This paper presents an optimal production and distribution management for structural and operational optimization of the integrated district heating system (DHS) with multiple regional branches. A DHS consists of energy suppliers and consumers, district heating pipelines network and heat storage facilities in the covered region. In the optimal management system, production of heat and elec-tric power, regional heat demand, electric power bidding and sales, transport and storage of heat at each regional DHS are taken into account. The optimal man-agement system is formulated as a mixed integer linear programming (MILP) where the objectives is to minimize the overall cost of the integrated DHS while satisfying the operation constraints of heat units and networks as well as fulfilling heating demands from consumers. Piecewise linear formulation of the production cost function and stairwise formulation of the start-up cost function are used to compute nonlinear cost function approximately. Evaluation of the total overall cost is based on weekly operations at each district heat branches. Numerical simu-lations show the increase of energy efficiency due to the introduction of the pre-sent optimal management system.
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