Studying the construction of a district energy system in downtown Kitchener
Type of initiative
FCM Green Municipal Fund - Plans, Studies, Pilots
Sector
Energy
Project value$158,700
Project Type
Feasibility Study
Sub Sector
District Energy – Renewable source
Grant amount$79,350
Program type
GMF
Municipality
City of Kitchener, ON
Status
In Progress
Population
256,885
Project timeline
2022 -
Project number
DFC-22-0043
Description
The City of Kitchener (City) has ambitious goals of advancing community energy solutions in pursuit of climate, economic and energy security objectives. One means of advancing community energy solutions involved implementing an open loop geoexchange district energy system (“DES”) serving the broader Downtown Kitchener geography.
The City will be undertaking a detailed technical and financial analysis specific to implementing an open loop geoexchange DES in Downtown Kitchener. The analysis will be informed by the “Kitchener Innovation District DES Pre-Feasibility Study” prepared by FVB Energy Inc. (FVB) and result in Class 2 technical and financial analysis, as defined by the Association for the Advancement of Cost Engineering (AACE) criteria. The objective of this project is to provide the City with a detailed technical and financial understanding associated with implementing a DES in Downtown Kitchener, beyond what was provided in the Pre-Feasibility Study. This project will better allow the City and/or other investment partners to make informed decisions around how best to move forward with developing a DES.
The Pre-Feasibility Study found that “based on the proposed development timelines and densities projected for downtown Kitchener, it is concluded that there is potential to establish a DES with a positive business case. The DES concept proposed for downtown Kitchener would serve approximately 416,000 m2 (4,485,000 ft2) of new development in four phases between 2023 – 2029.” The preferred scenario identified in the Pre-Feasibility Study, Scenario 2, found that a “DES using base loaded open-source ground source heat pumps/heat recovery chillers with conventional technologies used for peaking and back up, has the next (second) highest buildout cost of $47M and IRR of 5.3% over 25 years (relative the other scenarios examined). The GHG reduction is estimated at approximately 5,100 tonnes (53%) of CO2 reduction (compared to Business as Usual).”
The Pre-Feasibility Study also identified benefits to the City, Region of Waterloo, and the private sector. These benefits include: increased resiliency and reliability of heating and cooling systems; increased environmental and energy efficiency of these systems; increased flexibility of building design that reduces mechanical and electrical service and rooftop space that would have otherwise housed boilers and chillers; boosting the local economy by creating construction and operations and maintenance jobs; and improving public and consumer safety through the elimination of building-source carbon monoxide poisoning and reducing the risk of Legionella bacteria by eliminating the need for building-specific cooling towers.
Kitchener is also one of two municipalities in Ontario that own a natural gas utility, Kitchener Utilities (“KU”). Should KU be identified as the preferred owner/operator of the DES, there is an opportunity for the utility to sustainably diversify their business, adding a DES to their existing natural gas portfolio.
Applicant
City of Kitchener, ON