AbstractThermal energy storage (TES) enables more efficient use of conventional energy conversion plants and enhances the exploitation of renewable energy sources. Storage primarily promotes the replacement of heating oil with less expensive fuels, for instance biomass, coal or industrial waste heat. In this paper, some applications of heat storage for large‐scale and centralized residential heating systems are presented. Analysis methods to estimate the economy of storage in these energy‐systems are also derived. It was estimated that the maximum market potential for short‐ and long‐term heat storage in the present Finnish heat production system would correspond to about 1–1.3 TWh of supplied heat