Waste heat recovery in low temperature networks versus domestic heat pumps - A techno-economic and environmental analysis

The planning of energy infrastructures in new districts often follows the practice adopted for the rest of the city. In Stockholm, district heating is a common solution for multi-apartment neighborhoods. Recently, because of an average clean electricity mix, heat pumps have gained interest. However, European studies suggest to limit the reliance on electrification to avoid an extreme demand increase. Thus, an effort is required to improve the environmental impact of alternative options. This study proposes waste heat recovery in low temperature networks as a promising solution. By means of a techno-economic and environmental analysis, this option is compared to domestic heat pumps. A new approach is proposed to combine a district level perspective with simulation tools able to capture sector-coupling interactions. Scenarios, for a real neighborhood, assess waste heat recovery potential and electricity grid loading status. Results show that a waste heat recovery capacity equal to 10% of the peak load can reduce fossil fuel use of 40%. Local grid limitations are shown to be a bottleneck for the feasibility of domestic heat pumps. Their heat generation cost is 28% higher than for district heating. The carbon footprint is strongly dependent on the emission factor of the electricity mix (+11%/-24%). •A district level approach is key to capture energy sector-coupling interactions.•Waste heat recovery of 10% of the heat peak load can reduce fossil fuel of 40%.•Electricity grid loading limits are a bottleneck for additional electric loads.•Domestic heat pumps are not recommended in high heat demand density areas.•District heating can play a key role in the decarbonization of the energy sector.