The decision whether or not to install cogeneration units mainly depends on individual economic considerations combined with ecological awareness. In countries with rather unfavourable economic conditions for cogeneration, government support or similar systems are considered to stimulate new investments. Although the economic feasibility of a cogeneration unit still strongly depends on site specific parameters, some general trends can be found. This paper clarifies which are the most important aspects in an economic evaluation of a cogeneration plant considering the context of a liberalised energy market. Also, a methodology for calculating the economic feasibility is set up. Firstly, the methodology is used to make a general analysis of the economic feasibility of cogeneration in Flanders, Belgium, taking into account the specific Flemish support systems. Different cogeneration technologies, including microturbines as a relatively new technology, are considered, as well as a broad range of sizes. Using average data makes it possible to compare those different sizes and technologies and to draw some general conclusions for the Flemish situation. After this case study, simulations are performed to quantify the impact of the variation of some crucial parameters on the economic feasibility of cogeneration. Ranking those parameters by their economic impact shows the high importance of the reliability of the installation and the power prices. The impact of changing energy prices is also examined, concluding that (gas fired) cogeneration should not fear the rise of gas prices. Where quantitative conclusions of this sensitivity analysis are based on specific inputs for Flanders, qualitative conclusions are still applicable to all similar countries. (c) 2007 Elsevier Ltd. All rights reserved.