Based on the case of Denmark, this paper analyses the role of district heating in future Renewable Energy Systems. At present, the share of renewable energy is coming close to 20 per cent. From such point of departure, the paper defines a scenario framework in which the Danish system is converted to 100 per cent Renewable Energy Sources (RES) in the year 2060 including reductions in space heating demands by 75 per cent. By use of a detailed energy system analysis of the complete national energy system, the consequences in relation to fuel demand, CO2 emissions and cost are calculated for various heating options, including district heating as well as individual heat pumps and micro CHPs (Combined Heat and Power). The study includes almost 25 per cent of the Danish building stock, namely those buildings which have individual gas or oil boilers today and could be substituted by district heating or a more efficient individual heat source. In such overall perspective, the best solution will be to combine a gradual expansion of district heating with individual heat pumps in the remaining houses. Such conclusion is valid in the present systems, which are mainly based on fossil fuels, as well as in a potential future system based 100 per cent on renewable energy. (C) 2009 Elsevier Ltd. All rights reserved.