/ Home & Energy

Turning up the heat on district heating

pipes

Many of us don’t trust energy suppliers, but what if you were stuck with one supplier for as long as you lived in a property, with no control over the price you pay? This is the reality for many district heating customers.

More than 200,000 homes across the UK are connected to a district heating network. This is where heat from a central source is distributed to properties through a network of pipes. And its use is growing, particularly in built-up urban areas. The Government thinks district heating could provide heat to eight million homes by 2030.

There are benefits; it can be low carbon and there’s no need to maintain a gas boiler. However, there is currently very little protection for consumers living in properties connected to district heat networks. They have no choice in who they get their heat from. No access to an ombudsman should they have a complaint. And no control over the price they pay.

We’ve uncovered unacceptable detriment

Over the past year we have been conducting a major investigation of district heating. We spoke to customers on district heating networks, including those of you who shared your views here on Which? Convo. We found widespread dissatisfaction, with cost a major concern.

The people we surveyed had concerns ranging from worry that they had been mis-sold district heating, to confusion around what was included in their bills. Many of them felt let down and frustrated by poor customer service and complaints handling procedures.

It’s an emotive issue, as one private homeowner from London told us:

‘We are stuck between the supplier and the developers, with each blaming the other for the lack of hot water. All the while we … face numerous outages and so have to boil a kettle to wash or bath my two and a half year old in.’

We also looked at the cost of district heating and found a huge difference in the price paid by customers. Some were paying up to 25% more for their heating than if they’d been on a standard gas deal, and that includes all the additional costs of installing and maintaining a gas boiler. In many cases, district heating customers couldn’t understand why they were being charged a high standing charge, despite not having the heating on and using little or no hot water.

District heating – what’s the solution?

We have been working with the industry on Heat Trust, a voluntary consumer protection scheme. Heat Trust aims to replicate many of the protections available to those with gas or electric heating, such as access to an ombudsman and guaranteed standards of performance. However, as a voluntary scheme, it won’t cover all consumers and it won’t tackle the issue of fair pricing.

Access to affordable and reliable warmth and hot water is a fundamental right; we rely on it for comfort and health. Everyone deserves a fair deal and great customer service from their heat supplier. However, there’s a danger that district heating companies will take advantage of their unregulated, monopoly position.

We think the next government needs to step in to address the issue. It must look beyond ‘voluntary’ consumer protection and review fair pricing for district heating schemes, while heat suppliers should improve complaints handling and ensure pricing is transparent.

Do you have first-hand experience of district heating? Do you think the next government needs to step in to protect consumers?

Useful links

Read the report – Getting a fail deal for District Heating users [PDF]
What are my rights with district heating?

Comments
Roseann Kealy says:
15 July 2015

Hi, I live in the Olympic Village in the East End of London. My energy providers are East London Electricity. I have received my latest monthly bill for £28.40. While this may not seem much, I was in hospital from the 1st June to the 1st July, and had turned the heating off completely prior to my admission. So with that in mind, if I didn’t have the heating on at all for a whole year, I’d still face an annual bill of £340.80, which seems an awful lot to me. The bulk of the bill was attributed to ‘Fixed Costs’ & CHAC. Does this seem correct/reasonable?

Thanks for any input.

Kindest regards,

Roseann.

Adam Smith says:
17 July 2015

We live in Tower Hamlets and have had a similar issue to Roseann. We actually had no hot water for 4 months yet were hit with a bill for £170 for this period. I have been trying to get the supplier Evinox to cancel the bill but they point me in the direction of the housing group (One Housing) who in turn blame the supplier. Both parties have accepted in writing that we did not have hot water over this period so cancelling the bill would appear to be common sense but nothing has been done. I am also worried about future calculations when we do have hot water!

Is there anyone we can contact to help sort this out as stated in the article there does not appear to be an ombudsman?

Thanks,

Adam

Seb Goldsmith says:
17 July 2015

We moved into a new block of flats last year. We only found out it had district heating after we had exchanged. We were told that someone “ought to have explained this to you” but they never did.
The flats are so well insulated we haven’t needed to have the heating on (they’re 25-29 degrees with the windows open). The boilers and HIUs are supplied by Evinox.

