This paper describes a method of detecting temperature sensor faults in a district-heating substation (DHS). It uses valve position monitoring and variance monitoring to detect sensor faults. Depending on user requirements the method can be customized either to detect faults quickly or to have a low false alarm rate and be able to detect smaller noise increases but at the expense of longer detection time. The result is a method that uses a limited amount of computing power and does not require much computing precision, since the only computing done is addition of integers. The method is therefore suitable for implementation in a microcontroller.