Long-term Green Innovation Opportunities Within the Hungarian District Heating Sector Towards 2030

Abstract

Natural gas is still the primary input of the Hungarian heating and cooling systems, therefore it still makes most of the overheads. One of the main obstacles of a competitive district heating system is the public opinion which still considers this service more expensive than the traditional heating forms. According to the absolute numbers this assumption might be valid but from a more accurate economic perspective, heat production has more aspects to stress. Most people forget about the simple fact that the maintenance costs of natural gas based systems are rather outsourced to the consumer than in the case of district heating. Furthermore, the uneven rate of the fixed and variable costs of this technology does not prove to be optimal for service developments. Investigating the future tendencies highlight that encouraging the efficiency improvement of district heating and the spread of technological innovation in the sector does not belong to the top priorities. Still, avoiding this problem it could lead serious deadweight losses in the case of the heating sector.