Coming in from the Cold

District heating has the potential to make a substantial contribution to a sustainable energy future in Central Europe and the former Soviet Union. It is a critical energy source for countries in transition, covering 60 percent of heating and hot water needs. These systems can do much to save energy and boost energy security, but a stronger policy framework is needed to encourage wise management and investment. With such a framework, district heating systems in formerly Socialist countries could save the equivalent of 80 billion cubic meters of natural gas a year through supply-side efficiency improvements. This is greater than total annual natural gas consumption in Italy.  Reforming district heating is also essential for social reasons in cold countries in transition. Coming out of the Cold provides a road map of options to help policymakers sort through key district heating issues. Countries need to have a clear policy toward district heating given the significant economic, social and environmental implications of this sector. This is true for IEA member and non-member countries alike. Policy does make a difference. Clear, coherent policy can have a very positive impact on improving heat supply.