It is becoming more important to realize CO2-capturing power generation systems (PGSs) for drastically decreasing an amount of CO2 emission into the atmosphere. However, net power generation efficiency (NPGE) of a CO2-capturing system has been considered to be greatly deteriorated, since capturing CO2 requires extra energy. This paper proposes a new CO2-capturing PGS that has a high-efficient NPGE by utilizing waste heat from factories. As an example of a waste heat, exhaust gas with temperature 200 degrees C from refuse incinerator plants is adopted. In the proposed system, the temperature of saturated steam produced by utilizing the waste heat is raised by combusting fuel with the use of pure oxygen in a combustor, and is used as the main working fluid of a gas turbine PGS. It is estimated that the proposed system has a fuel-to-electricity NPGE of 59.3%, when turbine inlet temperature (TIT) is assumed to be 1000 degrees C. The economics of the proposed system is also evaluated and the CO2 reduction cost is estimated to be small; 4.16 U.S. $ t(-1) CO2 compared with 32.1 U.S. $ t(-1) CO2 for a conventional steam turbine PGS. It is shown that CO2-capturing is not cost consuming but becomes to be profitable owing to improved power generation characteristics, when its TIT is increased from 1000 to 1200 degrees C. Copyright (c) 2009 John Wiley & Sons, Ltd.