Model of medium-sized district heating development strategy based on new environmental legislation

This paper is assessing current situation of district heating sector in the Czech Republic facing impacts of European environmental legislation instruments - namely EU ETS directive (CO2 price), industrial emissions directive and medium combustion plants directive and Czech legislation - namely pollution fees, VAT change and energy taxation. In this respect, medium-sized district heating utilities are in disadvantageous position compared to heat installations below 20 MW rated thermal input, which are not subject to majority of legislation instruments. There should be remedial tools in place in order to avoid problems with competition distortion. This article aims at describing the method for assessing impacts of new environmental legislation instruments on district heating systems which means assessing the current state and future development of these energy systems in economical perspective.