In a heat network, water is used as the heat transfer medium, which is transported to the end user through an underground pipe system. The heat network functions as a closed circuit. Similar to an internal heating circuit, it has a flow and a return flow. From an external heat producer, the water is directed to the consumer and then pumped back to the heat producer for reheating. A transfer station ensures the right temperature in the house, which is controlled depending on the outside temperature. In summer, some heat networks can also be used to cool buildings.

The construction of a heat network is very complex and expensive, but can be profitable under various conditions. Dense development and a sufficient number of connected buildings, as well as long contract periods with the end consumers make such a project more worthwhile.

When heat networks are built by energy communities which then draw up the contracts to the heat producers as a collective, they have a good influence on the determination of prices and contract duration. This separation of the network owner from the energy supplier makes the network particularly interesting for consumers in terms of price.

Decisive for the efficiency of a heat network are the energy losses during transport to the consumer, as the water is led through a pipe system in the ground and loses temperature with increasing distance from the heat producer. The higher the operating temperature of the heat network, the higher are these heat losses. The pipes of warm heat networks are therefore often additionally insulated, which, however, increases the construction price of the heat network. In addition to lower heat losses, a low operating temperature also favours the use of renewable energies and waste heat.