Axel Gedaschko - Danfoss.com

Preben Tolstrup:
focus on disTricT
energy in The eu
issued by Danfoss District Heating
District heating by Danfoss
Tarjei
Haaland
Greenpeace expert talks
about CO reduction
2
Axel
Gedaschko
Hamburg as German
pioneer within DH
#2
#1

AGENDACONTENTS2008
10
Q&A
Climate and energy expert
from Greenpeace Tarjei
Haaland shares his views on
the economic and enviromental
benefits of cogeneration and
district heating.
06 News
Danfoss success in Italy, Poland
and Hungary and lots of other
exciting news from the local and
global world of Danfoss.
20 Danfoss World
Dirk N. Ockhuizen elaborates on
the effects of recent years’ flexible
energy policies in the Netherlands.
14
Discussion
District heating network
should be massively
extended in Hamburg.
Academy
District energy is one
of the best-kept secrets
in the energy world
according to CEO of LOGS-
TOR, Preben Tolstrup.
26
24 Solutions
Tony Nielsen, Scandinavian Sales
Director for Danfoss EnergyTrim,
outlines the principle of the
company’s service agreement.
30 Gadgets
A collection of smart ideas for
business and pleasure.
agenda 3

4 agenda
HEATEDDEBATE
Our biggest challenge is to extend the
message about the efficiency and environmental
benefits that district heating
and cooling yields beyond the converted.
Sharing knowledge and best-practice
principles is key to creating greener and
smarter energy systems – an issue on
which we are at last globally united.
Understanding how to utilise waste energy
as a means to master energy optimisation
is paramount. Research has
demonstrated that big plants are more
efficient and far less polluting than small
plants, and that district heating is a valuable
solution for utilising the untapped
potential of waste energy.
Industry must be motivated to take responsibility
for waste energy and rethink
it as a resource. Approximately 75% of
the district heating in Denmark is a byproduct
from producing electricity. It is my
hope that this benchmark will continue to
grow, and that it will set an example to
other countries that strive to improve its
energy systems.
There is a trend for the world energy market
to focus exclusively on renewable solutions.
It is important for stakeholders to
understand that district heating is a flexible
infrastructure that can utilise, for example,
biomass to great effect – not only
in the future, but in the here and now.
Danfoss takes its role in keeping district
heating on the political agenda of future
energy systems seriously. Not only because
it is the cornerstone of our business,
but because it is an effective way
to tackle the challenges the world faces
in terms of safeguarding our planet. We
are not only working closer than ever
locally with Danish politicians, but we
are increasingly active in our efforts to
help steer policymaking at EU level and
prompt knowledge-sharing across borders.
To this end, I am delighted that
German Senator Axel Gedaschko contributes
his voice to this edition. He helps
delineate the political dimensions of district
heating, as well as share the positive
impact it has made as a growing energy
solution in Hamburg.
Our work on this front is also supported
by positive contributions from environmental
and pressure groups who share
in our vision. We respect Greenpeace
exploiting opportunities to generate
knowledge and advocate positive action
with such campaigns as the recent
‘Decentralised energy – what are we
waiting for?’ information film.
I believe our attempts to switch people
onto the benefits of district heating has
gained momentum and is impacting
change. The latest directives from the
EU Commission recommend district
heating as a progressive and efficient
energy system for new area developments.
It is a recommendation, not
legislation. But it is a step in the right
direction, and confirmation that our
message is getting through.
The Danfoss promise of ‘making modern
living possible’ is a reality that drives all
that we do. We are as faithful to creating
environmentally efficient solutions that
limit eco penalties as we are to developing
technology that redefines comfort. In
combination, this affords us the ability to
lead the industry and make a difference.
Jan Matzen
Vice President Sales,
Danfoss District Heating
#2
#2, 2008. Danfoss A/S: Danfoss District Heating, 6430 Nordborg, Denmark, Tel +45 7488 2222, www.dh.danfoss.com.
issued by Danfoss District Heating
Editor: Tine Frandsen, tif@danfoss.com. Publisher: Weis & Co. ApS, Middelfartgade 17, 2100 Copenhagen Ø, Denmark, Tel +45 33 366 266, lars.weis@weis-co.uk.
#1
Art Director: Anna Ax. Copywriters: Rob Holder, Paul Barfoot, Frank Grotelueschen.
District heating by Danfoss
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A view from the top
An elegant spiral staircase
stretches from the ground
floor of the headquarters
building to a glassed-in room
with a sweeping view of the
entire Danfoss campus.
agenda 5

News Danfoss highlights
6 agenda
Best iN show
The annual AgfW (Arbeitsgemeinschaft
fernwärme) conference
is a key event in the industry
calendar. As a major player in the market,
danfoss will be exhibiting 80 m 2
of heating solutions and technology at
the supporting exhibition.
New stakehold iN italy
danfoss has been very active in italy, both in the sale
of components and delivery of stations, as well as
developing a network of local partners and distributors.
in order to consolidate our presence in one of the fastest
growing european district heating markets, we are delighted to
announce the opening of a sales office in Turin.
ezio gagliardi will head up the sales force as sales Manager.
he brings years of valuable experience and knowledge of dan-
We anticipate that our hot water systems
with Legionella protection will
be a showstopper for delegates.
Legiokill® products have set new
standards in anti-Legionnaire solutions
for domestic hot water, and danfoss
is proud to present them following an
acquisition of dMs Wasser-Wärmetechnik
gmbh.
Alongside, house and flat stations will be
exhibited in conjunction with our portfolio
of electronic and self-acting controllers,
control systems and actuators.
Make a date to visit us at the entrance
of hall 4, 8–10 April 2008, Bremen
exhibition & conference centre.
further info: www.waermemesse.de
foss’ products to the post, and he will be proactive in responding
to the growing trend for flat stations.
“The market is demanding more and more solutions alongside
components. our stations put us in a very strong position,
and supported by a wide range of components we are able to
deliver complete heating solutions for individual houses and
apartments. This is a great opportunity for danfoss, and we
have high expectations for our future in italy,” reports gagliardi.

