A High Energy Potential: Power-to-Heat

Though a lesser discussed power-to-x solution, power-to-heat technologies are already mature, commercially available, and market competitive. And they are already making an impact on the power sector.

Much discussion over the past year has been centered on power-to-gas (PTG), and particularly, on power-to-hydrogen, or power-to-methane. While these technologies’ potential to make a major dent in power transitions remain laudable, their widespread uptake isn’t projected for a decade or more.

A specific “power-to-x” prospect that industry observers point to that could yield more immediate decarbonization benefits is “power-to-heat.” Often embedded within a larger conversation about electrification of buildings and space heating, power-to-heat (sometimes abbreviated as P2H or PTH) simply defines a process whereby generated power is used for heating and cooling applications, typically through heat pumps or boilers. The emphasis on P2H of late, however, typically also integrates the use of renewable power, smart load management, and thermal storage systems, and the term is being increasingly used to describe a flexible coupling of power and heat sectors.

The reason for this, as the International Energy Agency (IEA) explains, is that heat accounted for half of global final energy consumption in 2019, but only 10% was produced using “modern renewable energy” (which excludes traditional uses of biomass). According to the International Renewable Energy Agency (IRENA), in the U.S., more than 60% of annual heating and cooling requirements were met by fossil fuel-based sources, such as natural gas, propane, and fuel oil in 2018, and in Europe, about 75% of annual heating and cooling requirements were met by fossil fuels in 2019, while only 19% was generated from renewable energy. While some heating and virtually all cooling is electric, renewable P2H refers to the use of renewable power to generate economically justifiable demand for heating or cooling for buildings or industrial processes.

This, it notes, is typically accomplished with electric boilers, which use power to heat water, which is then circulated through pipes or disseminated with fan coils to provide space heating, or stored in hot water tanks for later use. Heat pumps, on the other hand, rely on a 160-year-old concept that uses electricity “to transfer heat from the surrounding heat sources (air, water, ground) to buildings.”

The Allure of Heat Pumps

Because heat pumps can fulfill both heating and cooling requirements—typically, by using about 66% to 80% of energy in the ambient air, water, or ground, and a smaller 20% to 33% from electricity to drive the process—they are widely seen as playing a critical role in the electrification of buildings and industry sectors. The European Technology and Innovation Platform on Renewable Heating and Cooling (RHC), for example, envisions 100% renewable–based heating and cooling is possible on the continent by 2050 if a strong integration with the power sector is established using heat pumps and thermal energy storage, along with the wide uptake of smart energy systems.

According to the IEA, increased uptake of heat pumps is already underway. In 2019, nearly 20 million households purchased heat pumps, up from 14 million in 2010, though most of this growth was from higher sales of reversible units that can also provide air conditioning, which reflects rising cooling demand. In Europe, heat pump sales increased 25% over the past two years, with high numbers of air-source heat pumps sold but steeper growth in heat pump water heaters. Market research firms are also notably bullish on an expanding heat pump market. Allied Market Research, for example, predicts the global heat pump market size, which was valued at $55.2 billion in 2018, will nearly double to $99.6 billion by 2026.

The allure of heat pumps as a critical P2H component lies in its high efficiencies, notes the RHC. “One unit of electricity can provide between three and five units of heat (in very specific designs even six to seven units are possible). At the same time, such a system provides an additional two to four units of cooling, making overall [heating and cooling] efficiencies of between five to eight possible,” it explains. “In more practical terms, exchanging a fossil boiler with a HP [heat pump] saves about 50% of primary energy, while exchanging a direct electric heating system with a HP frees 2/3 to 3/4 of final/primary energy used.”

Despite their obvious energy efficiency benefits, meanwhile, the IEA suggests wider uptake of heat pumps could necessitate a massive ramp up of power generation, adding a new burden to some already heaving, aging grids around the world. “For example, if heating in all buildings in Europe was switched to electricity using heat pumps, peak winter electricity demand would increase by more than 60%,” it projected under its highly optimistic 2018 “Future is Electric” scenario.

Power-to-Heat Already Reshaping the Power Sector

1. Types of heating systems that use electricity. Courtesy: International Renewable Energy Agency, 2018

Still, as so many case studies of late have shown, P2H is starting to show tangible benefits for energy transition strategies. IRENA notes this is happening on two broad scales (Figure 1). One is through centralized heating systems, such as “district heating or cooling networks,” where large-scale electric boilers and heat pumps are supplied with power directly from the main grid, or via combined heat and power plants. The other case is in decentralized heating systems, such as in industry, which use small-scale heat pumps or electric boilers for heating or cooling that are powered by the grid, or directly, such as with rooftop solar, behind-the-meter batteries, and other storage system.

