Asked by: Neil Coyle (Labour - Bermondsey and Old Southwark)
Question to the Department for Energy Security & Net Zero:
To ask the Secretary of State for Energy Security and Net Zero, what legislative timetable he has set for introducing further regulation of heat networks, including any provisions relating to price protections for consumers.
Answered by Martin McCluskey - Parliamentary Under Secretary of State (Department for Energy Security and Net Zero)
Government legislated to introduce statutory redress, advice and advocacy from April 2025 and Ofgem regulation of heat networks from January 2026.
Government has provided Ofgem with broad powers to protect consumers, including on price.
Heat network suppliers and operators have until January 2027 to register with Ofgem and supply data, including information about pricing. Ofgem will use this to further inform their approach to pricing rules and guidance.
The Government has also just concluded a consultation to establish a Heat Network Technical Assurance Scheme to mandate minimum technical standards. These standards aim to improve service quality and reduce unplanned outages and operating costs by improving the efficiency of heat networks.
Asked by: Neil Coyle (Labour - Bermondsey and Old Southwark)
Question to the Department for Energy Security & Net Zero:
To ask the Secretary of State for Energy Security and Net Zero, what assessment he has made of the extent to which current regulation of heat networks provides equivalent protections to those available to domestic gas and electricity consumers, including guaranteed standards of supply and price protection.
Answered by Martin McCluskey - Parliamentary Under Secretary of State (Department for Energy Security and Net Zero)
The introduction of Ofgem’s regulatory powers in January 2026 aimed to introduce similar protections for heat network customers to domestic gas and electricity customers. However, there are some important differences between these sectors, for example: there are many more heat network operators and suppliers than in gas and electricity markets and they, typically, supply fewer consumers. This dictates a different approach to rules that have the potential for cost pass through to consumers, including Guaranteed Standards of Performance, which Ofgem has said it aims to consult on in due course.
Asked by: Neil Coyle (Labour - Bermondsey and Old Southwark)
Question to the Department for Energy Security & Net Zero:
To ask the Secretary of State for Energy Security and Net Zero, when he expects to launch the proposed call for evidence on heat network price protections; and what the intended scope of that review will include.
Answered by Martin McCluskey - Parliamentary Under Secretary of State (Department for Energy Security and Net Zero)
Heat network suppliers and operators have until January 2027 to register with Ofgem and supply data, including information about pricing. Ofgem will use this to further inform their approach to pricing rules and guidance.
The Department is working with Ofgem to assess data and evidence as heat network regulations develop and we will publish a Call for Evidence on heat network pricing in due course.
Asked by: Neil Coyle (Labour - Bermondsey and Old Southwark)
Question to the Department for Energy Security & Net Zero:
To ask the Secretary of State for Energy Security and Net Zero, whether his Department is considering regulating the non-domestic gas and electricity tariffs charged to heat network operators, in order to reduce costs passed on to their domestic consumers.
Answered by Martin McCluskey - Parliamentary Under Secretary of State (Department for Energy Security and Net Zero)
The Department has provided the heat network regulator, Ofgem, with broad powers relating to heat network price regulation. These include powers to investigate and intervene where heat network prices charged to consumers are disproportionate or unfair.
Ofgem has published authorisation conditions and issued guidance on the application of their fair pricing rules.
Heat network suppliers and operators have until January 2027 to register with Ofgem and supply data, including information about pricing. Ofgem will use this to further inform their approach to pricing rules and guidance.
Asked by: Neil Coyle (Labour - Bermondsey and Old Southwark)
Question to the Department for Energy Security & Net Zero:
To ask the Secretary of State for Energy Security and Net Zero, what estimate his Department has made of the average annual cost increase for households connected to heat networks as a result of recent increases in commercial gas prices.
Answered by Martin McCluskey - Parliamentary Under Secretary of State (Department for Energy Security and Net Zero)
Heat network operators buy the energy they need to provide heat to domestic consumers through commercial contracts.
The Department and Ofgem are actively monitoring the contract prices paid by heat network operators since the Middle Eastern crisis began and considering all options available to mitigate higher prices.
While price rises for heat network consumers have been limited to date, they will be more likely if wholesale energy prices remain higher into the winter.