streamliNed sales success
iN polaNd
danfoss LPM is pleased
to report an increase
in the quality and volume of its
sales chain as part of the danfoss
sales Program (dsP).
during Q1 and Q2 of 2007, the
danfoss LPM sales team created
work streams to evaluate
and improve key sales processes,
and implement new
sales tools. As a result it closed
2007 an impressive 19% above
target.
opportunity Project Management
has increased the competitiveness
of the company’s
offers, while Pocket Margin
analyses have helped eliminate
surpluses after cost collection
at the close of contracts for cus-
tomised products.
sales force efficiency has
been improved by increasing
direct selling time. This was
made possible by repositioning
70% of sales Managers’ quotations
to the Technical sales
support department, which
is equipped with new website
tools to enhance the flow and
response rate of quotation and
dimensioning enquiries.
Work on micro-segmentation
of Polish district heating utilities
is ongoing and will provide
a platform for us to align the
whole company based on a
value chain that will be responsive
to customers, and increase
danfoss LPM’s efficiency and
profitability within the domestic
Danfoss highlights News
daNfoss equips
huNgariaN homes
széphő Zrt district heating
company and széphő Ltd installation company
recently collaborated on a 24-flat housing
project costing in excess of 1.1 million euro as
part of an initiative to increase residential property
in the hungarian city of székesfehérvár.
danfoss was commissioned to equip the new
homes with a primary substation, 24 VMTdf-1
flat stations and 24 TP7000 thermostats.
A 600 litre-capacity buffer tank was also installed
for the liquidation of the peak load.
The heating and hot water system boasts
minimal heatloss, low operational distribution
costs, localised and accurate cost allocation
and anti-Legionnaire technology.
The Mayor of székesfehérvár praised the
building project as a great example of how investment
can raise the standard and volume
of accommodation in the city.
agenda 7

NewsDanfoss highlights
8 agenda
record growth BriNgs
daNfoss closer
A growing number of european acquisitions by
danfoss district heating has contributed to record
growth and provided an opportunity to work more closely
with local customers.
The latest buy-in to the swiss company Proenergie Wärmetechnik
marks the tenth corporate purchase in the last
five years. danfoss has a steadfast team committed to
strategically develop a portfolio of acquired companies as
competence centres, as well as manage reinvestments and
increase penetration of new markets.
direct contact with customers in local markets and boosting
production capacities on several local sites is key to
strengthening danfoss’ ability to provide the right products
at the right time. Being responsive to customers’ needs is
as important as our commitment to the quality and innovation
of the district heating solutions we deliver.

watertight acquisitioN
We are pleased to welcome dMs Wasser-
Wärmetechnik gmbh to the danfoss stable.
A deal was sealed in Q3 of 2007 for danfoss
to take over the company’s marketing, sales
and technical services.
in the last two decades dMs has become a
centre of excellence in developing, producing
and marketing anti-Legionnaire solutions
for domestic hot water with integrated
thermal disinfection of the circulating water.
it has been particularly active in the german
market, and made headway in Austria, italy
and switzerland.
“With this agreement, we will strengthen
our already very successful business within
complete solutions for the domestic hotwater
market. our ambition is to be a clear
leader within this field and it is therefore vital
for us to be at the forefront where the market
is developing, such as in anti-Legionnaire
solutions,” announced niels B. christiansen,
danfoss’ Vice ceo.
Danfoss highlights News
improved coNNectioNs for
cliNical ceNtre iN serBia
it has been three years in the making, but a project
to remodel the heating and hot water supply of
serbia’s central medical facility, the clinical centre
of serbia, is near completion.
following a 2005 pilot, World Bank announced a
tender in 2006 for the reparation and reconstruction
of substations for the serbian hospital.
collaborating with Projektomontaza as contractor
and TrAco as installer, danfoss was commissioned
to supply substations for the initiative.
A total of 58 substations, with a capacity of 53MW
for heating and 9.8KW for domestic hot water, will
have been delivered and connected by completion
of the project later this year.
agenda 9

A Sensible Solution
According to Tarjei Haaland, there is an overriding logic behind the
cogeneration of heat and power, along with increased use of district heating.
Taken together, these steps vastly increase efficiency and reduce waste
and have wide-ranging economic and environmental effects. And, as the
example of Denmark shows, cogeneration and district heating present an
eminently achievable solution to CO 2 reduction and energy security.
TExT ROB HOLDER, PHOTOS REIMAR JUUL
District heating is mentioned in a
variety of economic and environmental
contexts. What is the key to
its effectiveness?
There are a lot of good things to say
about district heating. It’s an essential
part of cogeneration and an excellent
way to harness the energy that goes to
waste in power production. It’s simple,
effective, environmentally friendly, easy
to use and robust against fuel price variations.
District heating is also very flexible,
because you can heat up water in
many ways – making room also for using
solar and geothermal heat. Remember
that basically what we’re talking about is
delivering heat via a water-borne system
– all you need to heat a house is 70-degree
Celsius hot water.
Is the use of district heating in Denmark
useful as a model for energy reform in
other countries?
My experience and opinions are largely
based on the Danish example. It’s a fact
that Denmark is well in the lead when
it comes to district heating – especially
district heating as part of cogeneration of
power and heating. Denmark is remarkable
because it has managed to a large
degree to “unbundle” rising GNP from
energy use: unlike most other developed
countries prime energy use has remained
more or less constant since 1980, while
GNP has increased by 75 percent. This
is not only because district heating is so
widespread in Denmark – delivering 60
percent of the heat demand for 1.5 million
houses – but also because about
82 percent of district heat in Denmark is
produced through cogeneration.
So, Denmark holds a clear example of potential
energy savings for other countries.
A European study made by Euroheat &
Power shows that district heating’s share in
Tarjei Haaland Q&A
Europe is only 9-10 percent, and that just
doubling this would lead to a CO 2 reduction
of 400 million tonnes a year – a reduction
of nine percent compared to today’s
CO 2 emissions in Europe. Many European
countries – Norway, Sweden, France and
others – use a lot of direct electric heating
for houses, a practice that Amory Lovins,
an American energy expert, said years ago
is about as efficient as “cutting butter with
a chainsaw”. Using high-quality electricity
– which should be used to power machinery,
lighting and so on – for home heating
is a tremendous waste.
What are some of the specific benefits
that could be realised by more
widespread use of district heating?
Greenpeace has developed a Nordic
energy scenario. It shows that Norway,
for instance, uses four times as much
electricity per capita as Denmark. Sweden
uses 2.5 times as much, and Fin-
agenda 11

