1
District Cooling as an Energy and Economically
Efficient Urban Utility
– Its Implementation at Marina Bay Business District in Singapore
Tey Peng Kee, Singapore District Cooling Pte Ltd
Abstract-- In a resource-constrained country like Singapore,
energy conservation and efficiency are strategic measures to
reduce carbon footprint. As air-conditioning accounts for
major energy usage in commercial buildings, chiller plant
efficiency has attracted considerable interest and attention.
District cooling is an energy efficient outsourcing alternative
to in-building chilled water production.
This paper presents as a case study the implementation of
district cooling system at Marina Bay, a new business district
in Singapore. In addition to the technical features of the
system and attributes of the new utility service, the paper
describes the regulatory framework and commercial
arrangement adopted. The paper also provides a
comparative discussion on how a district cooling system
could effectively elevate the energy efficiency for air-
conditioning in a commercial district in a cost-efficient
manner.
Index Terms—Air conditioning, chiller plant, district
cooling, energy efficiency, utility service.
I. INTRODUCTION
Singapore relies completely on import for its energy
needs. Energy conservation and efficiency are key
strategic responses to address growing concerns on global
warming. For a city in the tropics, air-conditioning is an
essential service for commercial buildings. In Singapore,
about 70% of electricity usage in commercial buildings is
related to air-conditioning and two third of which in
chiller plants. Chiller plant efficiency has accordingly
become a key area of attention in initiatives to improve
the energy efficiency of commercial buildings.
District cooling is an outsourcing alternative to in-
building chilled water production for air-conditioning. It
is well suited for commercial districts with high cooling
load density. It raises the energy efficiency related to air-
conditioning more effectively on a global scale.
A large-scale district cooling system has been
successfully implemented for Marina Bay Business
District in Singapore (Fig. 1).
Fig 1. Marina Bay Business District (an artist’s impression)
II. BRIEF HISTORY
In mid 1990’s, Urban Redevelopment Authority
(URA), the town planning authority in Singapore,
conducted feasibility study and planning for the
construction of common services tunnels in the new
business district for accommodating utilities lines. As part
of the feasibility study, district cooling was identified as
an urban utility for the new business district. Provision
was made in the design of the common services tunnels
for accommodating chilled water pipes.
Singapore Power 1 and Dalkia 2 conducted a feasibility
study and confirmed the commercial viability of the new
utility service. They went on to form Singapore District
Cooling (SDC) as a joint-venture to implement the pilot
system.
The first district cooling plant was completed and
commercial operation commenced in May 2006.
III. DESCRIPTION OF THE SYSTEM
The original Master Plan envisaged a service area with
over 8,000,000 sq m in gross floor area. The cooling load
was estimated to be about 900 MWr, which could be
served by five district cooling plants. In order to optimize
land use, the district cooling plants are to be co-located
within selected large-scale developments.
The District Cooling System now comprises two
chilled water production plants which are interconnected
by a piping network (Fig 2).
1
Singapore Power Group is a leading energy utility group with headquarters in
Singapore. It owns and operates electricity and gas transmission and distribution
businesses in Singapore and Australia.
2
Dalkia is the energy division of Veolia Environment, a French utility group in
environmental services. It is a leading provider of energy services across Europe,
North America and Asia.

Plant 1 Piping Network
Marina Bay Sands
Plant 2
Marina Bay
Financial Ctr
Fig 2. Marina Bay District Cooling System
A. District Cooling Plant No 1 (Plant 1)
Plant 1 is located at One Raffles Quay, a premium
office complex completed in 2006 on the site of first land
sale for Marina Bay which was successfully concluded in
2002. The machine room occupies the basement of the
complex and cooling towers sit on the podium roof
between two office towers.
Plant 1 has a design capacity of 157 MWr. Phase 1 of
the plant, with 57MWr production capacity, was
commissioned in May 2006. In October 2009, additional
40MWr production capacity was installed under Phase 2
of the plant. Currently, Plant 1 has an installed capacity of
97MWr comprising the following key equipment:
1 x 3 MWr water chiller;
2 x 7 MWr water chiller;
2 x 10 MWr water chiller;
3 x 10 MWr brine chiller;
3 x ice thermal storage system, each capable of 10MWr
discharge rate; and
18 x 5 MWr cooling tower
B. District Cooling Plant No 2 (Plant 2)
Plant 2 is located under the Bayfront Avenue forming
part of the land site for the new integrated resort
developed by Marina Bay Sands. Plant 2 is designed for
180MWr production capacity. In May 2010, Phase 1 of
the plant was completed with 60MWr installed capacity
comprising the following key equipment:
6 x 10 MWr water chiller; and
4 x 20 MWr cooling towers.
