The aim of the paper is to identify the optimal energy production system and its optimal operation strategy required to satisfy the energy demand of a set of users in an industrial area. A distributed energy supply system is made up of a district heating network, a solar thermal plant with long term heat storage, a set of Combined Heat and Power units and conventional components also, such as boilers and compression chillers. In this way the required heat can be produced by solar thermal modules, by natural gas cogenerators, or by conventional boilers. The decision variable set of the optimization procedure includes the sizes of various components, the solar field extension and the thermal energy recovered in the heat storage, while additional binary decision variables describe the existence/absence of each considered component and its on/off operation status. The optimization algorithm is based on a Mixed Integer Linear Programming (MILP) model that minimizes the total annual cost for owning, maintaining and operating the whole energy supply system. It allows to calculate both the economic and the environmental benefits of the solar thermal plant, cooperating with the cogeneration units, as well as the share of the thermal demand covered by renewable energy, in the optimal solutions. The results obtained analyzing different system configurations show that the minimum value of the average useful heat costs is achieved when cogenerators, district heating network, solar field and heat storage are all included in the energy supply system and optimized consistently. Thus, the integrated solution turns out to be the best from both the economic and environmental points of view. (C) 2014 Published by Elsevier Ltd.