We present two-dimensional numerical simulations for shortening a viscoelastoplastic lithosphere to quantify the impact of elasticity on strain localization due to thermal softening. The model conserves energy and mechanical work is converted into heat or stored as elastic strain energy. For a shear modulus G = 10^10 Pa, a prominent lithospheric shear zone forms and elastic energy release increases the localization intensity (strain rate amplification). For G = 5 × 10^10 Pa shear zones still form but deformation is less localized. For G = 10^12 Pa, the lithosphere behaves effectively viscoplastic and no shear zones form during homogeneous thickening. Maximal shearing-related increase of surface heat flux is 15-25 mW.m^−2 and of temperature at lower crustal depth is ∼150 °C, whereby these peak values are transient (0.1-1 My). Elasticity and related energy release can significantly contribute to strain localization and plate-like behaviour of the lithosphere required for plate tectonics.