Co-generation system is installed for District Energy supply systems in many cases, and the economic feasibility is not generally investigated in consideration of its failures, but the impact of failure is not small since Co-generation system usually covers power, heating and cooling supply. Therefore, the objective of this study is to investigate technological assessment of district energy system with CGS taking into account the failure of CGS. The happening of failure is stochastic process depending on the number of CGS units. An optimization model was employed to minimize the system cost including expected penalty which represents the loss of energy supply due to the failure. The simulation results show that the cost of energy shortage affects a large proportion for annual operation cost. Although failure is generally not considered in case of using high availability equipment, it became clear that the result of the optimal planning with considering the cost balance of annual operation cost if it encounters failure.is changeable on this research. It indicates it is beneficial to consider the probability of failure for the planning of CGS systems.