Our bills are about £70-90pcm. Only about £5-15 of that is hot water. The rest is standing charge, which (you guessed it), goes to the developer’s management company (Circle/Old Ford), via Ener-G Switch2. We have enquired as to the breakdown of the standing charge. Apparently there is a £1m sinking fund for repairs, but this is not held on trust for the residents a service charge would be.

It’s a service charge by any other name, but cleverly manages to escape the service charge laws. It’s a monopoly, daylight robbery and we are stuck with it.

NO CHP THANKS says:
17 September 2015

Good for you that you still get a break down on the standing charge and see a £1m figure for your sinking fund.

If you ask the same question to another big player in the sector, you won’t be told any details. I think they now have at least 15 maybe even 20 site in the UK. If the business model is similar, £1m each seems to be a handy.

Nice to see the comments, having reading issues on Which? for quite some time and we are part of the Development at Highams Park called Highams Green.

We have been fighting for the past 20 months on the costing and transparency of the whole system, we have asked for the consumption figures, efficiency and other data and till date nothing has been provided to us.
We even got Rip off Britain interested in our case, this issue is being aired on 15th September 2015.

“Over the past year we have been conducting a major investigation of district heating.”

I’ve searched the Which? website and can’t find any other mention of this investigation. Do you have a link to the results?

Hello Mark, apologies, we’ve just relaunched the website and the link to the PDF of our report went walk abouts. Here it is: http://www.staticwhich.co.uk/documents/pdf/turning-up-the-heat-getting-a-fair-deal-for-district-heating-users—which-report-399546.pdf

The rip off program got aired on Tuesday and for the interested here is the link

We are second story in on the show.

http://www.bbc.co.uk/iplayer/episode/b06cpcj0/rip-off-britain-series-7-episode-2

Thanks very much for sharing! You may have seen our very own Pete Moorey on the show.

NO CHP THANKS says:
17 September 2015

I think you asked a very good question in the programming regarding electricity. Not combining bills on electricity and gas when you using CHP seems to be very unreasonable. If you add your electricity bill to your heating bill, then it would be even more shocking as the amount is huge.

I am not sure if you check more on government website, if you were having micro CHP in your flat, the deal won’t be too bad. However, we are all punished because we are on a communal network. That should be a question for DECC I guess.

Do you think there is any chance to get BBC to investigate the issue further and report more issues from other sites as well? I think the issue deserve much more attention than it has got.

This was filmed in February this year and we also put them in touch with a couple of other developments and from what I can see they were quite a bit cautious on covering this issue as they did not have much information in terms of facts and actual figures.

And our aim was to at least get this on TV so it becomes a bit more widespread, any thing to get this mess sorted is better.

Please help me gather evidence for our MP and the CAB at

https://www.surveymonkey.com/r/NSMXW2M

this survey will take less than a minute to complete – please pass this on so we can get more responses

I have had the worse experience with district heating. We moved into a newbuild 2 bed flat owned by housing association. Only after signing the tenancy agreement were we told that we had to top up credit from our local Londis. When asked if we could change, we was told no. We was reassured the cost would be cheaper and much better deal.

Far from wrong. From then on, I couldn’t cope with the high costs. Not only did we have defective meters, requiring monthly readings, we was left in debt by trying to keep our home warm and running hot water.

Many of us complained about the high costs but our landlord did not care. Being a single mum to a teen, having constant hot water and a warm home is a priority for me. Never once have I left my son without heating and hot water. But after living, here, despite cutting back more than half of what I previously would use, I had no choice but to go without myself.

I could no longer afford to pay for my sons after school clubs as all the money was going to Switch2. Our landlord wasn’t bothered one bit. When money starting going very quickly, we again contacted the housing association as we would only have 2 sometimes 3 heaters on. We had to shower a lot less, not ideal when you have a teenager in puberty!

I paid more than £420 from September 2014 to March 2015. I’m sorry but that’s a lot of money. It’s only me and my son living together. We are always careful not to waste. But both Switch2 and the housing association insisted I was paying the correct amount due to topping up the same amounts the previous year! They stated the coat was 12 kWh.

