District heating is an environmentally friendly heating principle that is widely used in Sweden. A problem that has arisen is that while district heating dominates heating of apartment buildings, the district heating companies have difficulties competing in single-family houses. In Örebro, the 7th largest city in Sweden, this problem causes some worries because of the environmental benefits with district heating compared to electricity-based heating alternatives which are more commonly used. The goal of this study has been to calculate the life cycle costs for district heating in Örebro from the house owner’s perspective and to compare these with the life cycle costs for heating by geothermal heat pumps. The study also examines the potential of a few proposed solutions for improved economy for district heating in areas with single-family houses. The calculations estimate the life cycle costs during 30 years for district heating to 697 kkr and 562 kkr for geothermal heat pumps. High energy costs being the primary reason for the district heating’s expensive outcome. A possible solution to improve the situation for district heating is the development of low temperature distribution.This could decrease the heat losses and thereby make district heating less expensive. Another solution that will make district heating more profitable in the future is district heating powered machines such as washing machines, dryers and dishwashers. The use of these machines replaces electricity consumption with heating consumption. For the use of these machines in houses with conventional district heating a separate pipe is needed which makes them not profitable at the moment. In Västerås, a city comparable to Örebro, low temperature grids are being developed with district heated machines in areas with newly built low energy houses. This solution uses a secondary grid with only one pipe for heating, heating of water and the district heated machines. The life cycle costs for this solution is 653 kkr, much less expensive than the conventional district heating in Örebro. An introduction of a similar solution in Örebro could make district heating in one-family houses more profitable, for both producer and consumer.