Urgent decarbonisation of all energy-related sectors is vital in order to reduce climate change impact and secure sustainable growth. To achieve to this goal, increase of renewable energy sources, especially wind and solar, is crucial. Due to their intermittent nature, they are challenging to integrate in the power sector. One of the most recognized solutions is so called sector coupling – connection of various energy sector to achieve balancing of intermittent electricity production from renewable energy sources. District heating, in combination with heat pumps, is more than suitable technology for power and heating sector coupling. In order to secure the role of district heating in future energy systems with high share of variable renewable energy source, the impact of different boundary conditions such as district heating supply temperature, heat pump source temperature and availability, has to be studied. This project will provide systematic analysis of the impact of DH network parameters on the successful integration of variable RES in the power system through sector coupling and utilisation of building thermal mass as a thermal storage option. This will be carried out by developing numerical model capable of assessing opportunities of ancillary services and demand response capabilities enabled by heat pumps in future power markets combined with thermal inertia of buildings’ as the thermal storage. Then, strategies for a large-scale integration of heat pump technologies, in the power markets with a great share of variable renewable energy sources, will be developed. The project outputs will facilitate positioning district heating systems and heat pump technologies as the key component of future energy systems thus, enabling a greater share of RES in the final energy consumption, higher energy efficiency. Consequently, this will result in lower greenhouse gasses (GHG) emissions thus supporting EU energy and climate long-term goals and policies.