Heat Trust has responded to the Department of Business, Energy and Industrial Strategy (BEIS) consultation on building a market framework for heat networks. Heat Trust welcomed the consultation and supports the decision to appoint a sector regulator. Statutory regulation is a key step to ensuring customer protection for all heat network customers.

The key proposals in the consultation centre on licensing and an authorisation regime:

• The proposed legislative changes will give heat network developers equivalent statutory rights and undertakings to other utilities, such as gas and electricity. A licensing arrangement will be established for those parties that wish to secure these additional powers.
• The proposed authorisation regime for consumer protection would give Ofgem oversight and enforcement powers across quality of service, provision of information and pricing arrangements for all domestic heat network consumers. This would be funded through fees scaled according to the regulated party’s size.

Transparency, pricing and quality of service standards are key elements of the protection regime customers need. Other important aspects include access to independent redress and enforcement powers - with which heat networks can be held accountable to.

Heat Trust already sets minimum standards in many of these areas and can help suppliers prepare for the transition to regulation. We also look forward to building on our learnings and experience with government to help inform new regulation.

Heat Trust’s full response to the consultation can be found here.

Heat Trust, the consumer champion for heat networks, has appointed a new Director.

David Watson takes up his new role on 1 June, replacing previous Director Bindi Patel.

David comes to Heat Trust from Centrica, where he was Director of Group Strategy. Prior to this role, he was Head of Market Design and New Energy for British Gas, with responsibilities including leading low carbon policy development within the GB and EU retail market. He said:

"I am delighted to be joining Heat Trust at what is a very important time for both the organisation and the wider sector. Membership is growing and customer service standards continue to rise across the sector. 

Up to five million homes could be reliant on the heat network infrastructure by 2050.  Consumer interests need to be absolutely at the heart of this growth and I look forward to building on the fantastic work that has been achieved over the past five years.”

Ms Patel has been at Heat Trust since it was launched in 2015. During this time, she has overseen Heat Trust’s coverage expand to more than 10% of the market with 80 heat networks registered serving over 50,000 homes and micro-businesses. Heat Trust’s work has been recognised by the Government and has become a recognised industry standard. She said:

“I am proud of the work we have achieved in championing consumer protection in a sector that will grow ever-important as the UK works towards net-zero carbon targets. Over the last five years Heat Trust has worked to deliver benefits for customers through the standards it sets, which suppliers strive to meet for the good of the industry. I am delighted to have contributed to that and look forward to seeing Heat Trust grow further.” 

Casey Cole, chairperson of Heat Trust, welcomed David to the team and wished Ms Patel well in her future role. He said:

“We are delighted by the success of Heat Trust, and we would like to thank Bindi for her leadership and dedication to the scheme’s success over the past five years. We wish her every success in her new position. David has a proven track record that will see Heat Trust go from strength to strength and we look forward to moving forward under his leadership.”

ENDS

Heat Trust, the consumer champion for heat networks, says customer service standards are continuing to rise across the industry.

The independent customer protection scheme has hailed a successful fourth year of holding the heat network industry to account, with figures from its latest annual report showing that complaints regarding heat networks reduced by 54% in 12 months.

Heat Trust was launched in November 2015 to put customers at the heart of the rapidly expanding heat network market. It sets consistent customer service standards for the sector, building on standards set in the gas and electricity markets.

Up to five million homes could be reliant on the heat network infrastructure by 2050, a ten-fold increase from the estimated 440,000 homes currently on heat networks in the UK.

“We are pleased and encouraged with the progress demonstrated in our fourth report,” said Heat Trust Director Bindi Patel.

“The industry recognised the need to address challenges around customer experience and to put consumers at the centre of all future plans. The standards we have set through Heat Trust are helping to improve the market for the better and ensuring that people living on heat networks know what to expect from their suppliers.

“It is also encouraging that our contribution has been recognised across government.”

