James Stanier
Partner
Article
4
Under the Energy Security Bill (the "Bill"), the Government is proposing to bring in regulation of district heat networks to ensure that consumers are receiving best value for money. This follows on from a recommendation by the Competition and Markets Authority which found that some customers using heat networks were experiencing worse outcomes than the average consumer including high prices and frequent outages. The Government is proposing the implementation of heat networks zoning to aid the rollout of heat networks. On 1 September 2023, the Government published its proposals under the Bill.
A heat network is a distribution system of insulated pipes that delivers heat from a central source and delivers it to domestic and non-domestic buildings. Under the Bill:
Zoning is where central and local government work together with businesses and local stakeholders to identify and designate areas for which heat networks are the lowest cost solution for decarbonising heat. Certain buildings would then be required to join the heat network. The aim would be to give greater clarity to businesses and local stakeholders about where heat networks will be deployed.
The Government has provided the first proposals under the Bill and industry is eagerly awaiting additional information from the Government. We regularly advise a range of clients (including generators, suppliers, network operators, government departments and energy traders) on wider energy regulatory matters. If you require further advice on navigating future changes to heat networks, please contact James Stanier and Russell Evans for more information.
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