In many industrial processes and in data centres, part of the energy input is lost as residual heat. It is possible to recover the excess heat to be used as a new source of energy. Recovering and utilising residual heat reduces the demand for additional heat generation. In turn, this reduces fuel requirements, and subsequently emissions if fossil fuels are used to generate heat.

Residual heat can be recovered via pipelines and reused again on-site, or transported to another location for another use, such as district heating which heats the homes of residents. In cases where the temperature of the recovered heat is too low, heat pumps can facilitate increasing the temperature to a more suitable temperature.

Local governments can utilise their wide knowledge and influence to map residual heat flows and heat demand sites to help connect heat supply and demand across stakeholders in the most optimal way. As well as supplying industry with this knowledge, local governments can provide subsidies to industrial sites and data centers to help them to procure the relevant infrastructure and additional technology (e.g. heat pumps). What is more, local governments can commission the development of district heating networks.