The oldest known district heating system actually dates back to the 1300s in the French village of Chaudes-Aigues Cantal, where townsfolk devised a method of distributing warm water through wooden pipes. But the first commercial district heating system was created by Birdsill Holly in Lockport, New York, in 1877. Holly used a boiler as his central heat source and built a loop of steam pipes, radiators and condensate return lines. Starting with fourteen customers, within three years his system served several factories and residential customers and had grown into a three-mile loop.
By the 1880s, district energy systems served a number of U.S. cities, including New York, Boston, Detroit, Philadelphia and Baltimore. Those cities often relied on centralized steam generation for electricity production. This enabled operators to boost profitability by offering both electricity and steam for heating, a process known as combined heat and power (CHP).
Today, district energy is the preferred method of heating and cooling buildings, especially in Europe, North America and the Middle East. Canada’s first district energy system was built in London, Ontario in 1880 to serve its university, hospital and government complexes. The University of Toronto launched a district heating system in 1911, while Canada's first commercial district heating system was established in 1924 in Winnipeg's commercial core.