The Concept Energy guide to the Heat Network Regulations
In 2016, The Government’s Heat Network Regulations will revolutionise heating efficiency law in tenanted buildings. They are complex, full of both pitfalls and opportunities. Failure to comply exposes commercial and private landlords to myriad risks; being ahead of the game offers valuable advantages and benefits.
Here we present Concept Energy’s crucial guide to how, where and why ‘heat suppliers’ must act.
What are the UK Heat Network Regulations?
The Heat Network (Metering and Billing) Regulations 2014 are UK laws, which implement requirements in the Energy Efficiency Directive.
They aim to drive heating efficiency improvements in both domestic and commercial tenanted buildings.
Why are they needed?
As an example, imagine 4 commercial office tenants share their building’s heating bill, based on their percentage share of the floor space they rent.
If one office works hard to use less heat, they will not be rewarded, because their bill has nothing to do with the heating they really use. So there is no incentive to close windows, turn thermostats down or become more carbon efficient.
Because the largest share of CO2 emissions from UK buildings comes from space heating and water heating, encouraging better energy efficiency here would save tenants valuable money, and improve buildings’ environmental impacts too.
Who do the Regulations affect?
They apply to anyone who supplies or charges for heating or cooling a building, either through a communal heating system, or a district heat network.
Therefore, the scope of the Regulations is wide. They would affect a landlord renting out office space, where offices share heating powered by a central boiler. They would also affect a landlord renting property in a domestic building where heat comes from a shared district heat network.
As a rule of thumb, if you rent out space shared by more than one tenant, you are likely to be affected.
Because the scope of the Regulations is so ample, the first thing landlords should do is check, urgently, on whether they must comply with the law.
Are air conditioned spaces included in the regulations?
Determining what is in and out of scope can be complex. In the case of air conditioning, if there is a central cooling plant (typically served by a chiller) then this is included. However individual air conditioning units serving one distinct area are not. Concept can undertake a survey of your property to determine what is ‘in’ and ‘out’ of scope.
What actions must affected landlords take?
Notify by December 31, 2015
Affected landlords, often called ‘heat suppliers,’ should already have provided detailed information in relation to each of their heating systems and buildings to the National Measurement Office (NMO). The deadline was December 31, 2015.
This information then needs to be updated every 4 years.
Duty to install meters by December 31, 2016
Heat suppliers must also ensure that heat meters are installed, to measure the consumption of heat, cooling or hot water by December 31, 2016. This assessment must be repeated every 4 years.
But, meters need only be installed if it is technically feasible or cost effective to do so.
Understanding the scope of this caveat is challenging. Concept Energy can help you establish your precise obligations and then advise you on what action to take.
Concept can undertake both surveys and works, proving and identifying whether meter installations are necessary, and, if they are, get the installation done on time and on budget.
What is the business opportunity?
Clearly, avoiding the punitive risks of non-compliance, potentially £5,000+, is a key driver. Further, you can win reputational advantage, gaining extra tenants and winning longer term business from those tenants you already have.
Remember, tenants will be delighted at the prospect of cheaper heating bills, and at the potential to live or work in a greener building.
In addition, you can use your compliance as part of your overall CSR reporting and sustainability marketing.
If you think you may be affected by the Heat Network Regulations contact us for more information on how we can help.