Effectiveness of introducing heat storage to repress cost increase

District heating companies have been adapting their price models to reflect the changes in production cost caused by penetration of renewable fuels, and promote the applications of energy conservation measures that benefit the system efficiency. One of the approaches is to introduce a peak demand component in the price model, which has been proved to be effective to benefit users with lower peak demand. Whereas, this approach also significantly increase the cost for users with high peak demand. One of the measures that could help with high peak demand is installing energy storage on the demand side. In order to understand how the energy storage could change the users’ cost and help DH users to make informed decision, this study analyses the economic benefits of demand-side heat storage, namely if installing low-investment, low-tech, short-term hot-water storage on demand side could effectively repress the cost increase caused by new price models. Five types of building are considered here: multifamily house, commercial building, hospital and social services, industrial building, and office and school. One user of each type, whose costs increased the most during the price model transition process have been included. The result shows that heat storage could efficiently repress the cost increase, and all the investments will be paid back within 3 years, which means introducing heat storage is an efficient measure for cost saving under the circumstances