Heat networks regulation is coming

Heat networks provide heating, cooling and hot water to multiple properties in a building or to multiple buildings from a single source. From January 2026, Ofgem will begin regulating heat networks. This is an important step towards stronger protections and better outcomes for consumers. These new regulations will establish the fundamental standards that every heat network customer deserves and create a fairer, more reliable system that works for everyone. 

As many parties are not currently regulated as energy providers, this will require working with the heat networks industry and consumer bodies to fully understand the challenges and bring in a proportionate and effective approach. 

Why we need to regulate 

As a mostly unregulated market, unlike gas and electricity, heat network consumers are not offered many protections. 

We need to regulate so that energy consumers can be protected and get a fair deal. This means that we will begin to introduce some core protections, including:  

• how customers are billed 
• customer service standards 
• complaints handling 
• protections for vulnerable consumers 

We believe that regulation will create the stable, trustworthy environment that encourages investment in heat networks while giving consumers the confidence they need to embrace being on a heat network. 

The challenges

Introducing regulation poses significant challenges because of a combination of things including: 

• poor design  
• variations in customer service and consumer protection  
• the large number and diversity of organisations, public bodies and private individuals and other entities who operate heat networks  
• the interaction with housing regulation  

To address these challenges, we are taking a phased approach to introducing regulation and will be employing a range of different regulatory methods. 

The transition to regulation

The phasing in of regulations has already started with the introduction of advice and advocacy services for consumers.  

Then from 27 January 2026, Ofgem’s role will formally begin, and the initial set of rules will be in place. Existing heat network operators and suppliers will then have a year to register with Ofgem.  

By early 2027, we will have published the full set of rules for operators and suppliers, including pricing and Guaranteed Standards of Performance.  

Consumers should expect that, over time, the new protections will ensure a more consistent standard of service across the sector. Importantly, they will have a clear route to hold operators and suppliers accountable if their heat network fails to meet these expectations. 

What we have done so far

Setting up a new regulatory system is a huge task. We’ve been working with the government to develop policy. Colleagues in the Department of Energy Security and Net Zero (DESNZ) continue to work on their areas of responsibility which include technical standards and zoning. 

An important milestone is the recent publication of the joint response with the DESNZ on implementing consumer protections. This outlines the rulebook and the initial set of consumer protection standards that will take effect from January 2026. 

We’ve also published our response to the consultation on how we’ll oversee the sector, including the methods we’ll use to manage risks and protect consumers. 

We are very grateful to all those who have engaged with all our consultations and met with us to share their experiences and views. We hope this will continue. 

Next steps

As we get closer to the start of heat networks regulation, there will be lots of opportunities to submit your views, experiences and evidence to us. If you would like to stay up-to-date about policy developments, opportunities to contribute and the transition, you can join our distribution list by emailing us on heatnetworksregulation@ofgem.gov.uk.