Q&A Tarjei Haaland
12 agenda
“In Denmark, district heating has been around so long and is so successful that
it tends not to be discussed. It still has an important part to play, but there is a need
for study and analyses of its role in a future with increased insulation in the existing
building stock and the phase-in of new low- to zero-energy houses.”
land is similar. Even when adjusted for
Norway’s need for power to run certain
industries, such as aluminium production,
household use is four times that
of Denmark. Why? Mostly because of
their abundant hydropower, they use
direct electric heat for their houses, as I
mentioned earlier. This is certainly not a
clever way of using electricity from existing
hydro power.
Our scenario explores the result of
gradually replacing direct electric heating
with water-borne district heating
systems in towns. If that were to
happen, then you set free lots of hydroelectricity,
which could be used to
replace nuclear power in Sweden and
Finland and coal power in Denmark
and Finland. There are a total of 14 nuclear
reactors in the Nordic region – 10
in Sweden and four in Finland. They
produce an amount of electricity only
slightly greater than what’s used today
for direct electric heating of homes in
the Nordic countries. So, as a theoretical
example anyway, replacing direct
electric heating with water-borne
systems could eliminate the need for
nuclear power in the region, and help
reduce dependence on coal plants. It’s
certainly not as simple as a one-to-one
substitution, but these examples show
you the potential of cogeneration and
district heating in reforming future energy
systems.
Just converting existing power plants to
cogeneration facilities would be a big step
in the right direction. Typically, in most
Nordic countries outside Denmark and
throughout Europe, power plants produce
only electricity. Many are located not far
from towns and should be converted to
cogeneration plants for district heating
use. There are also many plants that produce
only heat, and in Denmark many of
these have been converted to cogeneration
facilities. With cogeneration you save
a tremendous amount of fuel over what it
takes to produce heat and electricity separately.
You increase efficiency, reduce CO 2

and decrease dependence on uncertain
supplies of fossil fuel – from the Middle
East and Russia, for example.
What are some of the roadblocks to
wider adoption of cogeneration and
district heating?
One big problem is that support for cogeneration
in the recent EU commission
directive was weakened by opposition
from major European electricity companies,
who want to produce only electricity.
They’re definitely not allies when we
talk about conversion to cogeneration
and district heating. So from one point
of view, it’s a struggle between big centralised
electricity producers and local
communities who want a more sensible
system. On a larger scale, you can see
it as a question of government regulation
versus the free market. If we continue accepting
only the market as a driver, then
politicians have to provide leadership.
Either governments will have to make
the market for cogeneration and district
heating more economically interesting
and secure for private investors, or make
it more expensive to use traditional separate
heat and power generation.
Is it also a question of countries being
unwilling to undertake the expense of
switching to more efficient systems?
Of course there are costs involved, but
nothing like the costs of not switching
over to more efficient systems. Nicholas
Stern, a former chief economist for the
World Bank, recently compiled a report
for the UK government which projected
that in the future it will cost between five
and 20 percent of GNP to do nothing
about climate change and about two
percent of GNP to take action. In other
words, it’s cheaper for society to act than
to continue “business as usual”. The investment
costs needed to reshape our
energy systems to emit less CO 2 is more
than compensated by the saved costs of
buying more and more expensive fossil
fuels. Similar arguments can be applied
to cogeneration and district heating. In
Denmark this was handled through a
Tarjei Haaland Q&A
big infrastructure investment supported
by the government in the 1980s, so the
Danish example needs to be strongly
used to make the point. It’s a bit of an
uphill battle at this stage – it should be
happening more quickly than what we’re
seeing now.
And remember that we’re not talking
only about protecting ourselves against
rapidly increasing fuel costs, especially
oil, but also about the broader social
and environmental impacts, such as
CO 2 -produced climate change and the
health effects of burning coal. These external
costs are only marginally reflected
in the price of coal, for example, which is
why it continues to be used heavily, even
though, were these costs factored in, it
would be seen as the most expensive
way to produce electricity. You can view
this as a huge market failure, because
the true costs aren’t internalised by the
market – so what is needed is for governments
either to tax dirty fuels more heavily
or subsidise clean ones.
agenda 13

