Heat Network regulation must be included in Queens Speech

Heat Trust is calling on the government to announce urgent new financial support for half a million households that currently have no protection against energy price rises and are experiencing much more severe increases than regular domestic gas customers.

Heat Trust, the national consumer protection scheme for heat networks, which protects households on communal and district heating networks, is warning that without government help, hundreds of thousands of people in the UK could be left unable to afford to heat their homes.

Heat Trust’s Director, Stephen Knight, has recently met with Business Secretary Kwasi Kwarteng and Energy Minister Lord Callanan to explain the dire position of communal and district heating customers: “Many communal heating customers are experiencing price increases of 400% - likely to take their heating bills next winter from £50 a month to £250 a month.

“Communal and district heating customers aren’t protected by the Ofgem price cap and operators buy gas at commercial prices, which have seen extraordinary increases in the past year. Without government support, customers simply won’t be able to afford to pay their bills.

“Sadly, ministers have so far offered little comfort that they are prepared to offer help to these customers, many of whom are flat tenants of councils and housing associations on low incomes.”

Heat Trust is urging the government ahead of the Queen’s Speech to fulfil its promise to regulate the heat network market and confirm Ofgem’s new powers to oversee the sector.

Stephen Knight said: “The government has been promising to regulate heat networks to bring in consumer protections and price regulation for some years and it is time this promise was finally fulfilled.  Sadly, such regulation will take several years to take effect and in the meantime  hundreds of thousands of people will face limitless price rises and have no access the consumer protections in place for other energy customers.”

Heat Trust says some residents and landlords operating heat networks are reporting potential rises of up to 700% - the equivalent of a pint of milk rising from 60p to £4.80.

Stephen Knight, Heat Trust’s Director, said; “Government gave us reassurance last year that regulation of heat networks would be going ahead and we are urging them to ensure this commitment is followed through in the Queen’s Speech.

“Regulation is absolutely vital for the 500,000 households which are currently overlooked, many of which include older people, social tenants, people with health conditions and other groups which are even more vulnerable to the harsh impacts of the cost-of-living crisis. We cannot let these households slip through the net of support and financial protection.”

Heat Trust is the independent national consumer protection scheme for heat networks and was set up to protect customers who receive their heating via such systems.

Heat networks are seen as a major part of the UK’s decarbonisation plans, and can deliver low-carbon, low-cost energy to homes. However, without the regulation the government has previously promised, consumers are not protected in the same ways as other energy markets.

Heat Trust is calling for government intervention to include:

• Ensuring heat network operators and their consumers receive government support to ensure that their bills are capped in the same way as those of domestic gas customers.
• Bringing forward its plans to regulate the heat network market via Ofgem.
• Bringing forward plans to help heat networks improve their efficiency.

Knight added; “Government has recognised the huge potential benefits of heat networks and how they can form a key part of its decarbonisation plans.  

“However, without intervention, hundreds of thousands of families are facing financial ruin and worse. We trust that the government will see the bigger picture and introduce the infrastructure needed to make heat networks effective for people and the planet."