Driving Croatia’s District Heating Transformation – The LIFE D2Heat Success Story

Croatia’s district heating (DH) systems play a crucial role in achieving national decarbonisation targets but face significant challenges due to outdated infrastructure and inefficiency. The LIFE PDA D2Heat project, led by the North-West Croatia Regional Energy and Climate Agency (REGEA) in collaboration with Croatia’s leading DH operators, is driving a transformation of the sector. Representing more than 97% of the DH market, the project is modernising networks and integrating renewable energy through the D2Heat Support Facility, launched in November 2022.

By offering technical and financial expertise, this initiative is not only increasing energy efficiency but also accelerating the adoption of clean energy solutions and reducing greenhouse gas emissions.

Croatia DH Today

Rather than implementing isolated renovations, D2Heat takes a holistic approach, aggregating investment projects to maximise impact. The current state of Croatia’s DH sector, represented by the four key operators, includes:

✔ 1,200 MW of total installed thermal capacity

✔ 1,960 GWh of total heat energy delivered

✔ More than 430 km of DH network infrastructure

✔ 150,000 end users

Croatia DH Tomorrow

The D2Heat Support Facility has identified a pipeline of over 20 large-scale projects with a total value of approximately €120 million. These projects include large wastewater heat pumps powered directly by solar power plants, network modernisation, and solar-thermal solutions. They will be supported by technical and financial advisory services from D2Heat, with the investment cycle expected to peak in 2026. In addition to the large-scale project pipeline, the D2Heat Support Facility has facilitated smaller-scale investments with a combined procurement value of around €10 million, which are currently being implemented.

The D2Heat Support Facility is the backbone of this transformation, offering expertise in technical documentation preparation, procurement models, and policy advocacy.

Replicability and Sustainability

Beyond Croatia, D2Heat sets a benchmark for replication across the EU. By integrating technical, financial, and policy innovations, it offers a scalable model for DH modernisation in other regions facing similar challenges.

With its system-wide approach and strategic investment pipeline, D2Heat is not just transforming Croatia’s DH sector—it is shaping the future of sustainable district heating in Europe.

The project aims to achieve:

✔ Initiation of at least €40 million in investments by the end of 2026.

✔ Implementation of measures focused on decarbonisation through renewable energy sources (RES), with clear targets for 2035 (minimum 80% RES) and 2050 (100% RES).

✔ Utilisation of advanced financing models, such as green bonds and power purchase agreements (PPAs).

✔ Securing €80 million in targeted grant funding for DH operators through the Modernisation Fund.

This best practice is extracted from our publication ‘Sustainable Regions in Action‘. Discover more best practices here!