War in Ukraine: Will the energy crisis mean the end of Communist-era district heating systems?

Under Communism, many eastern European countries set up the schemes, utilising networks of underground pipes which powered heating in blocks of flats. In many cities, historic town centres were bulldozed to make way for the apartment buildings, which were regarded as efficient living conditions by Communist leaders.

Even after the fall of Communism in 1989 – and 1991 in the Soviet Union – many countries continued to rely on the district systems, which are switched on and off at the will of the local authorities, who decide when it is cold enough to put the heating on, rather than devolving the decision to the householder, dependent on the comfort level of their home.

Residents of some countries were then billed accordingly on a set average cost, with the charges rising or falling depending on how much the state deemed it necessary to heat the city’s homes. In others, such as Bulgaria, the energy market was set up so there was a set, regulated price for consumers.

As a result, many properties were heated to a higher temperature than necessary, with many locals becoming used to warm homes. Many Ukrainian refugees now living in the UK have expressed horror at the low temperatures which British people tolerate in their homes.

This week, Dan Nicusor, the mayor of the Romanian capital of Bucharest, admitted he needs to borrow €100 million (£86m) to pay a debt to the energy company that supplies the city’s heavily subsidised district heating system.

The local authority pays two-thirds of the heating bills for those using the system – a major subsidy at a time of volatile energy prices. Compared to an average European wholesale cost of about €190/MWh on February 1, prices in some countries reached more than €600/MWh by September.

Romanian Prime Minister Nicolae Ciucă has told the mayor of Bucharest the debt is a “local authority problem” and has refused to offer up any more money for the capital’s heating bills, forcing the city council to go out to tender for a costly loan.

In reality, it is an issue that affects not only Bucharest – and the rest of Romania – but the whole of the eastern bloc. Around 10 per cent of Europe’s homes are still powered by district heating systems, many of them in former Communist countries.

In Ukraine, 53 per cent of urban households still relied on centralised heating last year, according to data from engineering firm Tetra Tech. The war-torn country is now experiencing a major energy crisis and frequent blackouts, due to widespread damage from Russian bombs.

However, in August, before the attacks on the country’s energy system, the country’s gas chief warned due to natural gas shortages, indoor temperatures on the system would be set to around 18C – more than 3C lower than normal.

Professor Andreas Goldthau, director of the Willy Brandt School of Public Policy at the University of Erfurt in Germany, said he believed central Eastern European countries would not rush to change the system, despite the pressure on budgets.

“Everyone in Europe, including the UK, is firefighting,” he said. “There was a crisis and they need to deal with it. Gas prices go through the roof, but you’ve got to make sure that things stay afloat and that people don’t freeze.

"There's a pattern, particularly in the end consumer market in eastern Europe, where you have a public utility model, which refers to a regional municipal energy provider, state owned for most part. States ended up subsidising heating energy services, including heat, but also in part, electricity and gas. And this is something that now hits budgets hard because prices go through the roof. Whether that is sustainable for the municipalities is another question.”

Goldthau points to the environmental inefficiency of the Communist-era systems, but warns they would be difficult to decarbonise – and said he believed there was little political appetite to consider alternatives.

"I spent some time in Russia and there, in October, someone flicked the switch and whoosh, the heat came on,” he recalled. “But it was too warm and all you could do was open the windows. It was incredibly inefficient.

"If you want to implement climate policies and decarbonise the system, what you want to do is give alternative suppliers a way in. But those centralised systems, the infrastructure is hardwired into the system. Plus, there's a strong political economy.

"Who, amongst the public utilities, would have an interest in anyone coming in saying ‘oh, let's break up the energy system. And by the way, let's inject more competition and bring in alternative sources including geothermal?’”

Before the invasion of Ukraine, some eastern countries were planning to switch their district heating systems from coal fired power stations to fossil gas. However, the soaring price of gas since the war broke out has put a halt to many upgrades.

Speaking at an online event hosted by European news organisation Euroactiv, Stefan Moser, head of the the buildings and products unit at the European Commission’s energy department, said that doing so would require a “major effort”.

“We have a challenge with de-carbonising the larger systems, which historically have been based on fossil fuels – it requires a major effort to phase them out,” he said.

In Czechia, authorities are working on breaking large systems down into smaller sections and installing heat pumps or geothermal technology.

Not everyone in eastern Europe, however, is on the centralised system, with some residents insistent it is more economical to have a private boiler. In the post-Communist years, many people with the financial means to do so invested in gas boilers for their homes, which could be controlled by a thermostat – meaning they could decide when and how much to heat their properties.

Lia Herteg, an IT worker who lives in Cluj-Napoca, Romania, said her family invested in a new boiler for their apartment some years ago, leaving the centralised system. Subsidies vary between cities, with centralised heating policies generally drawn up by local authorities.

"I think a lot of people made the switch because at one point, the bills got ridiculous,” she said. “In Cluj and cities in general, a lot of people have their own boilers now, but there are still some flats that are connected to the central system. You can control it a lot better and you don’t have to cover the losses – a lot of water and heat is lost within the district system, it is not very efficient. You couldn’t control anything under the old system, they just put heat through and you paid for whatever they pushed through – it came in the monthly maintenance bill for the flat.

"It is probably more common in [western Romanian city] Oradea, as they have thermal waters there, which provides the heating.”

She adds: “One year, I got a surprise 1,000 lei (£200) bill as they did some sort of adjustment to my payments, so now I set aside extra money for that. This year, I wear my house robe a lot more and started taking what we call here ‘Scottish showers’ – a burst of hot water, followed by cold – to try to keep the bills down.”