Heat Networks

Heat networks distribute heat from a central source to multiple properties and are usually a cheaper and greener alternative to traditional gas-fired boilers in each property. An on-site energy centre generates hot water or steam, which is then pumped through underground pipes to provide space heating and hot water within the properties. Often, heat is supplied alongside cooling and private wire electricity.

Heat networks come in many guises and are otherwise known as district heating schemes, communal heating schemes and combined heat and power (“CHP”) projects. Investing in heat networks is seen as a vital part of the transition to net zero by 2050 with the Government looking to expand their use almost tenfold by 2050 in order to help meet its carbon reduction targets.

Some heat networks are large enough to attract an energy services company (“ESCO”) on a full-risk basis. Others simply outsource one or more services, such as operation, maintenance, metering, billing, tariff setting and customer services. Some schemes are best served by a hybrid of the two.

Heat networks regulation

The heat networks sector is at the start of a major transition, facing its first wholesale regulation with the introduction of the Energy Act 2023 which establishes a new regulatory framework for heat suppliers and operators in the UK. The Act aims to enhance sustainability and decarbonisation by ensuring efficient and compliant heat networks, moving away from fossil fuels like gas-fired CHP towards renewable generation such as heat pumps, biomass, recovered heat, geothermal heat and hydrogen.

We can guide you through the potential impact of both incoming regulation and decarbonisation on existing contracts and future-proofing for the inevitable changes.

We support across all phases of a project, including: