Abstract Over the past ten years or so, various systematic methods have been described in the literature for the preliminary design of heat exchanger networks. These methods have bee applied to simplified example problems but there is little evidence of applications in industry. Hopefully this paper will show the reason for this situation by giving a fundamental understanding of the basic concepts involved in heat exchanger network design, both in simplified and practical contexts. We do not give much detailed description of the methods used in ICI 3 3 These methods were previously described by Linnhoff , Linnhoff & Flower , Flower & Linnhoff  and Boland & Linnhoff . In the present text will be referred to as the TI-method, the ED-method and the TC-method. but merely comment on certain aspects of these methods as well as other published work so that we can highlight the attributes which we believe successful methods must have. In particular, there are a number of physical facts and phenomena relating to networks in their entirety rather than to isolated unit operations. It is demonstrated that design methods can be immensely improved when these phenomena are properly taken account of.