In May, we was told we were having the meters updated to a new G6 meter. I refused to sign the new utility agreement stating the high costs, wanting to change supplier and didn’t need to agree as I was waiting to move. June came, the meter was installed.

What a joke. Since September 2015 to December 2015 I have paid £260. Our housing association, a London
charity deducts 55 pence a day plus 12 pence kWh. The standing charge is for their admin costs. On top of that, they decide on what we should be charged and at what costs. According to Switch2, they are paid by the housing association to collect our money.

Since June, we having been topping up online through Allpay. But you have to top up money by 5.30 pm for it to be added on the next day, so your money wouldn’t be on your meter until the following day. If you top up after 5.30 pm, then it gets added do on the day after that. If it’s a bank holiday or a Sunday, your money you have paid, doesn’t go on until Tuesday.

District heating managed by landlords is disgraceful. This has been my worse Christmas. £30 goes in a week just like that. The greedy standing charge is shameful. 14 days equals £7.70.

I didn’t expect to run out of credit over Christmas. We wasn’t using no where near as much heat or hot water, simply because it was going so fast. Plus it’s not been that cold. The night before Chrismas Eve, I saw how low my money had gone. I woke up early Christmas Eve, paid £30 again as by then I was in emergency credit. The £30 went on today. Now they have an app which doesn’t take till the next day to go on when you pay.

Thanks to our greed you landlord charging us high costs, which they claimed was cheaper and affordable has put us in debt again. My son wasn’t able to get half the stuff i was going to get him. Same for his birthday in March as from January to March is when I have to top up and pay a lot more.

This is down to landlords. We should be able to choose and switch if we wish to as we do not pay the housing association directly. We pay online through Allpay, who then send it to Switch2, who then pay the landlord.

Be careful people. If you’re rich, then you’ll be fine. Don’t ever trust your landlord. Make sure you ask about your energy supply for your home when you view your property, not after you sign the tenancy. It’s very sneaky and sly what and how our landlord mislead us.

When I move, first thing I’m checking is that I have freedom over who supplies my energy and that my home isn’t above communal bins, like it is now which I wasn’t told or shown when viewing and signing the tenancy. I found out from my neighbours that our flat was above the bins for 38 flats.

I have never been so depressed, stressed, sad and struggling like I have since living here.

Its nearly a year since the Which? report. is there am up-date coming?

NO CHP THANKS says:
17 May 2016

I started talking to Which in 2013, by 2015, the person who initially work on the case changed job. So I am not even sure if there is anyone still look at this now at Which.

Amanda says:
11 April 2016

I have recently moved into a 3 bedroom townhouse powered by Eon 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 (approx 1 month). The builders had set the heating on so it was programmed to be on nearly all day. The engineers had put pipes in wrong so in order for me to have hot water, I needed the thermostat set higher than room temperature. Barratt agreed to pay for this time period but I’m still chasing this. Barratt also didn’t give the original meter readings to Eon so they set it as 0 which I am now in debt over.
Since then, I have programmed the thermostat to only come on a minimal amount of time set at 20 degrees. I’m still using 50units a day somehow. Eon engineer has been out and said meter is working fine and that I’m doing all the right things i.e I close all doors and have radiators turned to lowest setting in rooms I’m not using. Eon engineer then hinted at blaming Barratt in plumbing for radiators e.g. fault valves?
I seem to be stuck between Eon and Barratt who are blaming each other. In the meantime, I am going through 50units a day to bave my heating on 20 degrees for 2 hours in the morning before work and 3 hours of an evening before bed. Not sure what else to do?

Mr GreyArea says:
15 December 2016

Are you still have high usage?

I thought you might be interested in this ruling by the ASA on district heating: https://www.asa.org.uk/Rulings/Adjudications/2016/4/E,-d-,ON-UK-plc/SHP_ADJ_301757.aspx#.Vw4HL_krJaS

Thank you, Patrick. Common sense has prevailed in the ASA’s assessment but I doubt it will lead to any reduction in costs for district heating consumers , just a less controversial way of comparing them. The whole rationale of district heating was that, through economies of scale in distribution, centralisation of the heat source, and using more efficient means of heat production, there would be a saving over stand-alone domestic boiler systems.

