stakeholders can capture value while addressing at the same time the energy challenges of cities. •District Heating catalyses the transition to energetically efficient cities.•Analysis of publicly vs privately owned District Heating.•Research includes a pilot project in San Sebastian.•Business model is feasible and appropriate for all stakeholders.•Step forwards to enabling replicability of business model in other cities.