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District Energy System

Incorporating District Energy at the Design Stage of a Project Yields Greatest Savings


Schermerhorn Symphony CenterIncorporating district heating and cooling services (DHC) from Nashville District Energy System (NDES) into a new development at the design/conception stage can achieve reduced capital costs and reduced operating costs over the life of the development.

Perhaps the most significant economic benefit is in the form of avoided capital costs. Capital cost avoidance can have a material affect on the customer’s project viability. This is particularly true if the proposed facility is large enough to warrant chilled water generators. When DHC is designed into the project, the total building area, as well as the costs, can be reduced as a result of removing the chillers, cooling towers and a portion of the pumps and related piping and electrical. There are also structural savings, as well as aesthetic benefits, by not having to locate cooling towers atop or adjacent to buildings and by avoiding cooling tower plumes.

Utilizing district heating in lieu of boilers or electricity based heat can achieve similar opportunities for cost reductions.

Unfortunately, once a design concept begins to mature, and DHC is a post-design alternative, the full-avoided costs are lost.  If the initial design concept does not incorporate DHC, the larger utility infrastructure costs remain, structural systems relating to cooling towers and other central plant equipment remain unchanged and little credit, if any, is given for the elimination of space dedicated to in-building chillers since the balance of the facility is often developed around the mechanical room envelope.

Additionally, it is particularly challenging to encourage a designer or contractor participating in the development of design or costing to move from in-building/self generation to utilizing DHC because such changes reduce overall project construction costs and can impact respective fees. If the in-building design has already been completed, then a significant amount of time already committed to the project becomes a sunk cost and is not necessarily recoverable. Conversely, if the project starts under a DHC concept that is later determined to not meet the developers objectives, the costs to add the infrastructure, space and necessary equipment for self generation into the planning is not significantly different than if such work was incorporated initially.

In short, project owners and developers can benefit greatly by considering DHC at the earliest point in the project concept and design.

For more information about the services offered by the Nashville District Energy System to assist developers in this consideration, contact the NDES Project Administrator, Harry Ragsdale at 615-264-2611 or via email at

Article taken from February 6, 2008 paper by Harry Ragsdale, Thermal Engineering Group, Inc.