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Industrial Symbiosis in Heat Recovery Collaborations Between Data Centers and District Heating and Cooling Companies

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Industrial Symbiosis in Heat Recovery Collaborations Between Data Centers and District Heating and Cooling Companies DEGREE PROJECT IN THE FIELD OF TECHNOLOGY INDUSTRIAL ENGINEERING AND MANAGEMENT AND THE MAIN FIELD OF STUDY INDUSTRIAL MANAGEMENT, SECOND CYCLE, 30 CREDITS STOCKHOLM, SWEDEN 2017 Industrial Symbiosis in Heat Recovery Collaborations between Data Centers and District Heating and Cooling Companies JESSICA LIND ERIK RUNDGREN KTH ROYAL INSTITUTE OF TECHNOLOGY SCHOOL OF INDUSTRIAL ENGINEERING AND MANAGEMENT Industrial Symbiosis in Heat Recovery Collaborations between Data Centers and District Heating and Cooling Companies Jessica Lind Erik Rundgren Master of Science Thesis KTH School of Industrial Engineering and Management Energy Technology EGI_2017-0037 –MSC SE 100-44 Stockholm Master of Science Thesis EGI_2017-0037 MSC Industrial Symbiosis in Heat Recovery Collaborations between Data Centers and District Heating and Cooling Companies Jessica Lind Erik Rundgren Approved Examiner Supervisor Per Lundqvist Commissioner Contact person Staffan Stymne Staffan Stymne Abstract Tough competition from local heating and cooling solutions fuels the pursuit of new cost- efficient heat sources for district energy companies. This master thesis explores the possibilities for a district heating and cooling company to integrate data centers for recovery of residual heat. Recovery of the residual heat from data centers into the aggregated heat demand of a district energy system can lead to less primary energy input for the two operations combined. The thesis is based on a single case study on Norrenergi, a district heating and cooling company in the Stockholm region, and nine semi-structured interviews with representatives from the data center industry. An industry interview compilation, case company interviews, and literature review were applied on a framework for industrial symbiosis. Synergies, enabling factors, and obstacles to successful cross-industry collaboration was evaluated and visualized in SWOT-analyses for four different examples of configuration for integration. The analysis shows that integration of data centers into district energy systems can provide synergies on all levels of industrial symbiosis: By-product reuse; Utility/infrastructure sharing; and joint provision of services. The data center market consists of diverse actors, with a range of business models and operational conditions. Some key obstacles to instigate collaboration are related to cultural differences, reliability concerns for district cooling, uncertainty in heat delivery potential from data centers, and data center reluctance to invest in equipment for heat recovery. To mitigate the obstacles, the energy companies should tailor the service offer for each collaboration on the diversified data center market. Residual heat from data centers should be recovered in the district cooling system, where possible. When district cooling is not accessible, energy companies should explore the possibility to invest in local heat pumps for recovery into the district heating supply flow. The thesis concludes that energy companies interested in heat recovery from data centers can apply a broad range of mitigation tools to facilitate collaborations. Sammanfattning Hård konkurrens från lokala värme- och kyllösningar driver fjärrvärmeföretag att leta efter nya, billiga värmekällor. Det här examensarbetet har utforskat möjligheterna för ett fjärrvärme- och fjärrkylaföretag att integrera datacenter i sitt energisystem för återvinning av restvärme. Återvinning av restvärme från datacenter till det aggregerade värmebehovet hos ett fjärrvärme-och fjärrkylasystem kan leda till minskad total primärenergianvändning för de båda verksamheterna tillsammans. Examensarbetet baseras på en fallstudie hos Norrenergi, ett fjärrvärme- och fjärrkylaföretag i Stockholmsregionen, samt nio semi-strukturerade intervjuer med representanter från datacenterindustrin. Ett ramverk för industriell symbios applicerades på en sammanställning av intervjuerna från datacenterindustrin, intervjuerna på Norrenergi samt en litteraturstudie. Synergier, möjliggörande faktorer samt hinder för framgångsrikt, inter-industriellt samarbete utvärderades och visualiserades i SWOT-analyser för fyra olika integrationsmöjligheter. Analysen visar att integrationen av datacenter in i fjärrvärme-och fjärrkylasystem kan erbjuda synergier som korresponderar till alla nivåer av industriell symbios: återvinning av restprodukter, delad infrastruktur och gemensam tillgång till tjänster. Marknaden för datacenter består av olika aktörer med flera olika affärsmodeller och förutsättningar för verksamheten. Några av de främsta hindren för samarbeten mellan energiföretag och datacenter är relaterade till kulturella skillnader, oro över hur pålitligt fjärrkyla är, osäkerhet för potentialen för värmeleverans från datacenter och datacentrens ovilja att investera i utrustning för värmeåtervinning. För att överbrygga hindren behöver energiföretagen skräddarsy tjänsteerbjudandet till varje samarbete på den diversifierade datacentermarknaden. Restvärme från datacenter bör, om möjligt, återvinnas i fjärrkylasystemet. När fjärrkyla inte är tillgängligt bör energiföretag utforska möjligheten att investera i lokala värmepumpar för värmeåtervinning till fjärrvärmenätets framledning. Sammanfattningsvis kommer studien fram till att för energiföretag intresserade av värmeåtervinning från datacenter så finns det flertal verktyg för att främja samarbeten. Abbreviations CapEx Capital Expenditure CHP Combined Heat and Power COP Coefficient of Performance CRAC Computer Room Air Conditioning CRAH Computer Room Air Handling DCaaS Data Center as a Service DES Distributed Energy System EIP Eco-Industrial Park GDP Gross Domestic Product GWh Giga Watt-hour HPC High Performance Computing ICT Information and Communications Technology IPSO Integrated Product and Service Offer KTH Kungliga Tekniska Högskolan kW kilo Watt MW Mega Watt OpEx Operational Expenditure PDC Parallel Data Center PUE Power Usage Effectiveness TCO Total Cost of Ownership TPA Third-Party Access Table of Content 1 Background ............................................................................................................................. 1 1.1 The District Heating Market ............................................................................................ 1 1.2 Data Centers ..................................................................................................................... 2 1.3 District Heating and Data Center Integration Projects ..................................................... 2 1.4 Case Company .................................................................................................................. 2 1.5 Problematization ............................................................................................................... 3 1.6 Purpose ............................................................................................................................. 3 1.7 Research Question ............................................................................................................ 4 1.8 Scope and Delimitations ................................................................................................... 4 1.9 Contribution ..................................................................................................................... 4 2 Method .................................................................................................................................... 5 2.1 Research Approach .......................................................................................................... 5 2.2 Case Study ........................................................................................................................ 6 2.3 Critique to Methodology .................................................................................................. 9 2.4 Report Outline ................................................................................................................ 10 3 Literature and Theory ............................................................................................................ 11 3.1 Industrial Symbiosis ....................................................................................................... 11 3.2 Experiences from Projects for Heat Recovery in Process Industries ............................. 13 3.3 District Energy Companies ............................................................................................ 14 3.4 Data Centers ................................................................................................................... 16 4 Norrenergi ............................................................................................................................. 32 4.1 Grid and Production ....................................................................................................... 32 4.2 Market Development ...................................................................................................... 35 4.3 Servitization ................................................................................................................... 35 4.4 Investments ..................................................................................................................... 36 4.5 Fuel Mix and Pricing ...................................................................................................... 36 4.6 Production Planning ......................................................................................................
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