Jelgava District Heating Rehabilitation
(Jelgava, , Latvia)
Jelgava, a Latvian city with a population of 75,000, has a district heating system that is supplied with energy from a combined heat and power (CHP) plant and several conventional boiler-only plants—all of which burn a combination of natural gas and heavy fuel oil (mazut).
FVB helped Jelgava District Heating Company evaluate options for rehabilitating their aging district heating system. Based on our findings and recommendations, Jelgava applied to the World Bank for financial assistance and received a USD 14 million loan to pay the cost of rehabilitating the district heating system.
Following the initial study, FVB continued to provide technical support during the implementation and construction phases, including assistance in preparing plans and specifications, issuing bid tenders, evaluating bids, and negotiating contracts. FVB also managed the project, supervised construction, implemented quality control programs, and resolved issues involving warranty issues. FVB supervised all aspects of this project including: replacement of district heating piping, refurbishment of customer energy transfer stations, installation of new meters both at the customer and at the production plants, installation of heat exchangers for isolation of heating plants, installation of new variable speed distribution pumps, and upgrading of boiler equipment for automatic operation. As the project entered its completion phase during late 1999, FVB calculated tariffs and negotiated a thermal energy supply agreement with the privately owned CHP plant.
Rehabilitation of Riga District Heating System
This project started with a rehabilitation study and resulted in the Swedish International Development Agency, the World Bank, and other local commercial banks investing US$110 million into Rigas Siltums’ district heating system in Latvia’s capital city, Riga.
In the initial study, FVB examined the existing district heating system, projected future load growth, and reviewed alternatives that were both technically and financially feasible. The district heating system is located in the center of an old, well-established metropolis with 900,000 residents, and included 1,000 km (621 miles) of distribution piping, 187 distribution heating substations, and over 7,000 building energy transfer stations.
In addition to evaluating the engineering aspects of this project, FVB also examined the institutional and financial aspects of ownership and project development. Ultimately, part of the energy would be produced by Rigas Siltums from numerous conventional boiler plants, and part would be produced by the national utility company Latvenergo from one large conventional boiler plant and two combined heat and power plants. To link these two participants together, we developed a rational and fair formula for pricing thermal energy, and we negotiated an energy supply agreement between them. Our design team then prepared the final design, construction documents, specifications, and bid tenders. Since customer confidence was important to the success of this rehabilitation project, we assessed the system reliability and recommended areas where improvements and capacity expansions were needed.