District Heating Business Models and Policy Solutions: Financing Utilization of Low-Grade Industrial Excess Heat in the People’s Republic of China

The People’s Republic of China (PRC) has taken bold actions to utilize low-grade industrial excess heat improve energy efficiency districting heating systems since 2016. This study aims draw policy insights into the PRC’s field experience with overcoming barriers financing. First, we investigate split incentives, third-party access, and lack resource mapping as key investing in district projects. Second, enable financing market, analyze three business models: a utility-led model production competition model, an service company integrated model. decision making choosing these options large part depends on integration level production, transmission, distribution activities given system. Third, prices must signal new investments capacity adequacy. We suggest four pricing system cost, free-cost, quantity target for clean heating, indexing against next best alternative. Finally, conclude implications scale up heating. Although analysis is specific PRC, issues are global opportunities improving systems.