Air pollution with dust is particularly noticeable in winter. This problem is visible especially in those living areas in which furnaces fed by low-quality fuels are used for heating houses and flats. One of the possible ways of limiting the number of used furnaces may be heating and powering of the housing estates and villages by specially designed combined heat and power (CHP) steam (or vapor) power plants. To be competitive to other heating technologies these systems should be cheap, reliable and easy to operate. Therefore, their design should be as simple as possible. Steam or organic Rankine cycle (ORC) energy conversion systems utilizing simple volumetric expanders, which can be applied for distributed power generation are meeting these conditions. The article presents literature review as well as selected thermodynamic and design issues concerning these systems. Literature review gave an outlook on the modeling, experiments, operating conditions and possible configurations of steam and ORC CHP systems. Then, model of the CHP system was implemented in computer software. Thanks to the positive technical features and ability to operate with wet gas the screw machine was selected as the system’s expander. Selected experimental data obtained from the literature review were used for system modeling. Especially the operating conditions of the selected expander (i.e., maximum mechanical power, maximum inlet pressure, expansion ratio and internal efficiency) were assumed based on the experimental results, technical data and information reported in different papers. Expander’s operating conditions and technical data (in particular the value of maximum working fluid pressure allowable at the inlet to the expander) were the basis for pre-selection of working fluids which are possible to apply in the modelled system and selection of the heat source thermal parameters. Modeling was proceeded for different conditions and the results show that depending on the operating conditions and applied working fluid electric power output of the CHP system ranges between 1570 and 2511 kWe (for heat source temperature of 200 °C) and between 1583 and 2631 kWe (for heat source temperature of 150 °C). However, not only maximum power output should be considered as the selection criteria of the system design and working fluid choice. The other important criteria are related to maximization of the obtained electric power, minimization of the vapor pressure at the outlet of the vapor generator and at the inlet to the expander, minimization of the working fluid flow, minimization of fuel consumption and maximization of the temperature of the working fluid at the outlet of the expander. The modeling results show that from all cases studied the ORC CHP power plant utilizing screw expander, using MD2M as working fluid and featuring the electric power of 1570 kWe fed by rapeseed oil is the best possible solution if technical assessment criteria are taken into consideration. Such a system can cover the heating demands of ca. 9615 flats.