District energy (DE) systems provide an important means of mitigating greenhouse gas emissions and the significant related concerns associated with global climate change. DE systems can use fossil fuels, renewable energy and waste heat as energy sources, and facilitate intelligent integration of energy systems. In this study, an enviro-economic function is developed for assessing various energy sources for a district energy system. The DE system is assessed for the considered energy resources by considering two main factors: CO2 emissions and economics. Using renewable energy resources and associated technologies as the energy suppliers for a DE system yields environmental benefits which can lead to financial advantages through such instruments as tax breaks; while fossil fuels are increasingly penalized by a carbon tax. Considering these factors as well as the financial value of the technology, an analysis approach is developed for energy suppliers of the DE system. In addition, the proposed approach is modified for the case when thermal energy storage is integrated into a DE system. Crown Copyright (C) 2014 Published by Elsevier Ltd. All rights reserved.