DECC is investing £6 million in efficient heat technology.
London-based company Guru Systems, will use a share of the cash to develop tools which analyse Big Data on decentralised networks.
It will identify the causes of inefficiency and propose cost measures to improve heat networks.
The company claims householders could save an average of £179 average per year by using the technology and implementing cost-effective improvement measures.
It added the software could save UK heat networks £400 million in reduced energy costs in the next 10 years.
Casey Cole, Managing Director of Guru Systems said: “Losses on district heat networks can be a big issue for the increasing number of landlords and developers looking to build district heating systems into their schemes.
“Now, thanks to support from DECC, district heat networks have been brought into the 21st century, ensuring we can deliver energy efficient, cost-effective networks that work for everyone.”