One of the largest urban natural gas pressure reducing stations (CGS) with a nominal capacity of 300,000 (Nm3/h) in Iran has been investigated for the generation of electricity using the energy recovered in the gas depressurization process. Currently, natural gas pressure is reduced by using the regulating valve; consequently, the energy is wasted. To harness this wasted energy, an energy recovery plan was proposed that utilizes a turbo-expander. Comprehensive analytical environmental and thermo-economic analysis of the proposal was performed. Effects of various parameters, including turbo-expander and preheater efficiencies, electricity and natural gas price, nominal power of expansion turbine, turbine price and the temperature of gas leaving the expansion turbine was fully investigated on the system performance. The findings illustrated that 14.73 (GWh) of electricity can be produced annually using the recovered wasted energy in the studied station. The investment payback period was calculated as 4 years. The generalization of the results to all Iran’s CGS stations showed that 3.24 (TWh) of electrical energy and an average of 370 (MW) of electric power are possible to produce each year. Also, by using the proposed plan, 640,000 tons of CO2 emissions can be avoided annually.