This article presents an initial design methodology of the water/steam cycle of combined-cycle power plants. From prescribed boundary conditions such as the GT type or ambient conditions, the water/steam cycle process model performs a computation and initial design of all key components, leading to cycle performance and cost. Particular focus is given here to the Heat Recovery Steam Generator (HRSG), a key component for heat integration having a large impact on both plant cost and performance. With the assistance of an optimization toolbox, optimal designs are found with respect to cost and performance. The process model allows a number of water/steam cycle configurations. Features include the number of pressure levels, the choice of single or double reheat, options for supplementary firing in the HRSG, heat integration with GT coolers, fuel gas preheating and steam extraction from the steam turbine. From prescribed thermodynamic inputs, the model computes and/or selects key components and systems from the Original Equipment Manufacturer (OEM) portfolio: HRSG, piping, steam turbine, condenser and generator. For each key component and system, the performance and cost are derived. The initial design of the HRSG fully integrates all interfaces and is supported by a sub-optimization step, which provides proper surfacing and sequencing of heat exchanger components with the target of minimizing cost. To achieve the required accuracy, the HRSG is first designed technically in detail, namely dimensioning and material selection of finned tubes, structural steel, casing and insulation. The resulting partial bill of quantities is then converted into cost, applying appropriate material rates. This approach guarantees full sensitivity of the model to mass flow, pressure or temperature changes at any location in the HRSG. Coupled to this process model, the multi-objective optimization toolbox allows identifying the pareto front for plant net performance and plant cost, clearly two conflicting objectives. In the example application of a KA26–1 combined-cycle power plant, steps are identified on the pareto front, which can be associated with the number of HRSG modules. For selected project economic conditions and plant operation profile, the pareto front can be post-processed to identify the design with minimum COE or maximum project NPV. Simultaneous optimization of the complete cycle ensures the best possible integration of all key components. Flexibility, speed and effectiveness of the methodology allow exploring many cycle variants, maximizing the chances of finding the global plant optimum in less time. Having been thoroughly validated, the initial design methodology is applicable for development of standard plants as well as integration of specific customer requirements.