An important component for a renewable and sustainable heat energy supply is the consideration of urban quarters. For this purpose, the locally available energy sources, a local energy generation system, and the energy distribution in urban quarters should be considered. In the IWAES project presented here, a bidirectional low-temperature heat network was developed, thus it falls into the category of fifth-generation heat networks. It also makes use of existing urban water management infrastructure. The innovative concept is based on the approach of modifying sewers so that they can transport thermal energy between users in the same quarter and extract thermal energy from wastewater. The overall goal is to generate thermal energy and balance the different thermal needs. This is particularly useful in mixed-use quarters, as the peak loads of different uses occur at different times. The supply concept also envisages integrating other thermal energy sources available in the quarter as well as storage options into the supply concept. As a framework for the technical aspects, a precise urban planning concept is needed that provides the legal framework for land use and urban development and coordinates and implements the developed concept—through so-called energy master planning. A life cycle assessment shows the ecological impact of the developed concept compared to a conventional energy solution. It also shows the savings potential of the developed concept compared to an urban quarter supplied conventionally with heating and de-centrally with cooling. The assessment outlines the dual use of the pre-existing infrastructure, such as the wastewater system, significantly reduces CO2 equivalents. Another result is that the sustainability of the system depends significantly on the used mix of electric sources.