A combined air conditioning and tap water heating plant using carbon dioxide (CO2)) as refrigerant has been investigated theoretically and experimentally. The system is suitable for countries with year around cooling demand, such as Indonesia or Singapore, and a need for hot tap water. A unique CO2 transcritical cycle characteristic for heating process can afford an improvement to a CO2 air conditioning system when rejected heat from the system is recovered. Some parameters affecting performance of the combined system are discussed. (C) 2004 Elsevier B.V. All rights reserved.