District heating and local heating are two central supply concepts for a climate-friendly heat supply. But what are the differences - technically, economically, and structurally? Which solution is best suited to different types of infrastructure and settlement layouts? What requirements must a heating network meet, and what political framework conditions need to be considered?
This blog post outlines the key differences between local heating and district heating. It clearly explains central topics such as heating networks, supply concepts, and temperature ranges, and highlights the technical, economic, and legal factors that determine the future viability of modern heating systems.
The contents:
The most important difference between district heating and local heating
District Heating relies on central heating networks with high temperatures, long pipe lengths, and industrial heat sources such as combined heat and power, waste incineration, or deep geothermal energy. Local heating, on the other hand, is decentralised, using short pipe networks, lower flow temperatures, and locally available energy sources such as biomass, solar thermal energy, or near-surface geothermal energy.
Both systems support the decarbonisation of heat supply but differ in network structure, efficiency, CO₂ balance, eligibility, and regulatory requirements.
District heating – also known as district energy – refers to the central supply of entire cities or districts with space heating and hot water. But what makes this system so important for the heating transition in densely populated regions?
At its core, district heating follows a simple principle: heat is generated in large, central plants – such as combined heat and power plants, waste incineration facilities, industrial waste heat sources or increasingly renewable sources like geothermal and solar thermal energy. This heat is then transported to connected buildings via an extensive underground pipeline network. The transfer medium is usually hot water, flowing through insulated pipes at temperatures of 80 to 120 °C.
District heating networks have a hierarchical structure: central main lines transport the generated heat to different districts, where transfer stations feed the energy into each building’s heating system. Depending on the region, the size and range vary considerably – from compact systems to extensive networks stretching several thousand kilometres.
In Scandinavia and Central Europe, district heating is a key part of urban infrastructure and is politically promoted. Advantages such as high supply reliability, low maintenance requirements, and significant potential for CO₂ reduction make district heating an important component of sustainable heat supply worldwide.
What does a sustainable heat supply look like when large-scale district heating networks aren’t feasible? One answer is the concept of local heating (LH). Local heating supplies smaller units - for example, a cluster of hotels and offices, a residential district, or a small municipality - all sharing a central heat source.
The basic technical principle of local heating is similar to that of district heating. However, as the name suggests, it is designed for much shorter distances and smaller networks. A central heating system - often initiated and operated by the building owners themselves - generates the required heat, which is then distributed to connected consumers via a branched, thermally insulated piping system.
Typical networks are less than five kilometres in length and usually serve fewer than ten buildings, though the boundaries between local and district heating can be fluid.
Local heating networks use a wide range of heat sources, from combined heat and power plants and biomass plants to heat pumps and solar thermal energy. Particularly relevant is the use of near-surface geothermal energy, which enables a stable, low-emission supply over short distances. Thanks to low grid temperatures, between 50 and 80 °C, renewable energies can be integrated efficiently, and heat losses can be significantly reduced.
The difference between district heating and local heating are evident in their structure, technology, energy source, network size, and economic planning. District heating is designed for large-scale, centralised systems with a high connection density, while local heating offers decentralised, flexible solutions for smaller supply areas. Both types of heating networks play a key role in the heating transition, but they differ fundamentally in terms of structure, temperature range, cost-effectiveness, and technical implementation.
District heating networks typically serve entire cities or large districts via centrally controlled pipeline networks ranging from five to over twenty kilometres in length. Their structure is designed for thousands of buildings and follows a hierarchical layout with main lines and distribution lines.
Local heating networks, on the other hand, usually connect smaller units – such as neighbourhoods, municipalities or building complexes – within a radius of less than five kilometres. This compact structure reduces heat losses and allows for a high degree of adaptability to local conditions.
Another technical difference between local heating and district heating lies in the operating temperature level. District heating typically works with flow temperatures between 80 and 120 °C, which are well-suited for conventional radiators and domestic hot water production. Local heating, by contrast, operates at lower temperatures, generally between 50 and 80 °C. This enables the efficient integration of renewable energy sources such as heat pumps or solar thermal systems, while also reducing energy losses in the network. Increasingly, so-called cold local heating networks, operating at temperatures below 30 °C, are being deployed in combination with decentralised heat pumps.
District heating is primarily based on large-scale central plants, such as combined heat and power, industrial waste heat, waste incineration, or deep geothermal energy. These systems feed the energy generated into a supra-regional heating network.
Local heating, by contrast, relies on decentralised, renewable-oriented heat sources, including biomass, biogas, near-surface geothermal energy, solar thermal energy, or small combined heat and power plants. This diversity allows for a flexible supply and promotes the use of local energy potential.
The profitability of district heating depends heavily on connection density and a long-term investment horizon. These projects are often capital-intensive but benefit from stable regulations and funding mechanisms. Operators are typically municipal utilities or large energy suppliers.
Local heating projects, on the other hand, are smaller, can be implemented more quickly, and are economically viable even with a small number of connections – for example, in new development areas or rural areas. The operator structure is more diverse: in addition to municipalities, cooperatives, housing companies, or private owners can act as sponsors. Approval procedures are often simplified, and pricing can be more flexible.
District heating is centrally organised and provides a high level of operational reliability, but offers less flexibility for network expansion. Local heating scores with decentralised control and modular expandability – making it ideal for dynamic district developments or the gradual transformation of existing settlements.
