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In green era, an old idea gains steam

Energy company, city working together to use byproduct of electricity generation to heat and cool buildings

By Beth Daley
Globe Staff / April 4, 2011

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When Veolia Energy North America recently agreed to buy surplus heat from a Cambridge power plant and use it to warm downtown Boston buildings, it was widely celebrated as a green solution to a problem of a company discharging hot, harmful water into the cool Charles River.

But the idea behind it is hardly new: For more than 80 years, a labyrinth of steam pipes under downtown Boston has silently warmed — and cooled — many of Boston’s tallest buildings. The steam system, which even heats the New England Aquarium fish tanks, is undergoing a major growth spurt in Boston as Veolia performs millions of dollars worth of upgrades and recently won or renewed long-term contracts for 19 buildings.

The only obvious outward sign of the system may be columns of steam wafting from manholes in cool weather when rain seeps underground, hits the hot pipes, and evaporates.

“Many people don’t even know these systems are there,’’ said Robert Thornton of the International District Energy Association, a trade organization based in Westborough. “But it’s competitive, it comes in a usable form for buildings, and it’s growing’’ in popularity.

District energy systems, so named because they provide heating and/or cooling to a group of buildings in close proximity, produce heat in two main ways: through large boilers usually burning natural gas or by capturing and using surplus heat from existing power plants that generate electricity, also known as combined heat and power, or cogeneration.

Steam is distributed through underground pipes to buildings that use it for space heating, hot water, or other processes, such as humidification at museums or sterilization at hospitals. The steam can also be used to drive chillers in buildings for air conditioning or go to large chillers located in the same central plant that pipe cold water out to buildings in the network.

The country has some 2,500 district energy systems, according to the International District Steam Association, and most large cities and college campuses use them. The Empire State Building and US Capitol are heated by district steam.

In recent years, as concerns about climate change have sparked greater calls for energy efficiency, cities, building owners, and energy companies have renewed efforts to capture and use the surplus heat from power plants in district heating networks rather than allowing it to disappear as waste. About 50 percent of the Boston system is currently heated with this “green steam,’’ according to Veolia.

“The net result is that we can back down our Boston production plants and reduce the natural gas we use,’’ said Stewart A. Wood, president and CEO of Veolia Energy North America. In recent years, he said, Veolia has invested close to $40 million in its Boston and Cambridge systems. “When you reduce the volume of fossil fuels consumed, you reduce the city’s carbon dioxide emissions.’’

Thomas Edison created the first large-scale combined heat and power system when he launched the electric utility industry in Manhattan in 1882, according to Thornton, producing both electricity and heat at a central station to warm nearby buildings. Today, Manhattan has the largest district steam system in the world with over 100 miles of piping serving more than 1,800 buildings from 96th Street to Battery Park.

In Boston, businesses had sometimes worked together to share boilers, but in 1930, the Boston Edison Co. bought them out and developed a citywide steam network. In recent years, Veolia has bought up the major systems in Boston (although many college campuses, such as Harvard and MIT, still have their own operations).

Thornton said the energy cost is competitive with that of natural gas and coal, because building owners do not need to construct a boiler or maintain a mechanical room and can avoid costs for equipment and eschew some insurance costs.

“We have one of the most efficient, cost-effective, and low carbon energy sources powering Boston through district steam,’’ said James W. Hunt, Boston’s chief of environmental and energy services.

Hunt said the city had problems with its aging steam system until Mayor Thomas M. Menino successfully filed legislation in 2007 that gave the Department of Public Utilities jurisdiction to regulate commercial steam companies for public safety. He said Veolia has worked hard to upgrade its system.

Veolia serves 14 of the 22 tallest buildings in downtown Boston and parts of the Back Bay. Its Cambridge network serves the biotechnology corridor near the Massachusetts Institute of Technology, and a system it co-owns in the Longwood medical area delivers steam to Harvard-affiliated hospitals.

The pipes are buried 5 to 15 feet below the ground and encased in concrete, which means workers must do some excavation to make repairs, but Veolia officials say burying allows the pipes to stay hot to keep rust from forming. Twenty-five workers monitor and maintain the Boston system 24 hours a day.

District energy systems have long been popular in densely packed European cities, but in the United States they have largely been limited to central business districts or campuses.

But climate change is sparking a new look into the old idea, and that helped spur a several-year effort by the state Department of Environmental Protection, the federal Environmental Protection Agency, Veolia, and the company that had been discharging the water into the Charles, the GenOn Kendall Cogeneration Station.

Environmental officials had grown concerned with the up to 70 million gallons of heated water GenOn Kendall is allowed to pump into the river every day. Environmentalists say the hot water kills fish and contributes to algae blooms. At the same time, Veolia was eager to tap into more waste heat from the Kendall station to provide steam to Boston.

Veolia’s purchase of the steam will cut down on 95 percent of the hot-water discharge, turning a liability into a marketable commodity for the Cambridge power plant. Veolia is now figuring out how to transport the additional steam to Boston. Today, the Kendall station supplies 50 percent of the steam used by Veolia in downtown Boston.

“I think it is a phenomenal example of good, efficient energy policy making good environmental policy,’’ said Richard Sullivan, secretary of the state’s Executive Office of Energy and Environmental Affairs. He credited coordination among the companies and state and federal officials with making it happen. “This was unique . . . but I do think there are other opportunities for this to work elsewhere.’’

Beth Daley can be reached by e-mail at bdaley@globe.com.