DIsCUssION Axel Gedaschko
14 agenda
Renaissance
of district heating
Compared with many other EU
countries, district heating has
been used only on a relatively
small scale so far in Germany.
The North German metropolis
of Hamburg, with an extensive
district heating network, is one
exception. Those responsible,
such as Axel Gedaschko, State
Minister for Urban Development
and Environment, plan to
further expand district heating
in the future as an environmentally
friendly form of energy.
TExT FRANK GROTELUESCHEN, PHOTOS MIKKEL STRANGE
Hamburg – tHe DIstrIct HeatIng
capItal of germany
nineteen percent of all households in hamburg are supplied
with district heating, compared with the german average
of only 8 percent. Axel gedaschko believes that the
hamburg district heating network should be massively
extended: “A new coal-fired power plant is to be built in our
city and we have made it a condition that this power plant
should generate significantly more combined heat and power
than originally envisaged by the energy supplier Vattenfall.
in addition, Vattenfall is committed to massively extending
the district heating distribution lines at a cost of around
50 million euros. The new distribution lines will connect the
districts of Wilhelmsburg and harburg in the south of hamburg.
only small amounts of district heating are currently
available in these areas and we hope to be able to connect an
extra 25,000 to 30,000 homes. in addition, we plan to further
consolidate the network in the north of hamburg. our aim
is to connect a further 50,000 homes to the district heating
network by 2020. This is a realistic goal.”

District heating plant
at HafenCity Hamburg:
With a thermal output of up to 300 megawatts, the district
heating plant built in 1999 supplies district heating to
parts of HafenCity. Situated in the former harbour area,
this is a newly developed district of Hamburg with attractive
offices, residential buildings and cultural facilities.

DIsCUssION Axel Gedaschko
16 agenda
in terms of district heating use compared with other eu
countries, germany ranks in the middle of the eu-32
and is therefore completely average. According to Axel
gedaschko, this is partly due to germany’s housing
structure: “district heating lends itself particularly to large
conurbations. The high capital costs make it less cost-
effective in provincial areas. The average location of
district heating systems in germany is also historically
based, since a district heating system can’t just be built
overnight, it simply doesn’t work like that.”
tHe aDvantages of DIstrIct HeatIng
for a long time district heating in germany was discredited
as being more expensive than oil or gas. But this has
now changed and today it is more reasonably priced. Although
the capital costs for the district heating network
are rather high, the variable costs have not risen as sharply
in recent years as for gas and oil heating systems. Axel
gedaschko puts this down to the mix with which district
heating is generated here in hamburg: “This mix is based
mainly on coal and gas. in recent years, gas prices have
risen sharply. if we want to absorb these costs, residents
must accept coal-fired power stations to generate district
heating. Vattenfall is planning to replace an old coal-fired
power station in hamburg with a new, modern version. in
our city this project is not without its critics, but because of
the german federal government’s commitment to phasing
out nuclear energy, we must bite the bullet and permit
coal-fired power plants for a further generation, with the
proviso that cogeneration is significantly increased.” he
is also quick to point out the additional positive spin-off:
“Less cooling water from the power station goes into the
elbe, more goes into the district heating network. And that
is a very good idea.”
district heating also contributes to climate protection: replacing
oil or gas heating with a district heating connection
will save on average 0.7 tonnes of co 2 emissions per
household per year. district heating is therefore a very
cost-effective way of saving considerable amounts of co 2 .
energy mIx anD reDuceD energy consumptIon
if you ask Axel gedaschko for his opinion on the correlation
between district heating and the development of

“Our aim is to connect a further
50,000 homes to the district
heating network by 2020.
This is a realistic goal.”
new energy forms such as wind power, biomass and solar
energy, he stresses that our first priority should be to try
not to consume energy in the first place. “hamburg is the
first of the 16 federal states to issue a climate Protection
Act. it stipulates that a new building must consume 30
percent less energy than currently authorised under federal
law. We are now extending the act to include existing
buildings: we aim to ensure that roof spaces are insulated
and that single-glazed windows are replaced with doubleglazed
windows. reducing energy consumption is the
best way to reduce our impact on the environment.”
The second point is the energy mix: “We are building a
new quarter here in hamburg, the 150-hectare hafencity,
on the banks of the elbe and right beside the city hall. We
have held a europe-wide tender competition for the supply
of district heating to this quarter with an energy mix
which includes renewables. i believe that this is where the
future lies. Take hot water, for example: this can be supplied
by solar energy. We have also installed a large fuel
cell for supplying energy in the hafencity. it’s all down to
the mix.”
Axel Gedaschko DIsCUssION
Axel Gedaschko
After the Abitur (the German higher education
entrance qualification) in 1980 and military service
in the German armed forces, Axel Gedaschko studied law in
Hamburg and Göttingen. In 1988 he sat the first state bar
exam, majoring in administrative law and public administration,
followed by the second state bar exam in 1992.
From 1993 to 2000 he was employed as Senior Legal
Counsel for the state of Lower Saxony. In November 2000
Gedaschko was elected as Principal Municipal Councillor
(Erster Kreisrat) for the Harburg district and in 2003 he
was elected as chief administrative officer. In 2006 Ole von
Beust, First Mayor of Hamburg, appointed him Councillor
of State for Urban Development and Transport in Hamburg.
In January 2007 he became the State Minister for Urban
Development and Environment. Gedaschko’s main political
priorities concern how Hamburg can face up to the challenges
of climate change and its repercussions, including
the expansion of the district heating system and the pivotal
role of CO 2 reduction strategies. The 48-year-old is a father
of two and a member of Germany’s Christian Democratic
Union (CDU).
agenda 17

