In 2018, the Competition and Markets Authority (CMA) recommended that the government regulate the heat network sector. This recommendation followed a report that discovered a lack of protection and transparency for heat network customers. The recommendation was also guided by net zero pathways, which suggest around one fifth of all heat and hot water will be provided by low-carbon heat networks in 2050.
The primary legislation required to introduce heat network regulation was included as part of the Energy Act (2023). It gave the secretary of state the power to appoint a regulator for heat networks and introduce further legislation on the regulatory framework. Ofgem was later appointed as the regulator.
In 2024 and 2025, Ofgem and the Department for Energy Security and Net Zero (DESNZ) released a series of consultations on the design of heat network regulation. These consultations, some of which CIH has responded to, set out the overarching framework for regulation, as well as beginning to specify some of the detailed requirements that heat networks will have to adhere to.
Regulation formally began on 1 April 2025, when Citizens Advice and the Energy Ombudsman started their roles as heat network consumer advocate and advice service, and ombudsman, respectively.
The full launch of regulations is 27 January 2026, covering consumer protection and the overall regulatory framework. On this date, reporting requirements also begin. All existing heat networks operating before January 2027 will be automatically authorised; after this period, authorisation will be granted by application to Ofgem.
Operators of heat networks that are pre-authorised will need to register with Ofgem using a forthcoming heat networks digital service by 26 January 2027.
Further information
