Thousands of customers will enjoy more equitable energy

New plans to provide heat network customers with reasonable prices for cleaner heating.

Hundreds of thousands of heat network customers may benefit from lower energy prices.  

Under the proposals, homes and businesses which rely on heat networks would be afforded additional consumer protections only available to those with conventional gas and electricity contracts.  

This would assure fairer prices through their involvement in a future price cap on energy bills, consistent quality of service and heat supply standards, and clear, consistent billing.  

Beginning in 2025, Ofgem will be able to intervene in situations where residential and commercial customers face problems with disparate pricing, poor customer service, and poor reliability.   

Ofgem’s actions could also include imposing penalties for inadequate service and mandating that operators compensate customers during a power outage. Vulnerable customers, such as the elderly or those with health conditions, would be better protected if heat network operators were required to maintain a registry.  

Lord Callanan stated: “We are investing millions in constructing new heat networks to reduce emissions and provide affordable heating to communities nationwide.” “Heat networks enable people to heat their residences in a more eco-friendly manner while reducing their expenses and carbon emissions. They are also important to our efforts to increase energy independence and security.”

“As more households and businesses connect to these innovative systems, it is only fitting to ensure consumers are adequately protected, pay a fair price for their energy, and receive the best possible service.”

Heat networks can provide heating and hot water to tens of thousands of people at a low cost by releasing large quantities of renewable and recycled heat found underground or generated by manufacturing.   

The consultation will contribute to the 2050 goal of having heat networks supply 20% of the nation’s heating.   

Ofgem’s regulatory framework for monitoring and enforcing consumer protection regulations will be shaped with input from consumer groups and the business community.

Greater investment will also be attracted to a regulated and trustworthy sector in which standards are harmonised, and heat network developers are granted rights and powers to facilitate their growth.  

In May, the government announced £22 million in financing for developing Cornwall’s first system to extract heat from deep underground. 

The Langarth Deep Geothermal Heat Network will utilise geothermal energy from hot granite rocks underneath Cornwall to heat 3,800 regional residences and public buildings.   

This was one of seven innovative heat network initiatives in England that received funding from the Green Heat Network Fund totalling £91 million.  

The government has also launched the £32 million Heat Network Efficiency Scheme to upgrade old and inefficient heat networks, providing cheaper, greener energy to thousands of households in England and Wales.  

The consumer protection consultation for Heat networks concludes on October 27, 2023.