District heating networks serve around half a million UK homes, but many on these schemes often pay the price for the service. The Competition and Markets Authority is launching an investigation into these schemes to assess whether people are really getting a good deal.
District heating networks supply multiple homes with hot water and heating from one central source, which is distributed through a network of pipes.
There are benefits to heating networks – you get your heating and hot water from a central source delivered straight to your home, so you have no need to maintain a gas boiler. They can be more efficient and environmentally friendly too.
However, as we’ve heard here on Which? Conversation, those on heating networks often come up against problems that far outweigh the benefits.
District heating
One major issue is that there’s no control over the price you pay, with Which? Conversation commenter Richard saying:
‘Our bills are three times what they used to be and this is just for hot water, we cannot afford to put the heating on as this would just tip our bill into silly numbers. For just hot water, we pay on average about £45 a month with a usage of around £11. We then have to pay for our electricity bill on top of these crazy bills.’
District heating customers also have no say over who supplies them and don’t have the right to switch, as Amanda explained:
‘I have recently moved into a three bedroom townhouse powered by a district heating network. I also was not told about the £1.20 standing charge per day fee. My bill from end of Nov to beginning of Jan was nearly £300.’
And as district heating network suppliers are not regulated, most customers don’t have access to the Energy Ombudsman. This means that when things go wrong with your network, there’s little you can do, as Dee explains:
‘We are connected with district heating as we live in a communal area and we have no choice. The problem is it comes from a main base somewhere and it keeps going wrong. We receive calls stating: ‘your heating is off in your blocks until we can fix it’. Now its freezing winter and it has been turned off two days this week already for repairs. When we complain we receive a response stating that someone will get back in 15 days. Whether it’s cheaper than paying separately I don’t know. But it comes with many problems.’
However, customers of suppliers signed up to the Heat Trust scheme have a slightly better complaints procedure available to them. Heat Trust’s independent disputes resolution service operated by the Energy Ombudsman. This service is free to customers of companies who have signed up to Heat Trust.
CMA investigates
With limited protections, little to no choice over supplier, an inability to switch, not to mention paying over the odds for hot water and heating, it’s a good to see that the Competition and Markets Authority (CMA) is looking into district heating networks.
It will examine three areas:
- Whether customers are aware of the costs of heat networks both before and after moving into a property.
- Whether heat networks are natural monopolies and the impact of differing incentives for builders, operators and customers of heat networks.
- The prices, service quality and reliability of heat networks.
With half a million households heated by these schemes and an estimated 20% of households expected to be on them by 2030, we want the regulator’s review to deliver a much better deal for people.
We’ll be sharing your experiences, as well as our research and insights with the CMA, and look forward to getting an update on the regulator’s plans.
Are you on a district heating network? Do you think you get a good deal? What problems do you come up against?
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