Global. Reliable. Sustainable.

How It Works

District energy systems are a highly efficient way to heat and cool many buildings in a given locale from a central plant. They use a network of underground pipes to pump steam, hot water, and/or chilled water to multiple buildings in an area such as a downtown district, college or hospital campus, airport, or military base. Providing heating and cooling from a central plant usually requires less fuel and displaces the need to install separate space heating and cooling and hot water systems in each building. The district energy system does the work, providing valuable benefits including:

  • Improved energy efficiency 
  • Enhanced environmental protection
  • Fuel flexibility 
  • Ease of operation and maintenance 
  • Unsurpassed reliability 
  • Comfort and convenience for customers 
  • Decreased life-cycle costs 
  • Decreased building capital costs 
  • Enhanced architectural design flexibility

The sources of thermal energy distributed by district energy systems vary. Some district energy systems are connected to combined heat and power (CHP) plants. Also known as cogeneration plants, CHP plants generate electric power in addition to heating and cooling, and can achieve energy efficiencies above 80 percent. This is far more efficient than a conventional power plant, which exhausts two‐thirds of the energy content of its fuel as heat into oceans, rivers and/or the atmosphere.

Other sources of thermal energy include “waste heat" from incinerators, industrial processes, coal‐ or gas‐fired boilers, and renewable energy such as geothermal, deep lake-water cooling, solar thermal, biogas, municipal solid waste and biomass.

District energy systems that were built on college campuses and in central cities many decades ago were usually powered by fossil fuels. The majority of district energy systems being built today run on natural gas, but many take advantage of locally‐sourced renewable fuels.

According to the International District Energy Association (IDEA), more than 5,000 district energy systems are currently operating in the United States. Canada has approximately 150 district systems from Vancouver to Halifax. But there are many more locations where district energy would be advantageous, and hundreds of existing systems with expansion potential.

District energy helps communities reduce their operating costs and keeps more energy dollars in the community by reducing their need to import fuel. Environmental impacts from heating and cooling are significantly reduced because of the greatly improved efficiency of these systems. Developing district energy/CHP systems can help ease the transition of the power sector as older, polluting coal plants are shut down and removed from the grid. District cooling can cut peak electrical demand that typically occurs in the late afternoon – reducing strain on the grid and avoiding expensive peak power costs. 

See how it works in this brief animation:

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