Burning firewood for heating purposes in South-West Chile results in serious air pollution issues. The biggest cities in the region are in the forefront of the list with worst air quality in the continent, which culminates during winter days. The biggest local issue is the concentration of PM2.5 in the air, which not just leads to unbearable air quality, but for severe health issues and premature deaths in the city of Temuco. Currently, around 90\% of the households use inefficient, individual wood stoves for space heating, which results to high PM2.5 emission. The municipality would aims to mitigate the effects with banning the use of firewood at critical days, and with the help of stove replacement program.

In this study, District Heating solution is introduced to offer a possible alternative heating option for the city, which can solve the given air quality problem. The introduction of the technology and its consequences are assessed, elaborated on the following research question:

How can the introduction of a District Heating system in Temuco help to solve the city's air quality problem?

Based on the current and the projected future heat demand, the study identifies the areas of the city where district heating is suitable, and evaluates different supply solutions which are fulfilling the demand of the chosen areas. The result of the different technical assortment are compared with the respective consequences of the stove replacement program while assessing economic and pollutant emission perspectives. In the last part of the study, the possible barriers are identified, and new policies are advised to shape the framework more favorable for district heating solutions.