Thanks Patrick. I see that action has been taken as a result of two complaints.

Wouldn’t it be wonderful if ICO and Ofcom would get their act together and take effective action to tackle nuisance calls.

NO CHP THANKS says:
17 May 2016

I first would like to say, it is one step toward the right direction.

However, it just scratched the surface of the whole issue. Unless users are allowed to switch supplier, the cost would not come down. I still have around 21 year left on my 25 year service agreement with EON.

Saddique Ahmed says:
25 July 2016

I think its absolutely diabolical that the OK government and its agencies (Ofgem, Ombudsman or any other) do not regulate heat. Heat is a source of energy that is being supplied in the UK. Whilst this has been introduced to reduce carbon footprint and cost to consumers, I have seen nothing but dissatisfied customers/ tenants with regards to standing charges, cost of heat per pwh and not being able to change suppliers. People are being ripped off by landlords and associations and in our case, we were not even informed of the costs and charges and now being expected to fork out a bill for near enough £90 – £100 per month. The Government (Ofgem and Obudsman) need to get on this straight away because tenants are being taken advantage of because of the lack of regulations/ safeguards for tenants.

We are connected with district heating as we live in a communal area, we have no choice. The problem is it comes from a main base somewhere and it keeps going wrong, and we receive calls stating, your heating is off in your blocks until we can fix it, now its freezing winter and its been turned off two days this week already for repairs. Since councils always try to work as cheaply as they can, this happens every year. when we complaint we receive a response stating someone will get back in 15 days, in the mean time we all meant to freeze or buy electric heaters to keep warm…The council control our heating. I had to get in touch with local mp but I guess the council will just come back with excuses as usual. We get no refunds either for paying extra for this on top of our rent…Whether its cheaper then paying separately I dont know. But it comes with many problems.

Richard says:
20 March 2017

Is there nothing we can do about this scheme? our bills are 3x 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, with the standing charges being the rest of the bill, we put the heating system on for 30 mins a day just enough for two quick showers we often run out of hot water for other things as we have to fill a tank in our flat which takes up a lot of room as part of our heating system which seems silly and not very eco-friendly. We then have to pay for our electricity bill on top of these crazy bills, they just seem to be laughing at us when we ask why does costs so much.

We used to have a Gas heating system last year which heated the water on-demand which was about £20 a month including all standing charges, we paid about £480 a year on electricity and gas together and often got at least £120 back every year. We don’t get any money back from our two showers a day and is starting to cost almost around £600 a year which just seems wrong.

Ian Bell says:
26 March 2017

According to E.ON “our price promise guarantees it won’t cost more than heat alternatives”

““E.ON operate a Fair Pricing Policy and believe customers should pay no more for heating and hot water from a low carbon energy solution than they would if they had a standard new build property with a gas boiler.”

I would advise all customers to download they previous heat bills and review how much energy they have used plus charges and do their own comparison – like the Heat Trust online calculator allegedly E.ON fails to separate the huge heat loss in a HIU (something the customer pays for) so whilst you may consume 3000 units a year that does not mean that’s what you would have consumed with alternatives.

Trust me once the media and customers start to understand the unfair comparison the flood gates will open and customers will demand their money back!

Lawrence James says:
27 March 2017

The points that you’ve discussed are all valid. However, not all heat suppliers seek to take advantage of their consumers. There are suppliers that aim to provide services that will benefit their clients. With regards to expenses, there are companies such as Evinox Energy Ltd that provide consumers with options for billing and metering. Anyways, You can find more information here http://www.evinoxenergy.co.uk/ .

Denise Avard says:
13 December 2017

where I live it comes under the communal district heating and its very disappointing, we pay a set rate every week on top of rent and its always going wrong, every single week even in these freezing conditions we get electronic calls stating you you will have no heating or hot water to your blocks for several hours, this happened yesterday and it will be going off again tomorrow and its only 36 degrees currently and dropping temperatures, we are paying for a very poor service. These problems have been going on for years and at the last meeting the engineers and company connected with council and district heating decided not to show up to answer residents questions. We dont have the choice to switch either. And who do you complain to about this. All they do is pass the buck.