A Key to Urban Comfort and Efficiency

Japan's District Heating and Cooling Systems

JFS Newsletter No.82 (June 2009)

Introduction

Most Japanese use air conditioners to live indoors comfortably throughout the year. Some cities have
district-wide heating and cooling systems, which distribute cold water, hot water, and steam produced
at one or more heat generation plants, to buildings in a limited area to be used for cooling, heating,
and hot-water supply. This month's newsletter introduces the current state of Japan's district heating
and cooling systems.

Shinjuku is a major shopping, entertainment and business district within Tokyo, and the home of many
tall skyscrapers, including two office towers of the Tokyo Metropolitan Government. This business
district is where one of Japan's district-wide heating and cooling systems is in operation. Cold water
and steam generated with natural gas at the Shinjuku District Heating and Cooling Center are supplied
to buildings in the system's service area for use by air conditioners. This center has freezing capacity
of 207,680kW and heat capacity of 173,139kW in the total service floor area of 2,200,000 square
meters, which is the largest capacity in Japan and is one of the largest in the world.

A district heating and cooling system requires an extensive plumbing network, but it also has a number
of advantages compared to heating and cooling systems installed in individual buildings. District
heating has economies of scale due to its large size and centralized control system, making it possible
to employ highly efficient thermal sources and even untapped low-temperature thermal sources. Thus,
this type of system can contribute not only to energy conservation but also to reduction in public
nuisances, such as air and noise pollution and unpleasant vibrations, due to more effective facility
management. In addition, safety concerns can be mitigated, since buildings do not need to be
equipped with potentially dangerous facilities or materials, such as their own air-conditioning plants or
fuel supply. As well, the space that would otherwise be used for air-conditioning equipment in buildings
can be used for other purposes. Chimneys and cooling towers are not necessary, either, so the
aesthetic aspects of buildings and cityscapes are improved.

According to a survey on energy conservation by Japan's Ministry of Economy, Trade and Industry,
district heating is more efficient than individual systems installed in individual buildings, in terms of
energy conservation, by 12 percent when a general district heating method is employed, 15 percent
when a cogeneration system using exhaust heat is employed, and 22 percent when otherwise
untapped energy is used. As a whole, an average energy saving of about 15 percent can be realized
by using a district heating system.

History of Japan's District Heating and Cooling Systems

The first district heating and cooling system in Japan was introduced at the site of Osaka EXPO in
1970. In those days, environmental pollution was becoming a serious issue as it grew with Japan's
rapidly growing economy, and thus, the regulation of air pollution, in particular, was becoming more
stringent. Many local governments were accelerating the adoption of district heating and cooling
systems as an effective measure to mitigate air pollution, and this approach was rapidly introduced,
particularly in metropolitan areas such as Tokyo.

Against this backdrop, district heating and cooling systems became subject to government control
under the Heat Supply Business Act, established in 1972, under which a heat supply facility with a
capacity of 21 gigajoules (GJ) or more per hour was regarded as a public utility. (The thermal capacity
of 21 gigajoules corresponds to the capacity needed to operate 2,500 air conditioners for general
household use, or to air-condition an area of 50,000 square meters of office floor space.) A heat
supplier operating such a facility must obtain a license from the Minister of Economy, Trade and
Industry, obtain approval for rates and other supply conditions, and always satisfy the needs for
heating and cooling in its service area. These requirements are defined by the Act to secure the
protection and safety of consumers.

During a period of three years from fiscal year 1972, 16 heat supply operators obtained new licenses,
bringing to 21 the total number of service districts that had begun operations. In various areas
throughout Japan, new heat supply projects were planned, but the heavy impact of the steep rise in oil
prices caused by two oil crises from the end of 1973 forced the growth of the heating and cooling
business to be scaled back. The number of newly licensed heat supply operators and the service
districts starting operations was 4 and 11, respectively, for the six-year period from FY1975 to
FY1980.

Due to a fall in raw material and fuel prices because of a decline in oil prices, plus appreciation of the
yen after the oil crises, the management of heat supply operators gradually became more stable, and
a new development phase began in 1981 with an increase in the number of newly licensed operators.
From around 1986, in particular, district heating and cooling systems were introduced in various areas,
mainly in Tokyo, as urban redevelopment progressed.

In FY1986, there were 32 heat suppliers operating in 42 service districts, and their sales totaled 37.2
billion yen (about U.S.$380 million), while in FY2002, the number of operators reached 90, the number
of service districts grew to 147, and total heat sales reached 151.4 billion yen (about U.S.$1.55 billion),
but these figures have hardly grown since then. According to the Japan Heat Service Utilities
Association, it is largely because large-scale urban development has been on the decline.

