Electrification of the residential heat demand: An analysis of the power market potential to accommodate heat pumps

The share of renewables in the electric power generation is rapidly increasing and shifting the buildings heating demand to electricity represents a sustainable solution to decrease the fossil fuel dependency. In this paper, the maximum share of heating demand that can be switched to electricity by using heat pumps, according to the power market capacity, is estimated. By determining market price, plants generation and fuel consumption, the optimal share is calculated in terms of carbon emissions minimization. The methodology is developed with the support of a bid stack model (BISM) that performs an hourly simulation of the electricity market. Firstly, the analysis is led considering values of the heat pumps coefficient of performance, COP, in the range between 2 and 4. Then a focus is made on the COP dependence on local climatic conditions. In addition, three different time schedules of heat pumps activity are modelled to simulate the final users’ habits. Italy is considered as a case study to test the model. Italian market conditions are particularly favourable for the heat pumps utilization. The analysis is developed ex-post for the year 2019 as well as an outlook for the 2030 is provided. For the 2019 results show that the Italian electricity market allows a penetration of heat pumps in the range of 10%–56% for COP values between 2 and 4. In 2030 switching rates in the order of 5%–10% are estimated due to tighter market conditions.