Mankind is facing an escalating threat of global warming and there is increasing evidence that this is due to human activity and increased emissions of carbon dioxide. Converting from vapour compression chillers to absorption chillers in a combined heat and power (CHP) system is a measure towards sustainability as electricity consumption is replaced with electricity generation. This electricity produced in Swedish CHP-system will substitute marginally produced electricity and as result lower global emissions of carbon dioxide. The use of absorption chillers is limited in Sweden but the conditions are in fact most favourable. Rising demand of cooling and increasing electricity prices in combination with a surplus of heat during the summer in CHP system makes heat driven cooling extremely interesting in Sweden. In this paper we analyse the most cost-effective technology for cooling by comparing vapour compression chillers with heat driven absorption cooling for a local energy utility with a district cooling network and for industries in a Swedish municipality with CHP. Whilst this case is necessarily local in scope, the results have global relevance showing that when considering higher European electricity prices, and when natural gas is introduced, absorption cooling is the most cost-effective solution for both industries and for the energy supplier. This will result in a resource effective energy system with a possibility to reduce global emissions Of CO2 with 80%, a 300% lower system cost, and a 170% reduction of the cost of producing cooling due to revenues from electricity production. The results also show that, with these prerequisites, a decrease in COP of the absorption chillers will not have a negative impact on the cost-effectiveness of the system, due to increased electricity production. (C) 2006 Elsevier Ltd. All rights reserved.