Characteristics of high‐efficiency gas turbine cogeneration systems using low Btu gas (LBG) are first analysed. Raising the turbine inlet temperature and incorporating a regenerator are both investigated as methods to improve the efficiency of the cogeneration system (CGS). Taking a gas obtained by pyrolyzing municipal refuse as an example of an LBG, various thermodynamic characteristics of the CGS are analysed using a simulation model developed by the authors. Secondly, authors investigate the economics of a CGS for district heating and cooling using the pyrolysis gas, making use of the estimated characteristics. It is shown that the CGS is estimated to be economically feasible, whereas a CGS using conventional high Btu fuel gas (methane gas) is estimated to be economically infeasible under assumed conditions. The impacts of changes in various parameters which determine the economics of the CGS are also investigated, and it is shown that the economics of the system using refuse‐recovered LBG can be expected to be further improved owing to future developments in the technology of generating and refining pyrolysis gas.