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The purpose of this paper is to investigate the reduction in efficiency of central heating systems of multi-family buildings when independent heating capability is offered to each apartment, to access the impact of the applied heating cost allocation (HCA) on this deterioration and suggest highly cost-effective ways (operation, control strategy, alternative HCA) of overcoming them at minimum cost.

The paper reveals the problem of reduced efficiency in centrally heated multi-family dwellings through two case studies in real buildings, where data-loggers were installed and performance curve analysis was performed, in combination with detailed simulation.

The paper finds that the enforcement of a suitable HCA regulation is a prerequisite to achieving energy savings in centrally heated multi-family dwellings. In addition the effects of dissimilarly heated apartments on the total energy demand and the significance of indirect heating and how these should be charged, are assessed. It is found that convenient operation of the central heating system may lead to high energy cost savings and higher efficiency at no cost.

HCA adopted more than three decades ago should be revised according to the present situation, namely, increasing fuel costs, existence of many low income families, energy poverty, availability of alternative (or supplementary) heating devices and better building envelopes.

Occupants of multi-family dwellings should be appropriately educated and agree on rational use of the common heating system of the building.

The paper identifies weak points of valid HCA regulation, reveals inefficiencies in centrally heated multi-family dwellings and measures the actual effectiveness of remedying measures. Detailed simulation contributes to the scientific documentation of the findings.