C. Chilled Water Piping Network
Interlinking the two plants is a chilled water piping
network which is installed in the common services
tunnels. The trunk section of network comprises pipes of
1.5m diameter. Branch pipes connect buildings to be
served to the network. The pipes are insulated with
foamglass with outer galvanized steel sheet cladding. As
at May 2010, the network pipes total 5 km in length.
D. Cooling Demand
The contracted supply capacity will amount to 113
2
MWr by end 2010. Cooling demand is projected to grow
rapidly in the next few years as new developments come
on stream in the new business district.
E. Hot Water Supplies
As a “green” initiative and also a business
enhancement, hot water is generated from waste heat in
the condensing water circuit at Plant 2. Heat pumps (4 x
900 kWr) provide hot water source for the hotel and food
establishments in the integrated resort.
IV. COMMERCIAL ARRANGEMENT WITH CUSTOMERS
i) Technical Scheme
Chilled water supply to a customer is provided via heat
exchangers as a connection interface in an Intake Station
(or energy transfer station) located within the customer’s
development. The typical connection scheme is shown in
Fig. 3.
Fig 3 . Typical Intake Station Schematic
The building space for the Intake Station is provided
and maintained by the customer. The Intake Station also
accommodates the downstream pumps for distribution of
chilled water within the development.
The costs of the service connection facilities, which
include the heat exchangers, metering / control equipment
and connection pipes to the Chilled Water Piping
Network, are borne directly by the customer but the
installation and maintenance of the facilities are
undertaken by SDC. SDC bears the costs of upstream
piping network and the district cooling plants as
infrastructure costs which are translated into recurring
monthly Contract Capacity Charges levied on the
customers.
ii) Performance Based Service Agreement
Chilled water supply temperature is regulated at 6.0ºC
+0.5ºC. The customer is required to adopt “variable flow”
design for its downstream reticulation so as to achieve a
return temperature higher than 14ºC. If the hourly average
supply temperature exceeds 6.5ºC, SDC pays a rebate that
is twice the equivalent hourly rate for Contract Capacity
Charge. Similarly, if the monthly average return
temperature falls below 14ºC, the customer pays a
surcharge on the Usage Charge.

iii) Tariffs
The chilled water tariffs are regulated by Energy
Market Authority (EMA) and the tariff rates are reviewed
at half-yearly intervals. There are five components as
follows:-
a) Contract Capacity Charge
This is based on the supply capacity requirement
declared by the customer. The rate is benchmarked to
the fixed costs of operating in-building chiller plants.
The benchmark parameters were established by the
Energy Market Authority through an independent
survey of chiller plants in ten commercial buildings.
b) Usage Charge
The payment is based on metered energy
consumption. The rate is pegged to prevailing prices
for electricity and water which are variable inputs for
chilled water production.
c) Capacity Overrun Charge
This component provides flexibility to a customer to
address his ad-hoc requirement for higher cooling
capacity and allows him to declare his supply
capacity requirement to correspond to his sustainable
demand. The daily rate for Capacity Overrun Charge
is one-tenth of the monthly rate for Contract Capacity
Charge.
d) Return Temperature Adjustment
Low return temperature from customers (commonly
known as “Low Delta-T Syndrome”) degrades the
system performance. It results in additional pumping
in the chilled water supply network. It also renders it
difficult to load chillers to their design capacities,
thereby adversely affecting their energy efficiency.
To encourage good operation and maintenance
practice at customer’s end, there is an upward
adjustment of the Usage Charge by 3% for each
degree C of the monthly average return temperature
below 14ºC.
c) Supply Deficiency Rebate
SDC is committed to high supply quality. A rebate
equivalent to twice the amount for the corresponding
Contract Capacity Charge is paid to the customer
when the average supply temperature for any hourly
interval fails to meet the specifications.
V. REGULATORY FRAMEWORK
District cooling, as an infrastructure system, derives its
economic advantages primarily from its large-scale
operation when compared to in-building chiller plants.
On the other hand, developments subscribing to district
cooling service, as in the case of any other public utilities,
have little flexibility to discontinue the subscription of the
service in future. The concerns about the lack of control
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over the supply quality and pricing of the new utility
service present major impediments for a new district
cooling system to attain the critical mass of demand when
development owners have the option to continue building
their own in-building plants. The authorities in Singapore
accepted the submission for district cooling to be made a
mandated utility service in order to mitigate the start-up
commercial risks. Accordingly, the District Cooling Act
was legislated in 2002 to provide the necessary regulatory
framework.