DIsCUssION Axel Gedaschko
18 agenda
“It is now largely down to the energy
producers not to abuse their market
position. In Germany we have a
regulatory system for the power and
natural gas grids. We need something
similar for district heating, too.”
district heating can also help to ensure that germany
achieves the eu emission targets for co 2 . When redeveloping
any urban area, urban planners must always bear
in mind the expansion of the district heating system. And
when building new power plants it must be ensured that the
heat produced is used via cogeneration to produce district
heating. Axel gedaschko believes that “there is no other
way to achieve the associated increase in efficiency. if we
increase the insulation in our homes at the same time, we
will need less district heating in these houses. That means
that in the future we will be able to supply considerably
more homes with the same total volume of district heating”.
tHe Image of DIstrIct HeatIng In germany
in the past, district heating had a negative image due to
its comparatively high cost to the end consumer. for this
reason, district heating was not particularly popular in
germany. Axel gedaschko is convinced that the time is
now ripe for a renaissance in district heating, provided
that those responsible take the opportunity. “it is now
largely down to the energy producers not to abuse their
market position. in germany we have a regulatory system
for the power and natural gas grids. We need something
similar for district heating, too. only then can other
suppliers compete alongside the current energy provider.
for example, in hamburg many industrial firms generate
heat, which could also be fed into the district heating network,
thereby reducing co 2 emissions. it is just a matter
of giving these producers access to the district heating
networks and paying them the true market value of the
thermal energy, rather than a dumping price. We are still
some way off from making this a competitive market.”
According to gedaschko, the cost of constructing district
heating networks has been the main impediment to the
expansion of district heating to date. “since buildings will
be better insulated in the future and will therefore require
less district heating, we must assume that the share of
network costs compared with consumption costs will increase.
The challenge to engineers, therefore, is to develop
processes which will enable district heating pipelines
to be laid in the most cost-effective way possible. in addition,
municipalities must design the pipeline wayleaves in
such a way that they are acceptable to those building the
pipelines. This means that the municipalities should not
act to drive up the price. And finally, reliable state funding,
as currently scheduled by the federal government, must
be provided in the long term. After all, district heating is a
long-term commitment and one or two-year funding programmes
are of little use.”

commItteD to a future WItH DIstrIct HeatIng
Axel gedaschko is personally committed to forging ahead
with the expansion of district heating. “We have specifically
ensured that Vattenfall significantly increases the amount
of cogeneration at the new coal-fired power plant in hamburg:
from the original 450 megawatts (MW) to 650 megawatts
(MW).”
With regard to the statutory framework requirements, he
refers to the current draft bill on cogeneration, which could
come into force this year. This draft provides for state funding
to subsidise the expansion of district heating. “since
other sources of energy, such as solar or wind energy, are
heavily subsidised, it would be a fatal distortion of the market
if district heating were allowed to fall by the wayside.
for this reason i believe it is right to use state funding with
the aim of extending district heating. in terms of figures,
this means that the federal government will subsidise combined
heat and power generation in the future to the tune of
up to 750 million per year. And that also includes subsidies
for constructing the district heating networks. i think this is
the right way forward,” explains Axel gedaschko.
he is convinced that district heating via cogeneration
will undergo a renaissance. “With the right energy mix, it
could even be a little cheaper than gas heating. on bal-
Axel Gedaschko DIsCUssION
ance we will need less energy for heating, because europe
as a whole is investing massively in home insulation. consequently,
although total sales of district heating will not
increase dramatically, its percentage share of the heating
supply should increase. The cost of the networks will be
crucial to the economic success of district heating,” concludes
Axel gedaschko.
Hamburg
With just under 1.8 million inhabitants, Hamburg is Germany’s
second largest city and the seventh largest in the EU. The
Hanseatic city is an autonomous city state and one of the 16 German
federal states. Hamburg’s first district heating pipelines were constructed
as early as 1893 and the city currently has a district heating
network which extends to 740 km and supplies 410,000 homes. The
combined heat and power system (cogeneration) generates 1,450
megawatts of heat and 450 megawatts of electricity.
agenda 19

DANFOss wOrlD The Netherlands
Macro benefits from
micro-networks
20 agenda

The Netherlands DANFOss wOrlD
The Netherlands is known for its strong commitment to maximising the
benefits of a wide range of energy technologies. Dirk N. Ockhuizen,
Director, AGH Warmte-units b.v – Member of the Danfoss Group, provides
a look at the economic and environmental advantages of combining heat
pumps and district heating in micro-networks such as the one Danfoss
recently completed for a community of 200 homes in The Hague.
TExT ROB HOLDER, PHOTO DEN HAAG MARKETING & EVENTS/ARJAN DE JAGER
agenda 21

