This paper presents the concept of Dual Demand Side Management (2DSM) as an evolution of the conventional Demand Side Management concept. 2DSM accounts at the same time on one hand for the local needs, i.e. energy efficiency of the building stock as well as optimization of the local distribution grid and on the other hand for the challenges of the higher level electrical grid arising from the integration of renewable and alternative energy sources. The proposed concept shows the possibilities originating from the interaction of local district heating, heat storage and micro grid technology. Finally the paper shows the development and testing processes required for designing complex multi-domain systems.