This paper is a case study of thermodynamics and economics related analyses applied to an existing gas/steam combined cycle cogeneration plant. Basic thermodynamic properties of the plant are determined by energy analysis utilizing main operation conditions. Exergy destructions within the plant and exergy losses to environment are investigated to determine thermodynamic inefficiencies and to assist for guiding future improvements in the plant. Cost balances and auxiliary equations are applied to several subsystems in the plant, hence, cost formation in the plant is observed. Additionally, cost rate of each product of the plant is calculated. Copyright (c) 2005 John Wiley & Sons, Ltd.