Abstarct: The strength of pinch analysis is that system information can be represented using simple diagrams (e.g. composite curves, grand composite curves) and thus targets for the system. In contrast, the power of exergy analysis is that it can identify the major causes of thermodynamic imperfection of thermal and chemical processes and thus promising modifications can be determined effectively. By combining the strengths of both methods, the proposed method can represent a whole system, including individual units on one diagram. It has been realised that the major limitation of pinch analysis is that it can only deal with heat transfer processes, not the processes involving changes in pressure or compositions, which are very common in power and chemical processes . To overcome this limitation, a generic diagram is used, which is the so-called Ω-H diagram, where Ω indicates the energy level and H states the amount of energy. Both energy and exergy balances for a whole system can therefore be represented simultaneously on this diagram. Using this diagram, the major advantages of both pinch and exergy analysis are combined since the diagram enables one to view the performance of a system and set targets for improvement. Meanwhile, the inefficient processes and equipment can be identified and thus promising modifications can be obtained by revealing the actual potential, which is determined by applying the concepts of unavoidable and avoidable exergy losses. The analysis of avoidable exergy losses indicates the maximum potentials (modification targets) which are achievable in current technical and economic conditions. In this report, the simulation of a 150 MW steam power plant was performed in a Cycle-Tempo 5 simulator and operational parameters of the system were modified using the exergy concept combined with a pinch-baxsed approach. The application results of CPEA in the power plant showed that its fuel consumption could be reduced by 2.2% and the thermal cycle performance could be increased from 35.1 to 36.6%.