Significant changes are now in place for heat network owners and operators across Great Britain. The Heat Networks (Market Framework) Regulations 2025 have taken effect from 27 January 2026, meaning heat networks are now regulated in a similar way to other utilities for the first time.
A heat network is a network that, by distributing a liquid or a gas, enables the transfer of thermal energy for the purpose of supplying heating, cooling or hot water to a building or persons in that building, and includes any appliance the main purpose of which is to heat or cool the liquid or gas. While the term ‘heat network’ is used broadly to describe systems that distribute thermal energy, only those classified as ‘relevant’ are subject to regulatory requirements.
Heat networks are now regulated under a full utility-style framework, moving beyond the lighter-touch legislation that previously applied. Ofgem introduces a formal authorisation system and ongoing oversight of operators and suppliers. The aim is clear: stronger consumer protection, higher service standards, and greater transparency in pricing and performance.
Why Is Regulation Happening Now?
The move to regulate heat networks is largely driven by the UK’s legally binding net zero target. Although electricity generation has become cleaner, cutting emissions from heating remains a major challenge. Heat networks are considered a key solution, especially in urban areas, and planned heat network zones will concentrate supply and demand. As operators in these zones will effectively act as monopoly providers, regulation is needed to protect consumers and ensure consistent service standards.
Changes From January 2026
Since 27 January 2026, it is unlawful to operate a heat network or supply heating, cooling, or hot water to customers without Ofgem authorisation. Existing operators are treated as authorised during a transition period but must complete registration by 26 January 2027.
The new framework introduces:
1. Stronger Consumer Protections
Customers will gain rights closer to those enjoyed by gas and electricity users, including clearer billing, fair pricing expectations, formal complaints procedures, and access to the Energy Ombudsman.
2. Standardised Technical and Service Requirements
Operators will need to meet minimum performance standards under the Heat Network Technical Assurance Scheme (HNTAS), ensuring reliability and efficiency across the sector.
3. Support for Decarbonisation
The framework is designed to encourage investment in low-carbon and waste heat sources, helping to reduce reliance on fossil fuels in heating.
Risks & Opportunities
Ofgem now has enforcement powers similar to those used in the gas and electricity sectors, including the ability to issue penalties for non-compliance. Operating without authorisation will be a criminal offence.
However, regulation also brings opportunity. Greater market confidence and structured oversight are expected to drive investment and expansion. New schemes are already progressing across parts of England, supported by government funding aimed at low- and zero-carbon heat infrastructure.
The rollout of heat network zones could also create long-term, stable demand, although property owners in designated areas may face obligations to connect.
How True Solutions Can Help
True Solutions can support organisations by:
🔥 Assessing existing heat networks against upcoming regulatory and technical standards
🌱 Supporting carbon reduction planning and integration of low-carbon heat sources
🌏 Advising on sustainability strategy aligned with net zero and wider ESG goals