Councillors on the Capital Programme Committee have backed plans to add Balnagask Circle to the existing network, which will incorporate the Deeside Family Centre, Balnagask House and Provost Hogg Court.
The network provides heat and hot water through a system of pipes designed to ensure low carbon emissions.
Up to £606,000 will be invested in the scheme. Aberdeen Heat and Power, which designed, built and maintains the existing district heating installation within Torry, will be the service provider for the extension. In addition, match funding is being provided from Interreg North West Europe Heatnet, a collaboration of 14 European partners.
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Cllr Marie Boulton said: "Sustainable heat and power has been a priority for the Council and the proposed expansion of the network in Torry is welcome.
"The investment will bring modest revenue savings in the short-term but the most tangible benefits are long-term, as the wider network is developed and the Energy From Waste plant feeds into that and enables the switch from gas heating.
"This project will bring real benefits to the community it serves and underline the Council's aspirations to continue to innovate in energy efficient and carbon reduction."
In addition, the Committee also agreed to move forward with the first stage of approval for funding up to £550,000 for a city centre urban realm improvement project at Schoolhill.
The project principles would see the existing footway widened to improve the setting for both the Art Gallery and Cowdray Hall by reducing the carriageway width at Schoolhill whilst maintaining two-way traffic.
Cllr Boulton said: "The Council is pleased to be adding this project – which has the potential to support the City Centre Masterplan – to the Capital Programme.
"We need Aberdeen's heart to be an inclusive and attractive place where people will want to live, work and visit."
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