In several housing development projects in Norway the requirements related to the mandatory connection to district heating plants have shown to be a barrier for building low-energy residential buildings. The developers have considered the costs related to both low-energy measures and a space heating system that can utilize district heat to be too high to give the project acceptable profitability. In these projects the developers wanted to use a cheaper electric space heating system. Based on models representative for the range of the Norwegian district heating plants, calculations show that the CO2 emissions related to heating in residential buildings with an energy standard in accordance with the new building regulations and that are connected to the district heating grid, are lower than for similar buildings with a low-energy standard and with heating based on electricity. However, in a long term perspective the differences are marginal when considering the national annual CO2 emissions. Similarly, increased peak power demand due to electricity-based heating may also be regarded as marginal when compared to the present maximum peak power capacity in Norway. (c) 2007 Elsevier B.V. All rights reserved.