Communal Heating Systems – What leasehold property managers need to know?
Discover moreWhat is a communal heating system?
A communal heating system involves distribution of heat across a building, such as a block of flats, from one central source.
Communal heating systems are becoming more commonplace in the UK as they are proven to reduce energy costs and carbon emissions. Between the 1950’s and 1970’s, district and communal heating systems were popular with many built during the council housing boom. Since the 1970’s the National Grid made gas widely available leading to individual heating systems being favoured.
In 2010, the Department of Energy and Climate Change estimated that up to 20% UK domestic heat demand could be served by heat networks by 2030. In 2014, The Heat Network (Metering & Billing)Regulations 2014 came into force but what does this mean for leaseholders in buildings with a communal heat network?
The landlord of the building becomes the heat supplier under the regulations but, depending on how the leases are constructed, this responsibility could pass on to residents management companies, right to manage companies or managing agents (as a de-facto supplier)
The Heat Network (Metering and Billing) Regulations (HNMBR) affect suppliers of heat networks in the UK. The regulations require heat network operators to notify the Secretary of State about their heat networks every four years and, where necessary, to install heat metering devices on those networks. Additionally, the landlord will be responsible for accurate and regular billing in accordance with the Heat Network Regulations.
The Heat Network (Metering & Billing)Regulation is regulated by the Office for Product Safety and Standards (OPSS), part of the Department for Business, Energy and Industrial Strategy (BEIS).
Many older building will be exempt but it is up to Landlord to determine which category the building falls into which will be one of the following:
Viable – Those who must install heat meters.
Open – Those who must complete a viability exercise to determine if they are required to install meters or heat cost allocators.
Exempt – No further action required.
Further Reading
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