The use of renewable energy systems for both domestic and industrial heating and cooling applications has received relatively little attention compared with renewable electricity or transport biofuels. Where a good biomass, geothermal or solar thermal resource exists, heating technologies can often be competitive with those using fossil fuels.

In a few countries their natural deployment has occurred with little if any policy support, resulting in greenhouse gas reductions. Elsewhere, several of the few national policies in place to remove barriers and encourage the greater deployment of renewable heat, (such as from using wood-burning boilers, geothermal ground-heat pumps, and solar water heaters) have proved to be cost-effective, yet other countries have been slow to replicate them. In regions where cooling has a greater energy demand than heating, especially during peak summer periods, renewable energy cooling systems show good potential for further development.

This timely report examines the technologies, current markets and relative costs for heat and cold production using biomass, geothermal and solar-assisted systems. It evaluates a range of national case studies and relevant policies. Should the successful and more cost-effective policies be implemented by other countries, then the relatively untapped economic potential of renewable energy heating and cooling systems could be better realised, resulting in potential doubling of the present market within the next few years.

PREFACE
In April 2006 the IEA hosted a seminar “Renewable heating and cooling – from RD&D to deployment technology and policy” aimed at exploring guidelines and policy initiatives that could accelerate technology development and market deployment for renewable heating and cooling (REHC). The IEA Renewable Energy Working Party (REWP) and the related Bioenergy, Geothermal, and Solar Heating and Cooling Implementing Agreements agreed to collaborate in order to present the current status of technologies, markets and successful policies and to explore future technology and policy trends.

The REWP then determined that REHC is of such high importance that it merited the preparation of a full IEA report, prepared by the IEA Renewable Energy Unit, and based on the presentations and the discussions of the workshop.

Coincidentally a second report “Renewable energy technology in heating markets - Policy status” had been commissioned by the Implementing Agreement on Renewable Energy Technology Deployment (RETD; www.iea-retd.org). This was being researched and written by the Centre for Solar Energy and Hydrogen Research, Baden-Württemberg (ZSW) in early 2007. ...

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Executive Summary

Renewable energy heating and cooling (REHC) has been described as the “sleeping giant” of renewable energy potentials from the global perspective. Mature REHC technologies using solar, biomass and geothermal resources are currently available as cost-effective means of reducing both carbon dioxide emissions and fossil fuel dependency under many circumstances. Other technologies are close to mass-market deployment. Governments, including those endeavouring to meet challenging greenhouse gas (GHG) emission reduction targets, could find that considerable mitigation potential exists through the displacement of fossil fuels, usually, but not always, at relatively low costs per tonne of CO2 emission avoidance.

In recent years, and in many regions, policies developed to encourage the wider deployment of renewable electricity generation, transport biofuels and energy efficiency have over-shadowed policies aimed at REHC technology deployment. Yet heating and cooling demands by the industrial, commercial, and domestic sectors constitute around 40-50% of the total global 320 EJ (7 639 Mtoe) final energy demand in 2004. REHC technologies have the potential to gain a greater share of this large market. Several countries have already exploited this opportunity such as Sweden where biomass supplied 62% of fuel for district heating in 2006. ...

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The International Energy Agency (IEA) is an autonomous body which was established in November 1974 within the framework of the Organisation for Economic Co-operation and Development (OECD) to implement an inter national energy programme.

It carries out a comprehensive programme of energy co-operation among twenty-seven of the OECD thirty member countries. The basic aims of the IEA are:

• To maintain and improve systems for coping with oil supply disruptions.
• To promote rational energy policies in a global context through co-operative relations with non-member countries, industry and inter national organisations.
• To operate a permanent information system on the international oil market.
• To improve the world’s energy supply and demand structure by developing alternative energy sources and increasing the effi ciency of energy use.
• To promote international collaboration on energy technology.
• To assist in the integration of environmental and energy policies.

The IEA member countries are: Australia, Austria, Belgium, Canada, Czech Republic, Denmark, Finland, France, Germany, Greece, Hungary, Ireland, Italy, Japan, Republic of Korea, Luxembourg, Netherlands, New Zealand, Norway, Portugal, Slovak Republic, Spain, Sweden, Switzerland, Turkey, United Kingdom and United States. Poland is expected to become a member in 2008. The European Commission also participates in the work of the IEA.

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