What is it?
District heating systems consist of a network of underground pipes that distribute heat to a large number of buildings, including industrial buildings. In the industrial sector, district heating is used by light industries and for processes such as drying, paper making, food processing, as well as space heating and even heat-driven refrigeration (Bellevrat & West, 2018; Difs et al., 2009). Industry is well suited to district heating because it typically has steady and predictable heat demand throughout the year. Current district heating systems rely heavily on coal and natural gas for heat generation, often as part of combined heat and power generation (IEA, 2026). Low-carbon alternatives for district heating can include electric boilers, electric heat pumps, solar thermal, deep geothermal, and even waste heat from other industries (IEA, 2026; International Renewable Energy Agency [IRENA] et al., 2020).
Does it work?
Shifting district heating for industry from conventional heat sources to low-carbon heat sources will significantly reduce emissions. Our analysis for district heating use by commercial and residential buildings shows that significant emissions can be avoided by shifting to electric boilers, heat pumps, and the use of waste heat (see Improve District Heating: Buildings). Similar outcomes are likely possible for industrial district heating use, and emissions reductions will increase as more renewables are integrated into the electricity systems used to power electric boilers and heat pumps.
Why are we excited?
District heating for industry currently produces significant emissions. According to the IEA (2026), district heating and cooling for all applications accounted for roughly 5% of global energy consumption in 2024, and roughly 40% of the heat energy from district heating was delivered to industry IEA, 2022). China is a major adopter of district heating for industries, with the combustion of coal supplying much of that heat (IEA, 2026). The shift to renewable heat sources is likely to increase because both China and the EU have policies targeting the adoption of renewables in district heating (European Commission, 2022; IEA, 2026). Because district heating systems serve multiple buildings, a single project to replace fossil fuels with renewables can have a large impact. Such projects also have the benefit of reducing local air pollution.
Why are we concerned?
Although simple on paper, replacing fossil fuel systems with lower-carbon alternatives in district heating systems can be an extended undertaking involving many stakeholders and years of planning (Lake et al., 2017; Werner, 2017). Some low-carbon options may not be suitable for industrial processes that require higher temperatures than those needed for space heating (Bellevrat et al., 2018). There is also a significant lack of publicly available data about how industry currently uses district heating and the opportunities and challenges involved in shifting to renewables. In the meantime, industrial heat pumps with higher temperature outputs are increasingly available and could become a low-carbon competitor to the use of a conventional district heating system (IEA, 2026).