The purpose of the paper is to investigate the challenges in modelling the energy losses of heating networks and to analyse the factors that influence them. The verification of the simulation was conducted on a test stand in-situ and based on the measurements of the testing station, a database for the final version of the numerical model was developed and a series of simulations were performed. Examples of the calculated results are shown in the graphs. The paper presents an innovative method of identify the energy losses of underground heating network pipelines and quantify the temperature distribution around them, in transient working conditions. The presented method makes use of numerical models and measured data of actual objects. The dimensions of the pipelines used were 6 m wide, 8 m high and 1 m in depth, while they were simulated under conditions of zero heat flow in the ground, in the perpendicular to the sides direction of the calculated area and considering the effects of ground's thermal conductivity. The mesh was developed using advanced functions, which resulted its high quality with the average orthogonal quality of 0.99 (close to 1.00) and Skewness of 0.05 (between 0.00 and 0.25). To achieve better accuracy of the simulation model, the initial conditions were determined based on the numerical results of a three-dimensional analysis of heat losses, in steady state conditions in a single moment. The validation process confirmed the high quality of the model, as the differences between the ground temperatures were approximately 0.1 degrees C. (C) 2015 Elsevier Ltd. All rights reserved.