Latest figures show an average of 4.72 complaints per 100 customers in 2019 down from 12.9 per 100 customers the previous year.

There was also a drop in the number of complaints referred to the Energy Ombudsman – although of all complaints made to the Ombudsman only 9% were not upheld.

Heat Trust’s standards mean customers receive guaranteed service payments if they have experienced an outage that has not been restored in an agreed timeframe. More than £25,000 worth of payments were made to customers for this reason.

Research into annual heat bills by The Department for Business Energy and Industrial Strategy suggests that, on average, an annual heat bill on a heat network is £100 lower compared to individual heating. However, billing and heat charges have continually been the topics customers most frequently raise complaints on.

Billing and charges accounted for 37% of complaints, closely followed by technical issues representing 36% of complaints.

The annual report highlights the importance of data collection and the need for industry wide performance metrics.

Joanna Read, Policy and Operations Adviser at Heat Trust, said “Each year we have been able to report on more and better quality data. Going forward we are seeking to gather further insights such as on debt and disconnection.

“This year we have collaborated with our Registered Participants to develop more meaningful metrics for outages such as origin of the issue, where there is a clear overlap with customer experience. However, wider performance metrics for the sector are needed to progress this work further.”

Heat Trust remains a voluntary scheme but is continuing to expand each year. It now provides protection to more than 10% of all residential and micro-business customers on heat networks, with 80 heat networks accounting for over 50,000 homes and micro-businesses registered.

The government has confirmed it intends to introduce statutory regulation and appoint a sector regulator to the heat networks industry, a move that has been welcomed by Heat Trust.

Ms Patel added: “Heat networks have been identified as enabling infrastructure in all decarbonisation scenarios set out by the Committee on Climate Change, but they must offer a good experience to customers if the market is to grow as projected.

“Heat Trust will continue to champion service standards in the industry and will seek to make sure that issues such as transparency over charges, clarity on terms and services and accountability over technical performance are part of a future regulatory framework.”

ENDS

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Notes to editors:

Heat Trust launched in November 2015. It sets out a common standard in the quality and level of customer service that heat suppliers should provide their customers.

It also provides an independent process with the Energy Ombudsman for settling complaints between customers and their heat supplier. This service is free for customers to access. 

Our annual reports can be found here: https://www.heattrust.org/annual-reports-v2

For more information contact Bobbie Hough at Hough Bellis Communications on 07794204268 or email This email address is being protected from spambots. You need JavaScript enabled to view it. 

Today, Heat Trust welcomes an agreement by members of the Heat Network Investment Council (HeatNIC) to ensure heat networks customers are protected and supported during the Covid-19 pandemic.

The agreement sets out a series of commitments, which echo key principles and requirements set by Heat Trust. In addition, many of the HeatNIC members with operating heat networks serving residential customers are Registered Participants of Heat Trust.

Welcoming the agreement, Bindi Patel Director of Heat Trust said:

“Energy is an essential service and during this time it’s important that customers are supported and have access to reliable heating and hot water. This requires a caring and flexible approach.

I am very pleased to see the Heat Networks Industry Council make this pledge today, which echoes key principles required by Heat Trust. The steps outlined by the Council in conjunction with the standards set by Heat Trust are a clear demonstration of the heat network sector’s commitment to protecting customers.”

Heat Trust is working with its Registered Participants to ensure customer needs are prioritised and supported. A dedicated coronavirus page for customers can be found here.

Notes

About Heat Trust

Heat Trust is all about protecting heat network customers.

We are an independent, non-profit consumer champion for heat network customers that holds the industry to account for the benefit of everyone involved. We make sure customers enjoy heating systems fit for the future by:

• Applying strict customer service standards to heat suppliers, similar to those for traditional gas and electricity suppliers;
• Providing access to an independent dispute resolution service through the Energy Ombudsman; and
• Working with suppliers to promote best practice, innovation and continuous improvement in customer service.

