This paper addresses the simultaneous management of energy and water. A new systematic methodology has been developed for targeting and design that simultaneously minimises the requirements of energy and water. Using this new approach, the design of a water system for maximum energy recovery can be achieved, taking into account the mixing opportunities offered by water networks, while maintaining the water quality to processes in terms of contamination. Direct and indirect energy recovery are analysed and a strategy developed to decrease the number of heat transfer units based on the generation of separate systems and non-isothermal stream mixing. Initially, the analysis is restricted to no water re-use. (c) 2005 Elsevier Ltd. All rights reserved.