The extensive energy use in the European building sector creates opportunities for implementing energy conservation measures (ECMs) in residential buildings. If ECM are implemented in buildings that are connected to a district heating (DH) system, the operation of DH plants may be affected, which in turn may change both revenue and electricity production in cogeneration plants. In this study a local energy system, containing a DH supplier and its customer, has been analysed when implementing three ECMs: heat load control, attic insulation and electricity savings. This study is unique since it analyses economic and CO 2 impacts of the ECMs in both a user and a supplier perspective in combination with a deregulated European electricity market. Results show that for the local energy system electricity savings should be prioritised over a reduction in DH use, both from an economic and a global CO 2 perspective. For the DH supplier attic insulation demonstrates unprofitable results, even though this measure affects the expensive peak load boilers most. Heat load control is however financially beneficial for both the DH supplier and the residences. Furthermore, the relation between the fixed and variable DH costs is highlighted as a key factor for the profitability of the ECMs.

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