Asked by: Neil Coyle (Labour - Bermondsey and Old Southwark)
Question to the Department for Energy Security & Net Zero:
To ask the Secretary of State for Energy Security and Net Zero, what steps his Department is taking to mitigate the exposure of heat network consumers to volatility in wholesale gas markets, given they are not protected by a domestic price cap.
Answered by Martin McCluskey - Parliamentary Under Secretary of State (Department for Energy Security and Net Zero)
Heat network operators buy the energy they need to provide heat to domestic consumers through commercial contracts.
The Department and Ofgem are actively monitoring the contract prices paid by heat network operators since the Middle Eastern crisis started and considering all options available to mitigate higher prices.
Asked by: Neil Coyle (Labour - Bermondsey and Old Southwark)
Question to the Department for Energy Security & Net Zero:
To ask the Secretary of State for Energy Security and Net Zero, what steps he is taking to ensure that households connected to heat networks are not disadvantaged compared to those using individual gas boilers as part of the transition to a low-carbon energy system.
Answered by Martin McCluskey - Parliamentary Under Secretary of State (Department for Energy Security and Net Zero)
The Government is committed to heat network consumers receiving a fair deal as we transition to a low-carbon energy system. WwWe have therefore introduced heat network regulation, including price protections, consumer standards and access to redress.
The Government also aims to introduce mandated minimum technical standards through a Heat Network Technical Assurance Scheme, to improve the performance and efficiency of networks, helping reduce long term costs for consumers.
Through the Heat Network Efficiency Scheme, the Government provides funding for improvements to underperforming heat networks , reducing operating costs, helping households connected to networks receive a fair, efficient and reliable service.
Applicants to the Green Heat Network Fund, which supports the development of low carbon networks, must also demonstrate that households will be no worse off.
Asked by: Neil Coyle (Labour - Bermondsey and Old Southwark)
Question to the Department for Energy Security & Net Zero:
To ask the Secretary of State for Energy Security and Net Zero, what assessment he has made of the potential merits of introducing a price protection mechanism for domestic consumers connected to heat networks, comparable to that provided by the Price Cap for domestic gas and electricity customers.
Answered by Martin McCluskey - Parliamentary Under Secretary of State (Department for Energy Security and Net Zero)
Heat networks buy the energy they need through commercial contracts and the price they charge domestic consumers reflects these individual contract prices and the energy efficiency of each heat network. Applying a price cap therefore risks being ineffective for consumers, if set to high, or supplier insolvency, if set too low.
The Department has provided the heat network regulator, Ofgem, with broad powers relating to heat network price regulation. These include powers to investigate and intervene where heat network prices charged to consumers are disproportionate or unfair.
Asked by: Neil Coyle (Labour - Bermondsey and Old Southwark)
Question to the Department for Energy Security & Net Zero:
To ask the Secretary of State for Energy Security and Net Zero, what discussions he has had with Ofgem on extending the current regulatory framework for heat networks to include price protections in addition to consumer standards.
Answered by Martin McCluskey - Parliamentary Under Secretary of State (Department for Energy Security and Net Zero)
The Department has provided the heat network regulator, Ofgem, with broad powers relating to heat network price regulation. These include powers to investigate and intervene where heat network prices charged to consumers are disproportionate or unfair.
Ofgem has published authorisation conditions and issued guidance on the application of their fair pricing rules.
Heat network suppliers and operators have until January 2027 to register with Ofgem and supply data, including information about pricing. Ofgem will use this to further inform their approach to pricing rules and guidance.
Asked by: Neil Coyle (Labour - Bermondsey and Old Southwark)
Question to the Department for Energy Security & Net Zero:
To ask the Secretary of State for Energy Security and Net Zero, whether he is considering reintroducing or adapting the Energy Bills Discount Scheme for households supplied via heat networks; and what assessment he has made of the effectiveness of previous support schemes for such consumers.
Answered by Martin McCluskey - Parliamentary Under Secretary of State (Department for Energy Security and Net Zero)
The Department and Ofgem are actively monitoring the contract prices paid by heat network operators since the Middle Eastern crisis started and considering all options available to mitigate higher prices.