Moderating Renewable Energy Curtailment. As renewables ramp up boosted by incentives and market value, P2H is starting to provide a new mechanism to utilize surplus power to address heating needs. European countries provide myriad cases. Swedish utility Vattenfall, for example, in November 2018 began operating an electric boiler in Hamburg that uses excess wind power to generate heat during peak-load periods (Figure 2). In September 2019, the company also connected a 120-MW P2H facility to the district heating grid at its Reuter West power plant in Berlin. The company said the three electrode boilers at the plant, each with a capacity of 22,000 liters, heat water to 130C using electricity, and have allowed it to retire a coal unit at the site.

Meanwhile, as part of the Heat Smart Orkney project funded by the Scottish government, a planned wind P2H project will provide households with energy-efficient heating devices that will draw excess power generated from the community-owned wind turbine. China, which has grappled with solar and wind surpluses, also has interesting projects. The Inner Mongolia Autonomous Region, which had installed about 22.3 GW of wind power at the end of 2014, will this year start operating a project to use surpluses in electric boilers with a total 50 MWth capacity to provide heat for a district heating system.

Introducing Flexibility for Load Shifting. A handful of projects have also been implemented to provide demand-side flexibility using heat pumps. The EcoGrid EU project, led by a consortium of energy and technology companies from Nordic countries, for example, in June 2019 ended a three-year demonstration of an innovative smart grid system that integrated 28,000 customers on Bornholm Island, Denmark. The project showed time-of-use tariffs and real-time price signals are useful in activating flexible consumption, and that P2H may offer a significant potential for peak load shaving.

Swedish firm EctoGrid, meanwhile, has developed a technology to connect the thermal flows of multiple buildings that use heat pumps and cooling machines to supply or withdraw heat energy from the grid. The system uses a cloud-based management system and promises to reduce energy demand for heating systems by 78%.

Providing Large-Scale Energy Storage. The RHC notes that if coupled with thermal energy storage, PTG’s capability to correct mismatches between heat supply and demand could be enhanced. That could allow for optimal usage of a combination of different renewable sources over a day, or even a year, it says. It suggests several “state-of-the-art” technologies could fulfill that potential, including sensible heat storage (SHS) technologies, latent heat storage (LHS) technologies, thermo-chemical heat storage (TCS), and underground thermal energy storage (UTES).

One interesting example is Drakes Landing, a technical demonstration that uses solar thermal energy and seasonal UTES for a district heating scheme. The project supplies a residential community of 52 houses in Alberta, Canada, which capture solar energy during the summer and store it underground using borehole thermal storage. During winter, heat is extracted from the stores and distributed to each home. German power company RWE, meanwhile, is exploring building a heat storage power plant at a coal plant in the Rhenish lignite mining region, where surplus wind power will be used to heat liquid salt to as much as 560C.

Virtual Heat and Power. A number of technology providers today also already offer a variety of “smart storage heating” solutions, which allow electrical heating to respond to network conditions by storing energy during plentiful supply. “These smart storage heaters can be remotely controlled by aggregators to both [optimize] heating costs for consumers and provide grid-balancing services to the national grid,” IRENA suggests. In the UK, for example, energy provider OVO Energy and energy solutions provider VCharge have developed a solution to aggregate smart heating systems used in nearly 1.5 million homes in the country. The aggregation represents a combined peak capacity of 12 GW. In Switzerland, meanwhile, Tiko solutions has connected more than 10,000 electric heat pumps and hot water boilers. Those components are continuously monitored, and their electricity consumption is controlled to provide flexibility services to the national grid.

Distributed Power-to-Heat. In regions that have no net energy metering or net billing, self-production and consumption of heat produced by surplus power, from rooftop solar installations for example, is starting to gain traction, says IRENA. “Further, during hours of peak solar generation, the distribution system operator may not be able to absorb all generation from distributed sources. In such cases, heat pumps help maximise self-consumption by converting the locally generated electricity to heat or space cooling,” it adds. One related example comes from U.S.-based Kraft Foods, which uses heat pumps at its plant in Iowa to upgrade 2.1 MW of waste heat from its refrigeration system to heat water. SolarChill, a partnership between European technical organizations and a number of international development organizations, is meanwhile working on a project to install solar energy–powered refrigerators for medical uses in regions with unreliable power supplies.

IRENA suggests that more examples like these will be introduced as renewable power costs fall further, and the efficiencies of P2H improve. However, it also advocates for a “significant push” from policymakers for these technologies by urging them to consider limiting the use of fossil fuel boilers, and to introduce requirements for new buildings to include renewable energy sources. ■

—Sonal Patel is a POWER senior associate editor.