Consider a power station set up in the middle of a town with cold winters. In the first example it burns has, drives a turbine and cycles water back after some form of basic cooling loop.

In the second example the waste heat (after driving the turbine) is connected to a distributed heating system throughtout the town that heats buildings and pavements and so on. In this case the return loop is much lower temperature, say just above freezing.

In order to do work you need a temperature gradient, although I'm not sure if that is relevant here. On the one had there will be a bigger gradient between the boiled and cooled water, but on the other hand you need to use more energy to lift the temperature from the cooling loop to boiling.

How does the efficiency for purely energy generation compare in these cases?