Both systems can be integrated with digital controls, sector coupling, and intelligent load management, which are key components of a future-proof heat supply.
|
Feature |
District Heating |
Local Heating |
|
Coverage area |
Cities, urban agglomerations |
Neighbourhoods, communities |
|
Typical heat sources |
Industrial waste heat, waste incineration, combined heat and power, deep geothermal energy |
Biomass, solar thermal energy, biogas, near-surface geothermal energy |
|
Net length |
> 5 km, often up to 20 km or more |
< 5 km, mostly a few kilometres |
|
Temperature range |
80–120 °C |
50–80 °C |
|
Mesh size |
Large-scale, branched networks with thousands of connections |
Small, manageable networks with a few to a few dozen buildings |
|
Economy |
Profitable with high connection density |
Flexible, possible even at lower density |
|
Control & Flexibility |
Centralised, less flexible |
Decentralised, dynamically expandable |
|
Typical operators |
Energy suppliers, municipal utilities |
Building owners, cooperatives |
Which solutions work in practice, and what lessons can other regions take from them? A look at successful district heating and local heating projects worldwide shows that different framework conditions call for different technologies, but recurring success factors can be identified.
In Scandinavia, district heating is a central element of energy policy. In cities such as Copenhagen, Stockholm, and Helsinki, dense networks supply entire cities, fed by biomass, waste heat, solar thermal energy, or deep geothermal energy. These systems are digitised, modular, and highly integrated. For example, Denmark combines large-scale heat pumps, waste heat, and solar panels to enable CO₂-free district heating. The supply is reliable, scalable, and firmly anchored in policy.
In Germany and Switzerland, local heating networks are gaining importance. Especially in rural areas and new housing developments, solutions based on geothermal energy, wood-fired heating plants, or cold networks are being implemented. Many projects are supported by energy cooperatives or municipalities, enjoying high public acceptance and short implementation times.
China is pursuing a different strategy. Through the "Clean Winter Heating" programme, the country is modernising large-scale district heating systems, replacing coal with combined heat and power, waste heat, or renewable energy sources. In cities such as Tianjin or Shijiazhuang, district heating networks are being developed on an industrial scale, often supported by state subsidies and implemented at high speed.
Momentum is also picking up in North America. Cities such as Bellingham, Washington, are developing low-carbon district heating networks that combine industrial waste heat with renewable energy sources. The focus is on supply security, grid resilience, and reducing the burden on electrical infrastructure.
The differences between district heating and local heating are not only evident in the network structure, temperature range, and energy sources, but also in the technical requirements for the piping system. To operate sustainable heating networks economically, the infrastructure must be efficient, durable, and adaptable. Polypropylene pipe systems (PP pipes), such as aquatherm energy meet these requirements in both district and local heating networks – for house connections, distribution lines, or as a complete solution for district supply.
PP pipe systems offer significant advantages in the implementation of heating networks – both in planning and operation
In district heating networks, PP pipes are mainly used for house connections and distribution networks. In local heating networks, PP pipe systems can cover the entire pipe system. They are particularly suitable for flow temperatures between 50 and 80 °C. Even in cold local heating networks with lower temperatures, PP pipelines can be used safely and efficiently. This makes them a practical and efficient solution for decentralised heat supply.
District heating is ideally suited for large-scale use in cities and urban areas. Large-scale district heating networks provide excellent conditions for integrating new technologies on an industrial scale. In Europe and Asia, large heat pumps, deep geothermal energy, and solar thermal energy are increasingly being incorporated into existing district heating infrastructures. Countries such as Denmark and the Netherlands are also experimenting with the admixture of hydrogen to further accelerate decarbonisation. Digital control and sector coupling – for example with the electricity and mobility sectors – are already a reality in urban district heating systems, enabling flexible and intelligent energy use.
In contrast, local heating is often organised in a decentralised manner. Local heating networks serve as innovation laboratories for the energy transition. Their decentralised structure allows new technologies, such as cold local heating networks, near-surface geothermal energy, or district batteries, to be implemented quickly and with minimal risk. In Switzerland and Germany, numerous pilot projects are exploring combinations of heat pumps, solar thermal energy, and smart control systems.
Technical concepts alone are not enough. The successful implementation, scaling, and long-term operation of local and district heating networks depend largely on political frameworks and financial incentives. Subsidies, regulatory clarity, and legal requirements are key catalysts for any successful heating strategy – whether for local heating projects in a district or large-scale district heating infrastructures. Many countries have long recognised the role that state funding must play:
There are also major differences in regulation. In Denmark, laws such as the “Heat Supply Act” ensure a clear division of responsibilities between grid operators and municipalities. Connection and usage obligations increase planning and connection density – particularly relevant for large-scale district heating. In the UK, a national regulatory authority for heating networks will be introduced in 2025. The goal: greater consumer protection, price stability, and transparency – for both district and local heating.
For project managers, this means that without detailed knowledge of national, regional, or even local funding opportunities and regulatory frameworks, sound planning is impossible, especially given the differences between local and district heating in terms of structure, technology, and responsibilities.
Knowing the “rules of the game” at an early stage allows projects to strategically secure financing, approvals, and implementation, turning a vision into an economically viable heating concept.
The decision between district heating and local heating is more complex than ever and highly context-dependent. There is no universal recommendation, as the optimal solution depends on numerous factors: settlement structure, political framework, availability of renewable energies, economic conditions, and – last but not least – the technical possibilities on site.
The quality and future viability of the piping systems – especially modern, corrosion-resistant solutions such as PP pipe systems – significantly influence the efficiency, sustainability, and cost-effectiveness of heating networks.
Whether district heating or local heating, both systems are central components of the global energy transition. The best solution is always the one consistently aligned with local conditions, political frameworks, and long-term sustainability. Decision-makers who carefully consider these factors and rely on innovative, flexible infrastructures lay the foundation for a future-proof, climate-friendly heat supply..
Are you planning a heating network? Now is the perfect time to set the right course – technologically, economically, and regulatorily. Benefit from our experience with international pipe projects to make your infrastructure future-proof. We advise you on how to optimise efficiency, scalability, and investment security.