The legislation, administered by the Energy Market
Authority of Singapore, requires that the new utility
service be priced at a level no higher than the equivalent
costs of chilled water production in conventional in-
building plants employing similar technology. Over time,
the district cooling operator is allowed to earn a baseline
return based on its invested assets. When the operator has
recovered its start-up losses after achieving the critical
mass of demand for efficient operation, any efficiency
gain above the baseline return shall be shared equally by
the operator and customers. Customers are thus assured
of long-term savings and the start-up demand risk for the
operator is also mitigated.
VI. COMPARATIVE ADVANTAGES OF DISTRICT COOLING
Compared to in-building independent chiller plants, a
district cooling system is superior in terms of asset
efficiency, energy efficiency and service level.
A. Asset Efficiency
To ensure service continuity, spare machines are
always needed in in-building plants to cater for
maintenance and equipment failure situations. Often for
consideration of ensuring adequate cooling capacity, the
design engineer may also provide additional design
margin. Comparing the installed capacity to the actual
peak cooling demand, such capacity margin could range
from 50% to 300%. Once installed, the spare capacity is
effectively a stranded asset.
Such asset stranding does not occur for a district
cooling system where the system expansion takes the
actual cooling demand into consideration. Any unused
capacity at any point in time can be used to serve new
developments in due course.
In addition, due to diversity of cooling demand by
different buildings, the system capacity required to
provide supplies to a group of buildings is always lower
than the aggregate capacities that need to be installed for
individual buildings.
There is thus better asset efficiency in chilled water
production facilities through the aggregation of cooling
demand to be served by centralized plants.
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However, a district cooling system necessitates a and professional attention is accorded to its maintenance
piping network. Except for high load density area, the on an on-going basis.
investment in the piping network could erode the asset
efficiency of chilled water production. Table 1 summarises the energy performance of the
district cooling system at Marina Bay.
B. Energy Efficiency
Table 1 : System Energy Efficiency in June 2010
While larger and more efficient machines can be Direct chilled water production 0.71 kWeh per RT-Hr
deployed in a district cooling system, this is not a Ice production 1.03 kWeh per RT-Hr
distinctive advantage. Higher energy efficiency rating can Network pumping 0.04 kWeh per RT-Hr
normally be achieved, even in in-building chiller plants, System overall 0.80 kWeh per RT-Hr
with higher investment.
The System Overall measure is computed on the basis
of electricity input to the district cooling system compared
Upon attaining its critical mass of demand, a district
to the cooling energy sold. With growth in the system
cooling system is inherently more energy efficient than
demand and continued fine-tuning effort for system
independent in-building plants primarily for two major
operations, the energy efficiency is expected to improve
reasons:-
further. Notwithstanding the additional network pumping
- High loading level for machines close to their
and lower conversion efficiency for thermal storage
design capacity; and
system (TES), the current System Overall energy
- Professional attention to operation and
efficiency indicator at 0.80 kWeh per RT-Hr is more
maintenance of the system.
superior to the performance of most in-building chiller
plants in Singapore, for which the average system
As a typical in-building plant has few chillers, there are
efficiency is about 1.0 kWeh per RT-Hr. The energy
practical difficulties to match the capacity of online
efficiency margin is actually higher if an adjustment is
chillers to the actual demand all the time. The cooling
applied to account for the difference in supply temperature
demand of a building varies, inter-alia, with the type of
of the chilled water from the district cooling system
usage, occupancy, time-of-the-day and weather
(6.0ºC) and in-building plants (typically in the range of
conditions. In addition, in order to ensure adequate
6.5-8.0ºC).
cooling capacity, it is not uncommon for the design
engineer to add a design margin to the cooling load
Table 1 shows that generation of cooling energy
assumption which typically already represents the worst-
through an ice TES uses some 40%-45% more electricity
case cooling demand. Many in-building chiller plants also
input than direct chilled water production. Critics of
suffer from the “Low Delta-T” syndrome. Due to all these
district cooling system often cite the deployment of ice
factors, chillers in independent in-building plants typically
TES as out of line with the global effort of reducing
operate at a low loading level most of the time. The
greenhouse gas emission. This is a misguided perception.
energy performance accordingly falls short of the design
intention.
