Waste Heat and the Future of District Heating Systems in Ireland
Wednesday, 05 March 2025
In its Programme for Government 2025, the Irish Government plans to enact legislation to accelerate the roll out of district heating systems in Ireland. A key focus is the capture of waste heat from data centres. In this article, we explore what district heating systems are, where they are operating in Ireland, and how the government plans to facilitate their expansion in Ireland to the support the country’s climate goals.
What is a district heating system?
District heating is a network of underground insulated pipes connected to a centralised energy hub that delivers energy in the form of heat to buildings connected to the network. Each building (be it commercial, public, or single residential unit) is metered, much like your electricity meter, and customers are charged based on their heat consumption. The system distributes heat in the form of hot water or steam and removes the need for boilers to be installed in houses and buildings.
Where does the district heating system get its heat from?
The heat is produced in a central location using one or a combination of (i) fossil fuels, (ii) renewable energy or (iii) waste heat. Waste heat is not heat from burning rubbish, but rather excess heat produced as a by-product of another industry, for example waste heat from electricity production. In practical terms, think of the heat off a car engine after it has been driven. Data centres are a large producer of waste heat due to their uninterrupted operation of IT equipment and cooling systems.
Are there any district heating systems in Ireland?
The Tallaght District Heating Network at the Heat Works Energy Centre was officially opened in April 2023. Heat Works is Ireland’s first not-for-profit energy facility owned by South County Dublin County Council. The network initially provides heat to 32,800m.sq. of public buildings (including the Tallaght campus of Technological University, Tallaght County Hall, and Tallaght County Library) and plans to also provide heat to affordable apartments in the area. This network uses waste heat from a nearby Amazon data centre to provide low carbon heat to the network’s customers. Heat Works states that during normal operation, heat demand will be 100% covered from the data centre waste heat.
The Dublin District Heating System plans to use waste heat from the Dublin Waste to Energy facility as the primary heat source to heat residential and commercial buildings in the Dublin Docklands and Poolbeg Peninsula. The Dublin Waste to Energy facility has the equipment installed to send its waste heat into the District Heating System, but is not yet operational. It is not clear when the system will be operational.
What are the Government’s plans?
The Climate Action Plan 2024 (the “Action Plan”), includes the ambition for Ireland to reach up to 0.8 Terawatt-hour (“TWh”) of district heating installed with capacity across both residential and commercial building stock by 2025 and up to 2.7 TWh by 2030. To do this, the Government plans to implement the recommendations of the August 2023 report of the District Heating Steering Group.
The District Heating Steering Group was formed under the Climate Action Plan 2021, as part of the Government’s commitment to further the expansion of district heating in Ireland. The District Heating Steering Group coordinates the rollout of policies and measures to support district heating in Ireland.
In their 2023 Report, the District Heating Steering Group recommended:
- Draft legislation to support the development and expansion of district heating networks and to attract investment. This recommendation has been incorporated into the Programme for Government 2025, with the intention to enact legislation this year.
- Mandate that public sector buildings connect to available district heating networks (where available, and where technically and economically feasible), and that industrial facilities supply waste heat to district heating where the total rated energy input is at least 1 MW.
- Provide for a single technical standard that facilitates the growth and strategic interconnectivity of district heating systems and makes provision for State ownership of district heating infrastructure in the longer term.
- Adopt a centrally-planned approach to development of the district heating sector with, in time, a single State entity or a utility overseeing the development and expansion of networks, providing the skillsets, expertise and knowledge required by project sponsors in the short term.
- Finance of district heating systems should be predominantly market based, with the provision of supports (such as domestic connections to a network) consistent with other decarbonised heat sources.
The Action Plan states that although approximately 50% of the heat demand in Ireland can be met through district heating, it will require significant resources to install a network of approx. 1,000km along Irish Roads. It also states that significant investment will be required to support such networks at an estimated overall capital cost of €2.7 - €4 billion, and that legislative and regulatory systems must be developed to underpin the sector.
Has a regulator been established to regulate District Heat Systems in Ireland?
Yes, the Commission for Regulation of Utilities (“CRU”) regulates the District Heating and Cooling Networks in Ireland. Any district heating suppliers must register with the CRU. The CRU will ensure final customers are provided with competitively priced meters that accurately reflect their actual energy consumption. They will also develop national rules on allocation of cost of heating and cooling, and domestic hot water in multi-apartment/multi-purpose buildings. They are currently developing a regulatory framework for the sector.
What’s next?
District Heating is a relatively new concept in Ireland but it is set to grow and is an important part of the plan to decarbonise our energy supply.
If you need advice, please contact Claire O’Reilly, Alison O’Sullivan, Mona Costelloe, Gráinne Murphy, or your usual Byrne Wallace Shields LLP contact.
