The paper presents a thorough analysis of the historical data and results acquired over a period of two years through an on-line real-time monitoring system installed at a combined heat and power (CHP) plant. For gas turbine health and performance assessment, a gas path analysis tool based on the adaptive modeling method is integrated into the system. An engine adapted model built through a semi-automated method is part of a procedure which includes a steam/water cycle simulation module and an economic module used for power plant performance and economic assessment. The adaptive modeling diagnostic method allowed for accurate health assessment during base and part load operation identifying and quantifying compressor recoverable deterioration and the root cause of an engine performance shift. Next, the performance and economic assessment procedure was applied for quantifying the economic benefit accrued by implementing daily on-line washing and for evaluating the financial gains if the off-line washings time intervals are optimized based on actual engine performance deterioration rates. The results demonstrate that this approach allows continuous health and performance monitoring at full and part load operation enhancing decision making capabilities and adding to the information that can be acquired through traditional analysis methods based on heat balance and base load correction curves.