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Purpose

To analyze the structural changes in electrical energy production sector caused by rapidly growing economy and Lithuania's international environmental commitments to the EU and international organizations.

Design/methodology/approach

The case study estimates the environmental‐financial aspects of cogeneration system to be implemented at the boiler house. After quantitative estimation of the electric energy demands the financial comparison of long and mid‐term environmental measures is presented.

Findings

The study responds to European strategy towards doubling the amount of cogenerated electrical power and provides financial‐environmental estimates of cogeneration installations.

Research limitations/implications

Installation and maintenance of co‐generation system requires high investments, however, in a long‐term perspective it would result in a substantial environmental and financial effect.

Practical implications

The proposed scheme could be adjusted to the local conditions of the individual country as one of energy production options to bring about a sustainable energy future.

Originality/value

The analyzed quantitative assessment of national cogenerated energy potential serves as a tool for implementation of sustainable energy production in practice.

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