Launched in November 2015, Heat Trust provides protection to over 10% of residential and micro-business heat network customers. Our annual reports can be found here.

About HeatNIC

The Heat Networks Industry Council brings together leaders of the heat networks industry to support Government in achieving its vision of achieving a sustainable industry. The Council’s offer to Government, to be published in the next few months, will identify measures it can take to:

• Create jobs and investment (focusing on the investment that could be unlocked by the sector, and the number and quality of jobs that will be created as a result)
• Cut costs (to both those looking to invest in heat networks and customers supplied by a heat network)
• Set out the industry’s commitment to decarbonisation
• Create more liveable, smarter cities (including how it can support grid balancing services and flexibility and improve air quality)
• Drive excellence in customer service and standards 

The Council has been established by the Association for Decentralised Energy (ADE), who provide the Secretariat.

The transition to a low or zero carbon economy cannot be achieved unless it works for residents.

Heat networks are an essential part of decarbonising heating in the UK, being more efficient and able to connect to any heat source including waste heat. Like any utility, there will be some customers who would benefit from additional support. There is a more particular need for care for customers in vulnerable circumstances living on heat networks because they are currently monopoly supply arrangements where customers cannot switch their supplier.

In the UK, heating and hot water are essential services for householders. Reliance on these services can be higher among certain residents, depending on their circumstances at any given time. For example, those with young children, those who spend a significant time indoors or have long-term illnesses are likely to have a higher level of dependence on household utilities. These customers may also have less flexible usage patterns of heating and hot water.

Other customers may find it challenging to communicate with providers due to their circumstances, such as mental health issues, those who are recently bereaved or experienced a significant life shock, language barriers or disabilities such as being partially sighted or hearing impaired.

Another potentially difficult interaction is for those who are struggling financially, whether because of on-going low income or recent events affecting financial stability, and many can feel uncomfortable or awkward discussing these issues with suppliers.

Any of these circumstances, along with many others, could affect us at any time, and can combine to mean that we are “less able to protect or represent our interests in the energy market”. This is Heat Trust and Ofgem’s definition of customers in vulnerable situations.

In fact, a Mando webinar recently pointed out that when you add up the various scenarios for vulnerable situations – e.g. considering that 1 in 4 UK residents will experience poor mental health every year, 21% of adults don’t have basic digital skills and 11 million people in the UK suffer from hearing loss – it becomes apparent that these are not minority considerations.

How the heat supplier interacts with all customers, but especially those in vulnerable situations, can have a significant impact on their satisfaction and willingness to engage further with their supplier.

Suppliers can be proactive in providing additional support for customers. Measures can include training frontline staff, both in responding to enquiries remotely and property visits, to be able to identify potential vulnerabilities and know what the supplier can offer that customer. It can also include processes such as flagging customer vulnerabilities on internal systems and robust strategies for keeping ‘priority services registers’ up-to-date.

Some heat suppliers are more prepared for this than others, which is where Heat Trust can help. Heat Trust sets minimum standards for the heat network sector on customers in vulnerable situations, among other customer protection standards, in our ‘Scheme Rules’.

Heat Trust has now been in operation for over 4 years, and we are reviewing the Scheme Rules in stages to ensure they remain fit for purpose. The first ‘package’ to be reviewed is customers in vulnerable situations, where we have looked at the approaches of other regulators e.g. Ofgem and Ofwat, and looked into NICE guidelines on how a warm home impacts health. This research also fed into additional guidance for the suppliers who are registered with Heat Trust.

This is timely as Ofgem, the regulator for gas and electricity markets, has recently updated its consumer vulnerability strategy. This area is also likely to be a key focus of the new regulator when UK regulation for all heat networks (currently out for consultation) is introduced.

If you work in this sector, or are interested in learning more, please read our consultation and answer any of the questions that are relevant to you in the form provided by Thursday 12^th March.

Author: Joanna Read