A computation algorithm for the techno‐economic evaluation and sensitivity analysis of an air‐preheated energy recovery system is presented. Through the study, we find that different equipment designs of the same project affect the benefit of the recovery system remarkably. It is therefore necessary to consider technical and economic factors simultaneously to obtain a reasonable evaluation result for an energy recovery project. The sensitivity study shows that the annual operating hours is the primary factor in the profitability of an energy recovery system; thus, the reliability of the recovery system should be considered as the investment decision is made. In brief, this article offers the concepts of economic optimization for an energy recovery system.