Housing associations and heat network regulation

About heat networks

What is a heat network?

A heat network is a mechanism for supplying heat and hot water to a home or non-residential premises. Heat networks can be either communal, or district systems. Communal systems consist of a centralised large heating appliance (in more than 90% of current cases a gas boiler) located in the building (e.g. plant room in flats). District heat networks supply heat and hot water to a network of buildings and can have more varied heat sources (e.g. geothermal or waste heat). The majority of heat networks (85%) are communal, and despite district heat networks being larger – most domestic consumers are on communal schemes. Around 90% of heat networks supply residential buildings.

Consumer protection and the regulatory framework

Housing associations with heat networks will need to register with Ofgem for regulation. The regulatory regime will cover a wide range of topics, including: 

• Reporting to Ofgem, monitoring and enforcement. 
• Pricing regulation. 
• Complaints and redress. 
• Metering, billing and service charge reform. 
• Debt management and protections for vulnerable consumers. 
• Provision of information to residents. 
• Compensation. 

Technical standards and improving existing heat networks

Heat networks have generally provided more affordable heating and hot water for residents than other domestic heating systems. However, to prepare heat networks for the challenge of decarbonisation, improve service standards and lower costs, the government is planning to mandate a set of technical standards that heat networks (both new and existing) will have to meet through an accreditation scheme. Owners of heat networks will need to:

• Roll out more metering.
• Analyse current performance.
• Bring existing heat networks up to higher standards.

Draft technical specifications and draft assessment procedures were published by government in July 2025. This is not a consultation, but is a chance for the sector to become familiar with the standards prior to consultation (currently expected in late 2025).

The technical specifications detail the technical obligations to be fulfilled as part of the scheme including the:

• Technical requirements to be met.
• Performance monitoring requirements to be met.
• Key failures to be avoided.
• Evidence requirements to be provided to demonstrate conformity with HNTAS.

The assessment procedures detail the assessment activities to be undertaken to provide assurance that the obligations in the technical specifications are fulfilled. There is an sssessment procedures document associated with each technical specification.

The government has been piloting their technical standards throughout 2024 and 2025. More information is available here.

In preparation for heat network regulation, non-government organisations have been developing tools to support heat network operators. The Chartered Institution of Building Services Engineers (CIBSE) has developed a voluntary Code of Practice (CP1 (2020)) that sets out minimum technical standards for heat networks. CP1 (2020) is not an exact representation of the standards heat networks will be required to follow within regulation but it is a very good starting point because CP1 (2020) compliant networks will likely be well prepared for forthcoming regulatory technical standards.

Another standard for housing associations to be aware of in preparation for regulation is developed by the Building Engineering Services Association (BESA). It is a voluntary test standard and testing regime for the Heat Interface Units (HIUs) that transfer heat from the heat network into the homes of consumers. It aims to ensure that the HIU market meets the needs of those developing and designing heat networks, which ultimately benefits consumers.

Zoning and heat network expansion

To grow the heat network sector, the government is regulating it, providing funding to expand it and using ‘zoning’ to drive up scale. In short, zoning will mandate new homes and many existing communal heat networks to connect to larger heat network schemes in certain areas.

The government is undertaking a zone identification pilot, working with 28 local authority partners across England to better understand how zone boundaries should be defined, and what data is needed to best determine zone boundaries. The findings from this pilot will feed into the development of the Heat Network Zoning Policy.