More than half a million customers could get access to
compensation and fairer energy bills under new regulations to
improve their consumer rights.
Ministers have today (30 April) taken the latest step to
introduce much needed regulation to the heat network market,
publishing the government's response to a
consultation on consumer protections for homes and
businesses connected to heat networks.
Heat networks are a way of heating multiple buildings from a
central source. They can save costs and use green
energy. Customers on heat networks registered with the Heat
Trust can currently receive support when taking up issues with
suppliers – today's consultation response brings us a huge step
closer to boosting these protections to keep pace with a growing
market.
Under new regulations to be introduced from next year, families
and businesses connected to a heat network would receive greater
protection such as compensation if they lose access to heating,
fairer pricing, and clearer and easier to understand billing.
This will give customers similar consumer rights to those living
on traditional gas and electricity connections. Increased
protections for vulnerable customers – such as the elderly or
those living with health conditions – will also be
introduced.
, Minister for Energy
Efficiency and Green Finance, said:
Heat networks are expected to support millions of households in
the years ahead, as families look to cleaner ways to heat their
homes.
That is why it is vital we ensure customers connected to these
heating systems enjoy the same protections as other households in
our energy market.
Today's announcement will help deliver fairer prices,
compensation and more transparent bills, ensuring more families
can enjoy the benefits of heat networks.
More than 500,000 households and businesses are connected to heat
networks across Great Britain.
The proposals received strong support from industry bodies,
consumer groups, and heat network customers that responded to the
consultation in August 2023.
Once the new rules come into effect they will be regulated by
Ofgem, who will be authorised to step in when needed, where homes
and businesses have problems with disproportionate pricing, poor
customer service and poor reliability.
The Energy Ombudsman will support consumers with complaints they
have with their heat network operator, and Citizens Advice and
Consumer Scotland will be the statutory advocacy organisations
providing advice and support for consumers on heat
networks.
The government is also currently updating heat networks through
the £32 million Heat Network Efficiency Scheme, enabling network
operators to replace inefficient or old equipment to offer a more
reliable service and improved heating.
Projects to have received funding as part of the Heat Network
Efficiency Scheme include:
- Newport City Homes Housing Association Limited, which has
been awarded £3.7 million to upgrade the Duffryn District Heating
System, improving the performance of the network for more than
970 homes, a local school, and businesses
- Bristol Heat Networks Limited, which received £746,582 for
the Redcliffe Heat Network, with 740 residents benefitting from
improvements
Cathryn Scott, Ofgem Director for Enforcement and Emerging Issues
said:
Today's publication is an important milestone in the journey to
regulating this growing market and protecting consumers.
We are working with government to design and deliver a regulatory
regime that will be able to deliver improvements for heat network
customers. The framework will include consumer protections in the
areas of vulnerability, billing and pricing and a route for
escalating matters to the ombudsman.
, Director of Heat Trust,
said:
As the national consumer champion for heat networks, Heat Trust
has long campaigned for the regulation of the sector and we
therefore welcome this important milestone. These new regulations
must achieve tangible improvements in customer experiences in
terms of pricing, reliability and customer service if consumers
are to gain confidence in district and communal heating systems.
Gillian Cooper, Director of Energy at Citizens Advice, said:
This is another important step forward towards the introduction
of much-needed new protections for heat network consumers.
It's vital those who rely on a heat network for heat and hot
water receive the same level of protection as those on mains gas.
And, crucially, those on a heat network must receive the same
level of protection irrespective of the size or type of the
network they are on - particularly as they can't opt out or
switch to a new tariff.
It has also been announced that a further 10 projects will
receive over £5 million in government support creating new tools
and technologies to support the roll out of heat pumps through
the Heat Pump Ready Programme.
The initiative supports the development of innovative solutions
across the heat pump sector to support the aim of installing
600,000 heat pumps a year by 2028.
Notes to editors
See full details of the 10
projects to receive funding through the Heat Pump Ready
Programme.
