In this paper, performance of three types of district heating/cooling and hot water supply system with natural and unused energy utilization were examined by using system simulation. An area zoned for both commercial and residential buildings was chosen for this study. The first system is the conventional system in which an electric driven turbo chiller and a gas-fired boiler are installed as the heat source. This is considered as the reference system. Two alternative systems utilize waste heat from space cooling and heating. One is designed based on short-term heat recovery and the other employs the concept of an annual cycle energy system (i.e, seasonal heat recovery). All of the three systems use solar thermal energy for hot water supply to the residential zone. The index for evaluation is the coefficient of performance of the overall system, based on primary energy. As a result. it was found that the seasonal storage system could decrease the energy consumption by about 26% and the short-term heat recovery system co;ld decrease it by about 16% compared with the reference system. In designing the heat recovery system, a balance of cooling/heating demand is an important factor. Therefore a sensitivity analysis of performance of the overall system and the seasonal thermal storage for several load patterns was performed. From these results, it was found that if the amount of heating/cooling demand were well balanced, an improvement of energy performance could be achieved and the utilization factor of the seasonal tank would become higher. Furthermore, the volume of the seasonal storage tank could be reduced. (C) 2000 Elsevier Science Ltd. All rights reserved.