The Swedish district heating sector is currently undergoing a period of transition, where new challenges in the energy market demand fresh thinking and long-term strategies. In recent years, rising prices for forest fuel and increased competition for biomass have highlighted the importance of securing a sustainable and diversified fuel supply. To explore potential solutions to these challenges, Sinfra initiated a preliminary study – “The Biofuel Challenge”, led by Sigholm.
Pre-study on Developing a More Robust and Diversified Fuel Portfolio for District Heating Companies
The aim of the study was to analyse the opportunities for district heating companies to develop a more robust and diversified fuel portfolio. In collaboration with district heating operators, suppliers, and logistics specialists, the study explored, among other things, the potential for sourcing forest fuel from underutilised resources in northern Sweden and establishing long-term contracts for more stable and predictable fuel prices.
“The study provided us with valuable insights into how Sinfra could become involved in ensuring a more secure forest fuel supply for our members.”
– Tony Doganson, CEO, Sinfra
Although the project did not result in immediate implementations, the study identified several strategic opportunities for the sector. For instance, it demonstrated that through joint procurement strategies and investments in infrastructure, district heating companies could benefit from previously untapped resources, potentially reducing both system and delivery risks.
What Made the Study Unique?
What made this pre-study particularly significant was its comprehensive perspective and approach. With the help of simulation tools from Sigholm and other providers, as well as expertise in competition law, the project was able to explore realistic alternatives for a more sustainable and cost-effective fuel supply.
Sigholm’s Contributions:
- Insight-driven strategy and analysis
- Modelling of logistics flows and fuel optimisation
- Focus on identifying long-term solutions for a competitive district heating sector
- Use of simulations to support decision-making
“The Biofuel Challenge” pre-study highlights the potential of a more strategic approach to managing the district heating sector’s fuel assets. By outlining various paths forward, the project has provided district heating companies with important tools to tackle future challenges – even though the proposed alternatives require further investigation and coordination in order to be realised.
