The Municipality of Kozani is the largest municipality in the Region of Western Macedonia. Home to more than 65 thousand inhabitants, the city is a pioneer in environmental issues and energy management, leading the way towards a sustainable, secure, and affordable future.
As an EU Mission City, Kozani is committed to achieving a 100% reduction in CO2 emissions by 2030. A major challenge to reach this goal is the replacement of lignite as the source of thermal power through the gradual introduction of renewable energy sources. Therefore, Kozani launched a Pilot Activity, NEUTRON (Net-zero Energy fUture through the identification of innovative Technologies under a circulaR, sustainable and inclusive just transitiON), to develop climate neutrality transition pathways for the building sector, targeting electricity, heating, and cooling.
The Municipality of Kozani has successfully operated a district heating system through DEYAK, Kozani’s municipal district heating company, since 1993. It covers 99% of the geographical area of Kozani and provides heating to more than 28,000 households. Historically, the system primarily relied on lignite-fired power plants. However, with the planned phase-out of lignite-based power generation in Greece by 2028, Kozani is committed to upgrading the district heating system with cleaner energy sources, ensuring a just transition for the region’s economy, workforce, and energy consumers.
The transition away from lignite use poses both financial and technical challenges. Natural gas has been accepted as an intermediate solution, while the shift to renewable energy offers opportunities for innovation, sustainability, and long-term economic resilience. Therefore, the NEUTRON Pilot focused on developing a technological solution to support the transition using innovative technologies and renewable energy sources.
The proposed technical concept uses a Green Heat Module to enable energy storage and on-demand supply, thereby addressing the volatility of electricity supply from renewable energy sources and the market. The Green Heat Module is essentially a thermal battery with a 500 MWh storage capacity. It utilises ceramic storage material with very high energy density, enabling the storage of heat between temperatures of 750°C and 1000 °C. Due to the high storage temperature, a combined heat and power plant is run from the stored energy, providing valuable electricity output on demand in addition to the heat supply of the district heating.
The Green Heat Module can use excess grid electricity or locally produced electricity from renewable sources. In NEUTRON, the pilot team explored renewable energy production using Agrivoltaics – photovoltaic (PV) parks combined with the cultivation of agricultural crops. The dual use of land for the production of solar energy could enable a symbiotic coexistence of renewable energy and agricultural production, providing benefits not only to the municipality but also to local farmers and communities.
Additionally, the technical concept examines the utilisation of organic (and not only) waste for biogas production, i.e., agricultural waste, sewage sludge, and the organic waste stream of Municipal Solid Waste. The produced biogas will be used as an input to the Green Heat Module system for heat and power generation, supplementing renewable energy storage during periods of low renewable energy production.
During the NEUTRON Pilot, the Solar-Institute Jülich of FH Aachen, in cooperation with Kraftanlagen Energies and Services, did a comprehensive simulation and study of the overall system to determine the feasibility of the model using the market data for Greece and Kozani’s heating network. The key findings showed that the cost of heat would be less than 30 EUR/MWh, which is lower than the cost when using natural gas and 100% free of CO2 emissions. Moreover, using a locally based system will enable the creation of local jobs for operating and maintaining the technical systems. It is estimated that the envisioned large-scale plant will require approximately 65 full-time employees to operate it.
What were the key drivers of the initiative?
National policy: Greece is committed to phasing out lignite-based power generation by 2028 while increasing the use of renewable energy sources to achieve a complete decarbonisation of the Greek power system. With 80% of the Greek lignite industry based in the region of Western Macedonia, there’s an increased urgency for the region and the Municipality of Kozani to find sustainable alternatives while addressing the socio-economic impacts of the phase-out.
Local climate strategy: Kozani’s Climate Neutrality Action Plan foresees a phased transition from lignite-based heating to a diverse mix of cleaner energy sources. While the municipality envisions using natural gas as an intermediate solution, the long-term objective is to bring Kozani’s district heating system close to climate neutrality, with a CO₂ emissions reduction of over 90%.
Collaboration: The NEUTRON Pilot brought together eleven partners from three different countries. Led by the Municipality of Kozani, the Consortium involved local stakeholders (DIADYMA SA-Waste Management of Western Macedonia Region, and DEYAK-Municipal Enterprise for Water Supply and Sewerage of Kozani), national actors (ZEUS Helios Electricity Company Ltd., ABB SA Greece, Ergoncell, Etairia Hydrefsis kai Apochetefsis Thessalonikis AE (EYATH SA)), Greek knowledge institutions (Aristotle University of Thessaloniki (AUTH) and Ethniko Kentro Erevnas kai Technologikis Anaptyxis (CERTH)) and international partners (Solar-Institut Julich of the FH Aachen University of Applied Sciences (SIJ) and Kraftanlagen Energies & Services). The technical partners (DEYAK, ZEUS, AUTH, SIJ, and Kraftlagen) played a crucial role in developing the locally applicable concept.
Learning: The knowledge exchange on energy storage technologies and energy management systems was significant for the conceptualisation of the Pilot. The Piloting team also took the opportunity to visit a state-of-the-art thermal energy storage facility, MultiTESS, which served as an inspiration for the NEUTRON Pilot’s technical concept.
What were the challenges and barriers?
Funding: The implementation of the NEUTRON concept requires high upfront costs for infrastructure, technology integration and risk mitigation to demonstrate the technical and economic viability. Therefore, the Municipality, along with its partners, is looking into ways to fund a feasibility study, construction, and operation of demo and large-scale plants. For this purpose, Kozani is in close contact with the NetZeroCities team to find suitable funding mechanisms and tools for the design and construction of such a system.
Regulatory barriers: The operation of a system like Green Heat Module based on energy storage requires a strong regulatory basis for sector coupling technologies with thermal storage, including taxes, fees, and special regimes for Greece. Moreover, the evaluation of the system and ownership structure is crucial in the context of the regulatory framework of the Greek energy market. To reach a coherent conclusion, apart from the extensive research performed within NEUTRON, Kozani has requested expert (CESF) support, which is still ongoing.
Social acceptance: The level of societal mistrust and disbelief related to the use of renewable energy is comparatively high. Therefore, the Piloting team has been working on improving the messaging and communication to address the prevalent belief that the solutions proposed by NEUTRON would be very expensive and not benefit local communities. Continuous conversations and the promotion of energy independence through collective actions, enabling participatory energy democracy, were crucial to the success of the Pilot.
Potential for replication
The NEUTRON concept or its technological components can be replicated in other Greek or EU cities, aiming to make their district heating systems more sustainable and resilient. It is a good example of a new generation district heating system that leans towards decentralised generation of heat and takes advantage of all available local energy sources. Furthermore, Kozani’s Twin City, Alba Iulia (Romania), has already expressed interest in the Green Heat Module and Agrivoltaics as two possible solutions for replication. Both solutions align with Alba Iulia’s goals for energy efficiency, renewable energy use, and climate change mitigation.
Other cities can learn more about NEUTRON Pilot through freely available online courses. The Solar-Insitut Jülich of the FH Aachen, together with NEUTRON’s industrial partners, has developed a course on NEUTRON’s technical concept to enable a better understanding of the Green Heat Module and its applicability in district heating systems. The course is designed to facilitate knowledge transfer and enable other cities to use the NEUTRON concept as a blueprint for greening their district heating systems.
Header photo: © Nikos Koutoulas from Kozani, Greece, CC BY 2.0