Improving the energy efficiency of the municipal heat and hot water supply systems has been identified as a priority measure to reduce GHG emissions in the first national communication to the UNFCCC. Legislation on energy-saving measures was developed in 1998 and is now under consideration for approval. This legislation will establish the legal, social and ecological basis for energy savings in the different sectors of the economy. This project is relevant to national efforts to reduce GHG emissions in the residential and district heating system. Turkmenistan has substantial gas resources and there is very little national level priority given to reducing domestic consumption. Efficiency gains are of no direct interest to consumers since energy and heat prices are so low.