Coupling of the electricity and district heat generation sectors with building stock energy retrofits as a measure to reduce carbon emissions

This study examined how the carbon dioxide emissions can be reduced in an energy system with coupling of the electricity and district heat generations, while considering different paths for the building stock development. As the building sector and the energy sector are interdependent on one another, it is important to consider them as a whole, to understand to what extent emission mitigation measures should be conducted in each of them, to avoid unnecessary costs. The problem was applied to a Finnish context and formed as a mixed-integer linear programming problem, which was used to minimize the emissions from highly renewable electricity and district heat generations, by using the flexible properties in both. A scenario-based analysis was performed, where simulations were conducted for the year 2050 and the effects to the emissions and energy system costs were examined over 30 years up to 2050. The set target of 90 % emission reductions in annual emissions, from the 2020 level, was attained with several combinations of wind power, deep heat well heat pumps, and thermal storage as part of the energy generation, for each of the energy retrofit scenarios of the building stock. However, both the building stock and energy system measures were required to reach the target. The amount of wind power had a major impact on the results, and in general the more wind power was utilized the less the other measures were required. Moreover, when the building stock was retrofitted to a lower environmental impact level, the costs to reach the target emissions were less than half compared to retrofitting them to a higher impact level. However, there was no major difference whether the building stock developed more towards household heat pumps or district heating. The least costly set of options to reach the target emissions for 2050, 1.83 Mt of carbon dioxide annually, attained them with a cost increase of 10.18 billion euros from the reference over 30 years. The emissions for the same period decreased by 56 %, from 488 to 217 Mt of carbon dioxide, resulting in a unit cost of 37.6 € per ton of carbon dioxide for the emission reductions.