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Starting district cooling in existing cities and developments

District cooling is a system in which chilled water (typically at 4 to 7 degree Celsius) is distributed in pipes (usually underground) from a central cooling plant to several buildings for space cooling and process cooling. By replacing individual cooling systems in each building, the district cooling system can deliver economies of scale in terms of capital, energy and maintenance costs. 

This Solution supports local governments in planning for and implementing district cooling networks in existing developments where circumstances such as high cooling demand, mixed-use and existence of buildings with central water-based cooling systems that are reaching the end of their useful life may render it viable.

The local governments’ roles to advance district energy systems within their jurisdiction include: acting as role model by contributing to the demonstration of the viability of district energy, policy, planning, regulation, stakeholder engagement and coordination for systems-integration across urban utilities and for matchmaking between waste heat supply and demand.


HOFOR District Cooling – the district cooling system in the City of Copenhagen is supplied by free cooling from the sea

Motivation / Relevance

In Dubai cooling represents 70% of electricity consumption [1]. In Mumbai, where an estimated 40 per cent of the city’s electricity demand is used for cooling, only 16 per cent of commercial and residential buildings currently use air conditioning (Tembhekar, 2009) [1] suggesting a very high potential for increased demand. The energy requirement for air conditioning is expected to grow at an average of 7% annually until the year 2050 in developing countries [2].

Malaysia is pioneering district cooling systems to tackle rising electricity demand for air conditioning, which already accounts for 30–50 per cent of buildings energy demand nationwide. The city of Cyberjaya implemented district cooling in 1998. The primary goals were to reduce the capital costs of separately installed individual chillers, to lower operating costs and to demonstrate viability. It is estimated that 60 per cent of a regular office’s utility bill goes to air conditioning alone, and rising up to 80 percent if the cooling needs of data centers are factored in. Annual cost savings through district cooling are 39 per cent compared to stand-alone systems (ADB, 2013) [1].

District cooling has huge potential in both developed and developing countries. In Kuwait City, for example, air-conditioning demand accounts for 70 per cent of peak power demand and over 50 per cent of annual energy consumption. District cooling could reduce peak power demand by 46 per cent and annual electricity consumption by 44 per cent compared to a conventional air-cooled systems (Ben- Nakhi, 2011) [1].

The benefits of district cooling are felt by various stakeholders:

  • Consumers benefit from lower and/or more stable cooling costs (if the system is well placed) and from not having to house and maintain individual cooling solutions.
  • Real estate developers benefit from reduced maintenance, reduced space requirement resulting in additional real estate value, etc.

  • Municipal, regional or national electricity utilities are able to provide less electricity at peak demand and overall, reducing the need for transmission system upgrades and capacity additions and operational costs. For example, Toronto’s district cooling system uses the potable water pipeline to extract “free cooling” from deep in Lake Ontario, reducing the cost of cooling by 87 per cent [1].

  • The local economy could potentially benefit greatly from fewer blackouts, reduced need for backup generation in individual buildings, lower electricity prices, and cheaper and easier reduction in use of refrigerants such as HCFCs and HFCs in traditional air conditioning units [1].

Main impacts

  • Air quality improvement and associated public health impacts
  • More reliable energy supply
  • Energy security / Reduced dependence on energy imports
  • Reduced socio-economic impacts of fossil fuels’ price volatility
  • Reduced fuel poverty
  • Local wealth retention and economic development
  • ”Future-proofed” network (allows easy adoption of renewable energy and new technologies without the need to install equipment in each building)
  • Green local economy
  • Resilience to natural and technological disasters and catastrophes
  • Climate change mitigation   

Benefits and Co-Benefits

  • Lower strain on the power grid and reduce black-outs
  • Reduce electricity peak demand
  • Postponing of the need to investment in additional capacity of the power grid to satisfy peak demand and reducing energy generation operational costs
  • Decreased heat loss into the atmosphere, minimizing the urban heat-island effect
  • Contribution to meeting GHG reduction targets, by reducing direct and indirect emissions


This Solution was jointly developed and peer-reviewed by ICLEI and the Global District Energy in Cities Initiative (DES Initiative) , which is coordinated by the United Nations Environment.

ICLEI acknowledges and recognizes all individual organizations and experts that kindly contributed their time and expertise to this Solution - for details please see the "Developer" section above and the "Supporters" webpage.

This Solution draws significantly upon the UN Environment publication: District Energy in Cities. For more information on the Global District Energy in Cities Initiative (DES Initiative) and to become a partner or learning city, please visit: www.districtenergyinitiative.org.

This initiative is the implementing mechanism for the SEforALL District Energy Accelerator.