This paper presents a model-based optimization strategy for the condenser water loop of centralized heating, ventilation and air conditioning (HVAC) systems. Through analyzing each component characteristics and interactions within and between cooling towers and chillers, the optimization problem is formulated as that of minimizing the total operating cost of all energy consuming devices with mechanical limitations, component interactions, outdoor environment and indoor cooling load demands as constraints. A modified genetic algorithm for this particular problem is proposed to obtain the optimal set points of the process. Simulations and experimental results on a centralized HVAC pilot plant show that the operating cost of the condenser water loop can be substantially reduced compared with conventional operation strategies. (C) 2003 Elsevier Ltd. All rights reserved.