Under the Kyoto Protocol, Japan was supposed to reduce six percent of the green house gas (GHG) emission in 2012. However, until the year 2010, the statistics suggested that the GHG emission increased 4.2%. What is more challenge is, after Fukushima crisis, without the nuclear energy, Japan may produce about 15 percent more GHG emissions than 1990 in this fiscal year. It still has to struggle to meet the target set by Kyoto Protocol. The demonstration area of "smart community" suggests Japanese exploration for new low carbon strategies. The study proposed a demand side response energy system, a dynamic tree-like hierarchical model for smart community. The model not only conveyed the concept of smart grid, but also built up a smart heat energy supply chain by offline heat transport system. Further, this model promoted a collaborative energy utilization mode between the industrial sector and the civil sector. In addition, the research chose the smart community in Kitakyushu as case study and executed the model. The simulation and the analysis of the model not only evaluate the environmental effect of different technologies but also suggest that the smart community in Japan has the potential but not easy to achieve the target, cut down 50% of the CO 2 emission.