DANFOss wOrlD The Netherlands
22 agenda
A prime example of enlightened and flexible energy policies in
the Netherlands is the liberalisation of energy laws, which effectively
deregulated the way energy is bought and sold. Previously,
consumers had no choice when buying energy. Under the new
laws, anyone – from major purchasers to individuals – is free to
buy electricity and gas from any Dutch power supplier. This frees
companies or even small groups of individuals to build their own
micro-networks for heating and energy, since they are no longer
tied to a specific power supplier. “A builder can use whatever
energy company provides the best price,” says Ockhuizen,
“then supply a self-contained substation to provide heating,
cooling and hot water. This is accomplished with a combination
of heat pumps and district heating via micro-networks that can
serve a wide range of environments, such as neighbourhoods,
multi-residential dwellings, shopping centres, hotels and hospitals.
The substation installation includes heat pumps, boilers,
storage tanks and controllers. It’s a self-contained local solution
that provides turnkey energy plus heating and cooling – all the
builder needs is a power plug and gas supply.”
a WInnIng combInatIon
The combination of energy supply with heat pumps and district
heating offer significant economical and environmental advantages,
and the Netherlands offer an ideal location to realise
them. The concept of district heating – which increases energy
efficiency by using a local distribution network of insulated
pipes to deliver cheap and reliable heat or cooling from a central
source – is well established there. Likewise, because of an
easily accessible supply of 15-18 degree Celsius groundwater
not far below the surface, the Netherlands offers excellent opportunities
for utilisation of heat pumps. The heat pump system
– which can also utilise heat energy from bedrock, earth, air or
lake water – provides an economical and efficient way to control
temperatures for both heating and cooling.
Simply put, a groundwater heat pump collects energy from
the groundwater. The water is pumped up from a groundwater
borehole to a heat exchanger, where the energy is recovered.
The water is then discharged back through another borehole.
Heat pumps don’t take up much space, need no maintenance
or fuel and offer an energy-efficient solution that saves money
– up to 50 percent of heating costs – compared with traditional
heating systems. In fact, the homeowners on groundwater systems
in the Netherlands pay only for heating. Cooling is essentially
free, as the 15-18 degrees Celsius groundwater can
be used for summer cooling: the only cost is for power to run a
circulation pump – a strong sales point for home builders.
Heat pump basics
A heat pump is a device that warms or cools a
building by transferring heat from a relatively
low-temperature reservoir to one at a higher temperature.
Heat pumps demonstrate great versatility in
providing both air conditioning and heating in the same
system by simply reversing the direction of flow of the
working fluid circulating through the coils. In this regard,
heat pumps eliminate the need for dual systems in order
to maintain a desired temperature. Heat pumps all have
the same basic components: a pump, a condenser, an
evaporator, and an expansion valve. The typical heat
pump operation uses the working fluid to receive heat
from a source positioned close to the evaporator. At the
evaporator, the fluid vapourises into a low pressure vapour.
Upon entering the pump, the vapour is compressed
to high pressure and enters a condenser which returns
the vapour to a liquid and ultimately gives off its stored
heat to the desired source. An expansion valve then allows
the system to return to its low pressure liquid state,
and the cycle begins again.
It is just this combination of efficiencies that Danfoss helped
supply to a newly built neighbourhood of 200 homes near The
Hague. These new houses were built in an area of older houses
from the 1950s, which receive district heat from Eneco, one of
three major power suppliers in the Netherlands. This project,
however, was sponsored by Nuon, a competitor of Eneco.
Because of the liberalisation of energy laws described earlier,
Nuon is able to buy gas and electricity from a competitor in
order to create a more economical and competitive micronetwork
solution. “Danfoss was a natural choice as a supplier
for a project like this,” says Ockhuizen. “We’re one of the few
companies able to offer a comprehensive range of products for
applications within district heating involving distributor stations,
commercial substations and single-family house substations as
well as heat exchangers and automatic controls. Danfoss was
the first company to combine district heating and heat pumps
into a single unified business unit, so we’re able to provide all
necessary components required for domestic heating, cooling
and hot water. Through our Comfort Division we can even sup-

ply products for the interior of homes, such as radiator thermostats
and floor heating.”
far-reacHIng benefIts
The micro-network concept provides numerous and farreaching
economic and environmental benefits. As a signatory
to the Kyoto Accord, an international treaty whereby
countries agree to reduce the amount of greenhouse gases,
the Netherlands has imposed regulations requiring that new
buildings meet certain environmental standards, which are
measured in terms of an energy performance coefficient
(EPC). “Micro-networks combining heat pumps and district
heating are an excellent way to meet EPC requirements, not
just because of heating and cooling efficiency of heat pumps,
but also because of electricity savings provided by district
heating,” says Ockhuizen. “Because district heating employs
waste energy in the form of heat from power plants, there
is a huge positive effect on both EPC and environment, so
district heating is becoming increasingly popular in the Neth-
engIne
electrIcIty
HEAT IN HEAT OUT
EVAPORATOR
compressor
2.compressIon
1.evaporatIon 3.conDensatIon
4.expansIon
expansIon valve
The Netherlands DANFOss wOrlD
CONDENSOR
erlands. Of the 50,000-60,000 new homes built annually, the
majority are served by district heating systems because of
the lower EPC rating.”
According to Ockhuizen, there is a rapidly growing demand for
such solutions in the Netherlands, and even large construction
companies and builders are developing micro-network
systems as a way to build market share. Supported by the liberalisation
of energy policies, this has created increased competition
within the energy market and has helped to control
and even reduce energy prices. Also, because district heating
systems can draw on a wide range of energy sources, including
wind, solar power and biomass, micro-networks fit in well
with the trend in the Netherlands toward small-scale simultaneous
production of heat and power. Therefore, there’s an
incentive for investment companies to put money into renewable
energy projects for use in micro-networks. The end result
is energy savings and reduction of CO 2 emissions: a clear
case of macro results from micro-networks.
agenda 23

