This data-file models residential heating energy from first principles, taking an example in Northern Europe, for a house with 150m2 floor space, requiring 15MWth of heat (space heating and hot water), which is met by consuming 5MWH-e pa in a heat pump, costing $1,500/year. But this can also be optimized.
Residential heating comprises 13% of total global energy demand. We have a separate model capturing the relative costs of home heating systems, from gas boilers to ground source heat pumps.
But in this data-file, we break down residential heating energy from first principles, similar to the way we have assessed household AC demand from first principles.
Heat flux out of a home can simplistically be modeled as a function surface area x heat transfer coefficient x temperature delta between the inside temperature and outside temperature.
Hence the heat flux out of a home will increase linearly with the home’s external surface area, decrease with greater insulation, increase in colder climates, and decrease if you turn down the thermostat.
This also explains why multi-family apartments, which share interior walls, are cheaper to heat than detached houses. Heat leaks from your neighbor’s apartment into your own and vice versa.
The timing of heating demand thus also depends on external temperatures, which vary throughout the year. In this data-file, we have taken the temperatures throughout the year in Northern Europe.
Homes that make their heat in real time consume energy – gas or power – at the rates required by their internal thermostats will often end up buying heat when conditions are coldest.
This means cold weather can strain the gas distribution network, or increase power prices. In Northern Europe, hourly electricity prices are -33% correlated with external temperature (10% R-squared).
Can residential heating systems arbitrage grid volatility? There is an opportunity for homes consuming electric heat, including in heat pumps, to load-shift the timing of hot water production, to off-peak hours, as a full 200l hot water tank can typically provide 4-hours of a home’s heating needs as discussed in our note below.
We estimate that load-shifting a hot water tank using a smart controller can halve the wholesale electricity cost component of home heating, for consumers on a time-of-use tariff, and improve the economics of heat pump ownership.
Please download the data-file for a breakdown of residential heating energy consumption from first principles, and to see how load-shifting a hot water tank can halve wholesale electricity costs for heating.