The use of TES effectively shifts some electricity load
to off-peak night hours for cooling demand during the day
As there are many more machines needed to meet the
hours. Incremental electricity generation in the power
aggregate demand of many buildings, the chillers in a
system at off-peak requires less source fuel compared to
district cooling system can be scheduled to run based on
on-peak period when less efficient generators are required
the actual cooling demand in a manner similar to
to come online. In Singapore, the efficiency of power
electricity generation scheduling in a power system.
generation ranges from below 30% for open-cycle gas
Thermal storage facilities in a district cooling system also
turbines to some 38% for steam plants and over 50% for
provide flexibility to delay or avoid the starting of an
combined cycle plants. Hence, from the perspective of
additional chiller when the demand marginally exceeds
source fuel usage, the higher electricity input required by
the aggregate capacity of the online machines. Hence, the
ice TES but at off-peak hours does not necessarily amount
loading level can be maintained high, closer to the design
to more greenhouse gas emission per unit cooling energy
capacity and efficiency of the machines.
produced.
Very often, skilled and experienced professionals are
The benefits for the deployment of ice TES in the
also not available or deployed for operation and
district cooling system at Marina Bay include the
maintenance activities of standalone in-building chiller
following:
plants, leading to degradation in energy efficiency. On the
a) Although the spread between the peak and off-peak
other hand, the operational efficiency of a district cooling
electricity prices is small in Singapore, lower overall
system critically affects the profitability of the utility
per-unit energy cost can still be achieved through
business. The operation of a district cooling system is
higher load factor for electricity input to spread the
closely supervised by more sophisticated control systems
electricity capacity charges and opportunistic reduction
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of electricity supply intake during periods of price
hikes in the wholesale electricity market.
b) The limited roof space available for cooling towers can
be optimally utilized for more cooling output capacity
from the district cooling plants.
c) With TES, the cooling towers, plant infrastructure such
as electrical system and the fewer number of chillers
are worked harder to provide the peak cooling
capacity. This is advantageous from the perspective of
total investment costs.
d) The chilled water supply reliability can be enhanced
with TES, particularly at start-up period of the system.
e) The TES also functions as a regulating source of
chilled water supply to facilitate online chillers
operating at full load for energy efficiency.
There is indeed a need for caution when comparing the
“kW per RT” numbers for chiller plants. While they serve
to provide a general indication, they are not a
comprehensive indicator for evaluating the energy
performance without concurrently taking into
consideration of the technology, locations and operating
conditions of the plants.
C. Higher Service Level
District cooling is a utility service like electricity. It is
superior to chilled water supplies from in-building plants
for these attributes:
- round-the-clock availability;
- well regulated supply temperature;
- supply as-demanded at any quantity within the
contracted capacity; and
- high reliability.
The superior service level is conducive to business
activities in modern business districts.
Chilled water supply from in-building plants is
typically not metered. The metering and invoicing aspect
of district cooling service heightens the awareness of the
users on cooling energy usage, thus leading to greater
conservation effort such as turning off air-conditioning
when it is not needed.
The “Low Delta-T” syndrome, if present in a building
using the district cooling service, is reflected in the
monthly invoice as the Return Temperature Adjustment
for the Usage Charge. This surcharge also helps to alert
the building management of the need for maintenance
attention to the downstream facilities. Proper
commissioning and maintenance of the downstream
facilities will avert excessive flow in the downstream
chilled water system, thereby removing the “Low Delta-T”
syndrome and cutting down wasteful pumping power.
VIII. CONCLUDING REMARKS
A district cooling system creates economic value
through its larger scale of operation. A quick growth in
cooling demand to build a critical mass is essential for its
commercial success. While the justification of its
introduction to low load density areas, such as residential
districts or a sprawling area with low-rise buildings,
would be challenging in terms of economic viability, it is
evidently a desirable utility service for high load density
areas in an urban environment, particularly in the tropics.
The strategic decision of the authorities in Singapore in
fostering the successful implementation of the district
cooling system at Marina Bay has yielded tangible
outcome in elevating the energy efficiency for air-
conditioning of the new business district with greater
certainty and effectiveness.

VII. DEMAND SIDE ENERGY EFFICIENCY

District cooling, with its utility attributes, is an
enabling infrastructure for better energy efficiency at the
utilization level. It helps to avoid these wasteful practices
commonly observed in buildings:
- Proliferation of less energy-efficient split unit air-
conditioners for use at off-peak period when the
in-building chiller plant is not operating.
- Operating additional AHUs than necessary at off-
peak period to provide a minimal load to the
chiller for stable operation.
- Need for warm clothing in a tropical environment.
Often some part of the building is over-cooled
when centralized AHUs serve large floor area. The
round-the-clock availability of chilled water from
district cooling facilitates the adoption of localized
control through the use of smaller AHUs or fan- (Updated: June 2010)
coil units.