sOlUtIONs EnergyTrim
24 agenda
Less is more – time to trim
Tony Nielsen, Scandinavian Sales Director for Danfoss EnergyTrim,
outlines the principle of the company’s service agreement that is yielding
a 15-25% savings return on a minimum investment for customers,
and highlights that efficient energy consumption requires knowledge,
commitment and action from all responsible parties.
TExT PAUL BARFOOT, PHOTO THOMAS OLESEN, HARTLY & MøLLER
mInImal Investment, maxImum savIngs
Danfoss EnergyTrim debuted on Danish shores just over one year
ago, and although only currently available to Danish customers,
its success has prompted plans to explore possibilities of how it
could be tailored to other markets in the future. Despite being in
its infancy, it belongs to a pedigree of expert knowledge within
the district heating sector, and has quickly set new standards in
energy efficiency for Danish municipals, housing associations and
small- to medium-sized companies.
The EnergyTrim package optimises existing heating systems
with on-going assessments, fine-tuning and proposals for
possible changes of defective or tired components that compromise
optimal energy efficiency. It comes with a promise to
slice customers’ energy bills by up to a quarter with a modest
investment that in some cases has been redeemed by savings
within as little as two months.
“Most installations are in good order, but they are not adjusted
correctly. synchronising a weather compensator in line with a labour
force or inhabitants can generate substantial savings, as can
adjusting balancing valves and pumps so that heat input is accurate.
An efficient cooling of the district heating water and the
stability of the temperature control is also very important. There
are many energy consultants within the district heating sector, but
the difference between them and what EnergyTrim delivers is financial
savings that can be felt almost immediately,” explains Tony
Nielsen, Scandinavian Sales Director for EnergyTrim.
long-term vIeW, contInuous effIcIency
“One-off servicing falls short in adapting to things like improved
insulation or a turnover of users. Such variables necessitate on-
going assessments and adjustments to ensure that optimum energy
efficiency is maintained. If we deliver a 25% energy saving
over three on-site visits and return a year later, it is almost guaranteed
that the customers’ energy consumption is back to where
they started because an inexperienced third party has made
changes to the system or a valve has become defective. It only
takes one defective valve for energy consumption to escalate,
and that’s why an on-going service agreement is important. One
thing is achieving immediate energy savings, another is to remain
responsive to changes in order to maintain it and make continual
improvements,” continues Nielsen.
real-tIme package, aDDItIonal benefIts
Understanding that some customers require an advanced level
of control and security for their installations, EnergyTrim Plus links
weather compensators to an energy-monitoring portal via web
access so that heat, water and electricity consumption can be
captured in real-time, and many assessments and adjustments
can be performed automatically and remotely. Furthermore, it allows
budget parameters to be set and warning alerts for overspends
to be generated.
unDerstanDIng energy beyonD comfort
Take-up of EnergyTrim has generally exceeded expectations, but
the biggest barrier is that it is a new concept that requires customers
to rethink efficiency.
“Customers trust the Danfoss brand and believe in the saving
promise, but it is a sector that is traditionally conservative. It is
very slow to adopt new ways of operating, and there is a tendency
to stick with what they know. In addition, many do not
understand efficiency beyond comfort. A system may provide a
comfortable level of heating and hot water, but it does not mean
it is the most economical or environmentally friendly. There is
a long way to go to turn people on to rethinking what energy
efficiency really means. We are now at a stage where we are
documenting how customers are making substantial all-round
savings, and this has been a powerful tool in switching people
on,” acknowledges Nielsen.

Sales representative Bjarne Kjærulff
and one of the cars
eco value
While the financial rewards of EnergyTrim are clear, customers
should not underestimate the environmental benefits of an energy
efficient system. It is an issue that is at the top of the global agenda,
and there is the hope that buy-in to services like EnergyTrim
is a benchmark that environmental responsibility is trickling down.
“Unfortunately not. We recently conducted around 25 interviews
with customers, and all of them revealed costsavings as their key
driver. Second to this was security. Most customers think that being
environmentally friendly and achieving an energy mark ‘A’ is a
valuable add-on, but it’s not a key driver yet,” reveals Nielsen.
retHInkIng tHe future, toDay
Alternative energy such as wind and solar power has a key role
within future energy systems, but EnergyTrim advances efficiency
immediately.
“Renewable energy is important, but targets set for 2020 are
20% in the EU and 30% in Denmark. That means 70–80% will
still be fossil fuels, and if we can trim the use, cost and negative
environmental impact of these by 25%, that’s a lot! It is important
to pick the low hanging fruits now. This is the message that we
are trying to get through with PR and continuous dialogue with
politicians and KOLs that have the power to translate it into policymaking.
Legislation and accountability are important, but they
are not enough,” asserts Nielsen.
EnergyTrim sOlUtIONs
District heating utilities are now required to save 1% annually
via their end consumer. This is a step in the right direction,
and many are now collaborating with Danfoss to promote
EnergyTrim to customers as a means to achieve it.
“I have been in discussion with the Ministry of Energy to advocate
mandatory service agreements for buildings over a certain
size. This would have a huge impact. They are of course only as
good as the level of expertise with which they are being administered,
and it is a very complicated process to benchmark and
police standards. But as a company we are committed to leading
by example, doing whatever we can to proactively maintain our
business as a political issue and share knowledge with customers
in the hope that we can continue to take the right steps forward,”
concludes Nielsen.
For further information, visit www.energytrim.dk
eNergytrIm hOt FACt: 130,000 DKK saved in five
months! In less than half a year, Lind Furniture in Thorning
trimmed its gas consumption by 16, 300 cubic metres
and achieved a financial saving of 130,000 DKK with
EnergyTrim. Renovating the company’s heat control system and
continuous optimal adjustments cost Lind Furniture 50,000 DKK,
which was returned two and a half times over in just five months.
“Savings have become a sport for us all,” announced the company’s
Building Manager Lars Maretti.
agenda 25

ACADemy Trends
A proven solution with
big potential
26 agenda
“District energy is one of the best-kept secrets in the energy
world,” says Preben Tolstrup, CEO of LOGSTOR. Together with
corporate leaders from Danfoss, Grundfos and the consulting
company COWI he’s working to change this situation.
TExT ROB HOLDER, PHOTOS MIKKEL STRANGE
It’s been around for decades. It not only works, it works remarkably
well. It’s been one of the driving forces behind Denmark’s enviable energy
efficiency record. So why isn’t district energy one of the leading
options on the EU – and worldwide – energy agenda? A conversation
with Preben Tolstrup makes it clear that the answer may be that, in
an era enchanted by the idea of breakthrough technologies, district
energy is either not being fully understood by many European politicians,
or is simply not “sexy” enough.
Which is why the leaders of four prominent Danish corporations became
especially concerned when first drafts of new EU energy directives
made no mention of district energy. So concerned that they
collaborated on a white paper* clarifying district energy’s practical advantages
and environmental promise. “We had to take the initiative,”
says Tolstrup, “not only with the white paper, but also through direct
contact with officials in Brussels and industry groups, such as the European
Business Forum.”
loWerIng consumptIon
One of the main points of the white paper is that the “easiest” way
of reducing CO 2 emissions is simply to lower energy consumption
by becoming more energy efficient. A point that becomes even
more powerful in light of the fact that more than one third of the
energy supplied to the EU-32 countries in 2003 was lost and never

