# Opportunities for Machine Learning in District Heating
## 2 District Heating Networks  
DH as a technology is designed to operate for decades, although the environment in which those systems operate often evolves faster than expected with changes in population. All major DH systems in Europe were built in the period of 1950-1980, and designed for a 20-30 year economic lifetime, although today many of these remain in operation. With continued urbanisation accelerating the urban sprawl, these networks need to be adapted to meet additional and growing demands. This primarily concerns higher expected standards of service, generally achieved through improved monitoring, planning (lowered need for overcapacity) and other forms of optimisation. The process of delivering heat involves several sub-processes that together constitute the DH value chain:  
1. Supply (production) of heat from, e.g., Combined Heat and Power (CHP) plants, boilers or recovery of surplus heat;
2. Distribution of heat;
3. Transfer of heat to customer (substation, mostly owned by customer);
4. Consumption of heat at residential homes, offices, public buildings and industries/firms. For each of the processes in the value chain, the heating networks need to adapt to overcome several challenges, originating from a number of trends, such as:  
A shift from monopolies to a competitive market. DH has been monopolised (similar to power and water distribution) in most countries but is gradually deregulated and exposed to competition. The transition toward a competitive DH market is well underway and will only become more serious in the future. DH, as a technology, is desired by the EU, but the question is whether DH companies will be able to prevail and flourish in the rapid shift towards electrification that will intensify competition, e.g., with heat pumps. Such a competitive market will result in vertical and horizontal competition between different actors at different levels of the value chain. A shift from a local, centralised to distributed heat supply. A transition from monopolies to competitive markets will also result in more decentralised DH networks. Large central plants will gradually be replaced by decentralised heat sources involving multiple actors. To meet the increasing demand created by the urban sprawl, distributed supply networks will be a better alternative compared to centralised supply. Cross-sector city collaboration, between city planning, construction and the infrastructure utilities (heating, cooling, water, sewage water, fibre optic and electric power), will need to be improved to share investment costs, thus adding new actors and further decentralisation of DH systems. Such distributed and decentralised supply networks will create new opportunities for incentives as a result of competition. A shift from infrastructure centric to a process and service centric industry. A decentralised and competitive DH network will empower customers by offering them the possibility to select their heat provider. As such, the DH network will have to shift focus from infrastructure centric to a processes and service centric industry. The traditional front-end of DH has been the border of the customer property, which means that the substation is owned by the customer. From efficiency and operation points of view, this division of ownership has caused excessive pumping of hot water (and more heat losses), due to poor performance of the substations and the secondary heat system of the customers. In traditional DH operations, the inefficiency cost has partially been neglected. In the adoption of 4 GDH, with lower temperatures, this inefficiency is intolerable. In parallel, the DH companies must come closer to their customers and offer them new services (generating new revenues and reducing costs). The challenge of Capital Expenditures (CAPEX) is often neglected in the extremely infrastructure intensive DH industry [20] and by the academic community. Large production plants are expensive but will gradually be phased out when the 4 GDH and 5 GDH are phased in.