Calling all Social Housing providers – do you know about the new standards and regulations and how they will impact on heat networks?

Are you a social housing operator of mainstream or specialist/supported housing? If so, from 1 April 2024, as a social housing landlord you must comply with a new set of consumer standards aimed at providing tenants with quality homes and services. 

From 1 April 2024, under the Social Housing Regulations Act 2023 (opens new window), a social housing landlord must follow:

• The Safety and Quality Standard – providing safe and good quality homes and good quality services;
• The Transparency, Influence and Accountability Standard – you must be open with tenants and treat them with fairness and respect so that they can access services, raise concerns when necessary, influence decision making and hold social housing landlords to account;
• The Neighbourhood and Community Standard – you must engage with other relevant parties in your community so that they can live in a safe and well-maintained neighbourhood and feel safe in their home; and
• The Tenancy Standard – you must allocate and let homes fairly.

These standards will be explained in more detail in a Code of Practice, currently being drafted. We will draw out the implications for the specialist/supported housing sector in a series of further Housing LIN blogs.

In addition, this new law brings forward a series of other changes, including:

• Strengthening the Regulator of Social Housing to carry out regular inspections of the largest social housing providers and the power to issue unlimited fines to social landlords
• Additional Housing Ombudsman powers to publish best practice guidance to landlords following investigations into tenant complaints
• Powers to set strict time limits for social landlords to address hazards such as damp and mould
• New qualification requirements for social housing managers

In the meantime, if your social housing tenants are on a heat network, as a social housing landlord, these consumer standards are aimed at safety, quality and good quality services and are directly relevant to you and the provision of heat you supply.

Heat networks are shared heating systems which provide a more energy efficient alternative to individual gas boilers.  On a heat network, water is heated or chilled at a central source of production (such as a large boiler or energy centre) and distributed and sold to customers through pipework for heating, cooling or hot water use.  The energy centre can employ any type of technology including: (i) boilers (running on gas, electricity, oil, biomass, waste heat or another fuel); (ii) a combined heat and power (CHP) plant simultaneously generating electricity; or (iii) a shared air source, ground source or water source heat pump. 

Heat networks can take the form of communal heat networks and district heating networks. Communal heat networks serve only one building e.g. a block of flats with a central boiler or plant room serving all the flats in the building, for example, in a sheltered housing scheme or extra care housing development.   District heat networks serve multiple buildings or sites (and the heat source can be located either inside one of the buildings that makes up the district heat network or in an external energy centre).

Additionally, the Energy Act 2023 (opens new window) appointed Ofgem to be heat regulator in England, Wales and Scotland with powers to:

• introduce a licensing regime for organisations that supply heat through a heat network and/or operate a heat network;
• take enforcement action where heat networks are not meeting required standards;
• investigate and intervene if prices charged to customers are disproportionate when compared with heat networks with similar characteristics; and
• set rules requiring the heat network suppliers/operators to disclose certain information to their consumers – e.g. fixed charges, tariffs, unit rates and a clear explanation as to how prices are set and how consumers are billed.

The Energy Act 2023 also appointed the Energy Ombudsman and Citizen’s Advice as the heat sector’s alternative dispute resolution body and consumer advocacy body respectively.

The regulations referred to in the Energy Act 2023 have not yet come into force as yet and it would take time to implement these – but, when they do, these consumer protection provisions will improve the quality of service from heat providers for heat network consumers across the country, including social housing tenants on heat networks.

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If you are a social housing landlord and found this of interest, contact Shakespeare Martineau for further information or to have a follow up discussion at: Sushma.Maharaj@shma.co.uk