The Japan Heat Service Utilities Association

http://www.jdhc.or.jp/en/

At the end of FY2007, the numbers of heat supply operators and service districts were 86 and 148,
respectively. There were 12 service districts in Hokkaido; 89 in the Tohoku and Kanto regions; 12 in
the Chubu region; 27 in the Kinki, Chugoku, and Shikoku regions; and eight in the Kyushu region. The
total service district area was 44,248,000 square meters and the total service floor area in buildings
was 48,674,000 square meters. The quantity of heat sales was 25,071,818 GJ and total sales were
153,148 million yen (about U.S.$1.56 billion).
By FY2007, the technology used by heat supply facilities had dramatically improved. The equipment,
including chillers, had an increased capacity, employed higher-efficiency technology, and the use of
cogeneration systems, in which heat is created simultaneously with electricity generation, became
widespread. Also, heat pump systems, which recover heat from urban exhaust heat and untapped
low-temperature heat reservoirs, such as river water and air, were adopted. The types of urban
exhaust heat used include heat from waste incineration, wastewater heat, and waste heat from
subways, among other sources.
(Reference: Heat Supply Business Guide, FY2008 edition, published by the Japan Heat Service
Utilities Association.)

Recent Developments

As an example of the latest type of district heating and cooling system in operation, we took a look at
the state-of-the-art technology at the Makuhari District Heating & Cooling Center, operated by Energy
Advance Co. This center supplies cold water at a temperature of 6.5 degrees Celsius and steam at a
temperature of 170 degrees Celsius for air conditioning for the international business area in Makuhari
New City (located in Chiba City, Chiba Prefecture) with an area of 61.6 hectares. Nine facilities in the
area, including Makuhari Messe, an international convention complex, hotels, and office buildings, are
currently supplied with cold water and steam. In total, a floor area of 660,000 square meters is covered
by the center's service.

Makuhari District Heating & Cooling Center

Copyright Energy Advance Co.

It has employed a steam boiler, a steam absorption chiller, plus a steam turbine-driven turbo chiller
system that uses the burning of natural gas as a heat source since 1989. In March 2007, a high-
efficiency gas-engine cogeneration system was added by introducing two gas-engine generator
systems produced by the Wartsila Corporation in Finland. The electricity generated by these two
systems -- a 20-cylinder V-configuration engine, the 20V34SG, with an electric generating capacity of
8,730 kilowatts, and a 16-cylinder V-configuration engine, the 16V34SG, with an electric generating
capacity of 6,970 kilowatts -- is mainly used for the electric turbo chillers to produce cold water.
Furthermore, water warmed when the engines are cooled is used as a heat source for the hot water
absorption chillers.

The heat of hot exhaust air from the engine systems is recovered in the form of steam by the exhaust
heat recovery boilers. Together with steam from other boilers, the steam from the engine systems is
supplied directly to heating and cooling systems and used to power chillers. These new gas-engine
generator systems make it possible to respond to fluctuations in heat demand by the optimal
combination of different systems.

The power generation efficiency (lower heating value standard, or LHV standard) of these gas-engine
systems is about 45 percent, which is beyond the demand-end efficiency of general thermal power
plants. The system's total efficiency, which is the efficiency of hot water plus that of exhaust heat
recovery combined, is about 77 percent. The target for total energy efficiency (coefficient of
performance, or COP) is set at 1.2, up from the current level of 0.7. (A COP of 0.7 means that output
energy is 0.7 when input energy is 1.) Meanwhile, the system has already achieved a 24-percent
reduction in fuel consumption and a 24,000-ton reduction of annual carbon dioxide emissions.

One feature of the modifications in 2007 is that when more electricity is generated than the amount
needed for the district's own use, the surplus electricity can be sold to external entities. This became
possible due to the change brought by deregulation aimed at electricity liberalization after the year
2000. As a result, power can be generated at a maximum output level without being constrained by
the actual amount of use, and exhaust heat from power generation can be optimized, so that total
efficiency can be improved.

A visit to the Makuhari District Heating & Cooling Center gave the author a much better understanding
of the potential future of district heating and cooling systems; the systems will likely grow out of
conventional ones that supply only heat and be geared toward "district energy centers" that achieve
significant energy saving by supplying both heat and electricity. The company Energy Advance
regards the Makuhari District Heating & Cooling Center as a model case for a "district energy center,"
and is aiming to introduce the same kind of system developed there in other districts after evaluating
its performance.

Makuhari District Heating & Cooling Center

http://www.energy-advance.co.jp/area/makuhari_district.html (in Japanese)

System flow of the center

http://www.energy-advance.co.jp/area/makuhari_virtual.html

Future Outlook

These days, something called a "microgrid" system has started to attract attention in Japan. This is a
system where various types of distributed power sources are linked together by a network in a region,
and power generation and transmission within the region are controlled optimally. Distributed power
sources include solar, wind, biomass, and power generated by cogeneration systems. As natural
energy sources are not constant producers for use as power sources, and regional power demand
fluctuates, it is essential to utilize information technology to control the entire network and secure a
stable energy supply. An advanced district heating and cooling center will likely be a key facility in any
microgrid system.

Toward the creation of a working microgrid system, Tokyo Gas, a parent company of Energy Advance,
is carrying out a study on something called a holonic energy system. The word "holonic" refers to
"organic harmony between individuals and the whole." In October 2006, the company built a holonic
energy system (utilizing a gas engine, solar power, wind power, and a battery) in its Yokohama
Research Institute and is conducting demonstration tests.
http://www.tokyo-gas.co.jp/env/challenge/category01.html (Japanese only)
http://www.tokyo-gas.co.jp/Press/20080331-01.html (Japanese only)

Holonic energy systems are now attracting much attention for their potential in district heating and
cooling centers and the greater use of renewable energy.

Written by Kiyoshi Koshiba