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Hi,
We model a lot of district heating in this way for our German projects. They are connected up to the local utility and so it is very difficult to model the DH in the way that LEED wants. Luckily for us, in the last few years LEED released a guide called "Treatment of Scandinavian District Energy Systems in LEED" (type it into google and the guide comes up) which doesn't just have to apply to Scandinavian district heating systems. It allows you to calculate your environmental impact and adjust your utility rates accordingly. It is a much easier guide to follow in my opinion. One thing we have notices is that not all reviewers are aware of this guide so it might fling back a review comment, however when we have pointed them back to the guide it has been clear sailing from there.
Annie