Glass jars with different
coloured contents offer
a graphic representation
of the many ways district
energy can preserve and
combine energy.
Trends ACADemy

ACADemy Trends
28 agenda
delivered to energy end users. This waste of energy alone
makes it important to recall that the fundamental idea of
district energy is to make use of local fuel, heat or cooling
sources which would often otherwise be wasted. District energy
makes much greater efficiency possible by using a local
distribution network of insulated pipes, which provide for a
cheap and reliable heat or cooling source.
It’s also important to remember that district energy systems
are essentially common carriers for a wide range of energy
sources. District energy is a multifuel system: any type of
available energy, whether “black” or “green” can be used –
from coal, oil and gas to wind, solar power and biomass – or
stored for future use.
“Even materials such as industrial or household waste products
are increasingly being utilised as fuel for district energy,
which also helps resolve other environmental problems, like
waste dumping,” says Tolstrup. “It’s not at all far-fetched to
envision a future in which many stand-alone systems, including
wind and geothermal systems, will be parts of a tightly
linked district energy network – what I’d call an intelligent
energy system – where each energy source will help balance
and optimise both energy supply and energy efficiency.”
reDucIng emIssIons
Most importantly, district energy has been thoroughly proven
through years of experience in many countries. In Sweden,
Denmark and Finland, for example, more than 50% of the
population use district energy today. District heating has already
made a start at helping to reduce CO 2 emissions. At

the end of the 1990s the International Energy Agency estimated
that district heating was reducing global CO 2 emissions
by 3-4% (700-900 million tonnes). A doubling of the
current 6% district heating share of the EU-32 countries to
12% would result in an estimated reduction of 400 million
tonnes of CO 2 – the equivalent of the entire emissions from
fuel combustion in France. It would also significantly lower
import dependency and dramatically increase energy efficiency.
District cooling, for instance, is 5-10 times more efficient
than traditional cooling solutions, such as electrically
powered air-conditioning (AC) systems.
Preben Tolstrup acknowledges that CO 2 reduction and increased
energy efficiency are complex issues. “As both oil
prices and energy demand continue to rise and environmental
concerns multiply there’ll be increased pressure for
change,” he says. “It seems obvious that district energy can
play an important part. Politicians have to take the lead – for
example, through redesigned tax laws that move the focus
from simply generating revenues to providing energy incentives.
But we all need to do a better job of “branding” district
energy, of getting the message out that it’s one of the best,
most readily available solutions we have to a whole range of
energy and environmental problems. I’m an optimist – I believe
that doubling our use of district energy within the next
10 years is absolutely doable.”
*To read the “White Paper on District Heating and
District Cooling Solutions in an Environmental Perspective”
go to www.dh.danfoss.com/agenda
District Energy involves
production of steam, hot water or chilled
water, or any combination including all three, at a
single central utility plant for distribution to other
buildings through a network of pipes. District
energy systems are essentially common carriers
for a wide range of energy sources. Any type of
available energy – from coal, oil and gas to wind,
solar power and biomass – can be used for heating
and cooling buildings or stored for future use.
In a cogeneration plant the core element is that
both electricity and heat/cooling is generated in a
combined process, bringing the energy efficiency
to more than 90%, from around 40% producing
electricity on a stand-alone basis.
The combination of cogeneration and district
energy is very energy efficient. A steam-electric
power plant which generates only electricity
can convert only up to 47% of the fuel input into
electricity. The major part of the energy is wasted in
form of heat and dissipated to the environment. A
cogeneration plant recovers that heat and thus has
a degree of efficiency of around 90%.
Trends ACADemy
agenda 29

gADgets Smart Ideas
eNergy-saviNg power cutter
standby functions use up to 70% of the power required of TVs, dVd players,
games consoles, home theatres and hi-fis that are switched on. Put an end
to unnecessary standby energy guzzling with a Power safer. you never need
to unplug your TV again as it disconnects the standby mode from the power
supply via your remote control. simply plug and go, and the Power safer will
reduce your energy bill and extend the life of your equipment by up to 15%.
www.doctorenergy.co.uk
glowiNg Nights
Light up your evenings with this long-life, energy-smart
night light. The light-emitting diode has a durability of
50,000 virtually heat-free hours that will illuminate your
dark hours. savings from its very modest 2W power
consumption will also be felt in your pocket. Plug it
in and enjoy a warm, radiant, dazzle-free light come
dusk. At dawn the light switches off automatically.
www.conrad.se
30 agenda
a Bright charge
using Mother nature to charge us up is a resourceful concept. The
freeloader solar charging system uses sun rays to fuel all your gadgets
and gizmos. fully charged, the internal battery can provide 18 hours of
playtime for an iPod, 2.5 hours of gaming for a PsP and 44 hours
of talktime for a mobile phone. With a capacity to hold its
charge for up to three months, impact-resistance and
sleek aesthetics – it’s an energising must-have.
www.solartechnology.co.uk
log oN to a c02-frieNdly future
initiatives to fight global warming have created a growing number of tools to
help manage and reduce c02 pollution. The danish Ministry of the environment
and Ministry of Transport and energy have launched an online portal as
part of the ‘1 ton mindre’ (1 tonne less) campaign. Visit www.1tonmindre.dk to
measure and limit your toxic emissions with a c02 calculator. similarly, the german
website www.co2online.de is dedicated to motivating private households,
trade and commerce to be proactive in climate protection, with practical advice
on reducing energy costs. The first step to a greener future is at your fingertips.

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