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Vattenfall and Oxelö Energi secure long-term district heating deal for Oxelösund

In Sweden, energy major Vattenfall AB and municipal energy company Oxelö Energi AB have signed an agreement on a long-term sustainable district heating solution for Oxelösund. According to the agreement, the district heating network in Oxelösund will be connected to Vattenfall's biomass-fired combined heat and power (CHP) plant Idbäcksverket in Nyköping.

I am delighted that Oxelö Energi has chosen to work with us to find a long-term sustainable solution for district heating in Oxelösund. The agreement makes it possible to utilize spare capacity at our combined heat and power plant in Nyköping for district heating also in Oxelösund, which benefits all parties, said Lovisa Fricot Norén, Head of Vattenfall Värme in Sweden.

The new district heating supply is expected to be put into operation in 2025 when the current waste heat supply from SSAB Oxelösund’s steel mill ceases.

Through the collaboration with Vattenfall, we can get a biomass-based district heating production at a significantly lower investment compared to building our own plant in Oxelösund. The production also has better conditions to have high delivery security as there are more biofuel boilers at the plant in Idbäcken, said Benita Vikström, Chairman of Oxelö Energi.

The new district heating solution is a consequence of district heating based on surplus heat from SSAB in Oxelösund disappearing after the blast furnaces and coking plant are expected to close in 2025 as a result of electrification of the steel production process at SSAB.

We have evaluated several alternatives and come to the conclusion that this solution is the cheapest and most sustainable alternative. Building our own biomass-based heating plant in Oxelösund would have been significantly more expensive. The price for district heating will increase, but not as much as other alternatives, said Per Koman Alm, CEO of Oxelö Energi.

Fuel loading at Vattenfall’s Idbäcksverket biomass-fired combined
heat and power (CHP) plant in Nyköping, Sweden (photo
courtesy Vattenfall).

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