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Analysis & Projections

U.S. District Energy Services Market Characterization

Release Date: February 14, 2018

In a district energy system, a central plant or plants produce steam, hot water, or chilled water, which is then pumped through a network of insulated pipes to provide space heating, cooling, and/or hot water for nearby connected customer buildings. The U.S. Energy Information Administration (EIA) contracted this report from ICF L.L.C. to inform modeling and analysis of domestic district energy systems.

District energy allows customers to save space and expenses by avoiding individual installation, operation, and maintenance of in-building heating, cooling, and water-heating equipment. Using economies of scale, district energy systems often distribute heat generated by combined heat and power (CHP) systems to use thermal energy that is produced more efficiently. District energy systems are more commonly found in commercial clusters of buildings such as colleges, hospitals, downtowns, healthcare, and government campuses.

ICF worked with the International District Energy Association’s (IDEA) database of 660 existing district energy systems operating in the United States. In 2012, an estimated 5.5 billion square feet of heating floorspace and 1.9 billion square feet of cooling floorspace were serviced by district energy. District energy characteristics are provided by Census division (Table 1) and by fuel type (Table 2).

Table 1. Share of U.S. district energy by Census division
Census division Heating gross square
footage served
Cooling gross square
footage served
New England 350,911,392 95,141,891
Middle Atlantic 1,497,478,221 200,603,217
East North Central 991,553,018 395,790,579
West North Central 570,177,893 158,611,465
South Atlantic 813,768,087 288,977,364
East South Central 158,622,454 94,156,827
West South Central 359,938,693 316,360,508
Mountain 188,521,265 117,605,771
Pacific 520,343,083 210,321,556
Total 5,451,314,105 1,877,569,178
* Note that heating and cooling gross square footage overlap for many systems, so the regional amounts are not additive.
Table 2. Share of U.S. district energy fuel use by fuel type
Fuel Non-CHP heating (MMBtu) Non-CHP cooling (MMBtu) CHP (MMBtu) Total (MMBtu) Percent of total fuel use
Coal 58,998,023 0 97,000,378 155,998,401 16%
Electricity 0 14,238,482 0 14,238,482 1%
Natural gas 372,251,735 6,049,694 342,242,633 720,544,063 74%
Oil 11,160,227 13,135 13,980,363 25,153,725 3%
19,729,303 0 42,209,336 61,938,639 6%
Total 462,139,288 20,301,311 495,432,710 977,873,309 100%

When referencing the contract report, it should be cited as a report by ICF International, L.L.C. prepared for the U.S. Energy Information Administration.


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