Governing the heat transition
Authors:   , Herreras Martinez Sara Dolores 
Published: October 2024

The climate crisis, with rising sea levels and extreme heatwaves, underscores the urgent need to reduce energy demand and transition to sustainable energy. Heating, responsible for nearly half of global energy consumption, plays a central role in this transition. Moving from fossil fuels to low-carbon heating alternatives in buildings—through electrification, energy efficiency, and renewable solutions like district heating and biogas—can significantly cut CO2 emissions, improve energy security, and build more resilient communities. However, while heating is critical in reaching climate goals, many countries have only recently begun adopting supportive policies, leaving gaps in how nations, largely reliant on fossil fuels, are addressing this shift.

Using both qualitative and quantitative methods, this thesis examines the technical, economic, regulatory, and organizational challenges and opportunities faced by local governments and citizen-led Thermal Energy Communities (TECs) in advancing the heat transition in buildings. The Dutch context, undergoing a recent shift away from natural gas, provided this thesis with a valuable case study. Here, the central government has designated municipalities as key players in local heat strategies and acknowledges the vital role of citizen energy communities in advancing the heat transition.

The research highlights that local governments face significant challenges in crafting effective local heat strategies. Limited central government support in terms of regulation and financing are two key missing ingredients, namely the lack of binding regulations and affordable alternatives to drive the switch to sustainable heating. Additionally, a shortage of internal municipal capacity - a very prominent challenge for small and medium municipalities - make these efforts particularly challenging. Last, technical uncertainties are also present. While current techno-economic models are valuable for identifying the optimal heating solution for each neighborhood, the thesis reveals uncertainties in determining the best system. Additionally, these models are often too complex for municipalities to manage on their own, leading them to rely heavily on costly external consultants.

Further, the research explores the pros and cons of transitioning to public ownership for district heating systems, which could promote transparency and affordability. However, a one-size-fits-all approach to public ownership may limit the adaptability needed to meet local needs effectively. This thesis suggests that implementing regulations protecting public values and enabling the coexistence of public, private or public-private configurations tailored to each unique local context could be an alternative, as successful district heating sectors abroad demonstrate.

Finally the thesis highlights that TECs are essential players in the heat transition. By examining the Netherlands alongside Denmark and Germany, the thesis illustrates how policy support and economic incentives have fueled TEC growth, especially in promoting renewable heating solutions and engaging communities. However, scaling TECs remains a challenge in both the Netherlands and Germany, underscoring the need for improved institutional frameworks to help these initiatives expand and thrive.

In conclusion, this thesis offers a comprehensive analysis of the heat transition, identifying key barriers and proposing actionable solutions for local governments, policymakers, scientists, and TECs. Its findings contribute valuable insights to the ongoing efforts to decarbonize heating in buildings and bolster climate resilience.