Heat Network Regulations explained: What UK landlords need to know
Understanding the new rules
The UK Government is bringing in new regulation for shared heating systems, known as heat networks.
Until now, heat networks haven’t been regulated in the same way as gas or electricity. From 27 January 2026, Ofgem (the same regulator that oversees gas and electricity) will start regulating heat networks across Great Britain.
The new regulation focuses on creating consistency in good customer service, improving the reliability of energy supply, and ensuring energy bills are transparent, easy to understand, and fairly priced.
The detailed rules are still being finalised through Government and Ofgem consultations. This guide is here to keep you informed, but it’s for general information only, not compliance or legal advice.
These changes mean that landlords and property managers who run buildings with shared heating systems e.g. HMOs, blocks of flats and student accommodation may soon need to register with Ofgem, provide clearer billing, and meet service standards for tenants.
Preparing early will help you avoid surprises once the rules take effect.
Key dates for landlords
| Date | What happens |
|---|---|
| Late 2021 | The UK Government announced that Ofgem would become the regulator for heat networks across Great Britain. |
| 1 April 2025 | Ofgem officially takes charge of regulating shared heating systems. If you already run a building with communal heating, and the property falls under the regulation, you are automatically covered under the new rules. |
| 27 January 2026 | The new Ofgem-led regulatory regime for heat networks will formally launch and become enforceable. |
| 27 January 2027 | By this point, anyone running a shared heating system that falls under the regulation will need to be formally registered with Ofgem. |
The three main regulations behind the change
Heat Network (Metering and Billing) Regulations 2014 – made sure shared heating systems have meters where possible and that residents are billed for what they actually use.
Energy Act 2023 – gave the Government the legal power to regulate heat networks more tightly, and to formally appoint Ofgem — already named in 2021 — as the regulator.
Heat Networks (Market Framework) Regulations 2025 – will bring the full rules into force, requiring anyone running a shared heating system to register with Ofgem, report key information, and meet minimum standards, though many of the finer details are still being finalised.
Who’s affected: Understanding the operator and supplier roles
Before we dive into what the regulations mean, it helps to understand two important terms used by Ofgem, “operator” and “supplier.” They simply describe the two main roles involved in running a shared or communal heating system.
Operator: The operator is the person or company that owns or controls the physical heating system — for example, the boilers, pumps, and the network of pipes that deliver hot water to each home.
Supplier: The supplier is the person or organisation that charges residents for heating and hot water, handles billing and metering, and manages complaints.
Many landlords choose to outsource parts of their heat network operations — such as billing, metering, or maintenance — to specialist companies like ours, managing agents or an Energy Services Company (ESCO).
However, it’s important to understand that outsourcing doesn’t transfer your legal responsibilities under Ofgem’s heat network rules. In many cases, landlords are both the operator and supplier — meaning they’ll hold most of the new responsibilities.
What the new regulation means for landlords
A lot of the detail is still being confirmed through ongoing consultation, but here’s a clear view of what’s already confirmed and what’s still being decided.
| Area | What’s confirmed |
|---|---|
| Who’s covered | Any person or organisation that operates or supplies a shared heating system serving more than one home will need Ofgem authorisation, although they are working through a proportionate approach. This includes many landlords and housing associations. |
| Authorisation requirement | Existing networks will be automatically (“deemed”) authorised from April 2025 to January 2027, but must register during this period. New networks will need full Ofgem authorisation before operation after January 2027. |
| Consumer protection | Ofgem will have powers to enforce standards for billing transparency, complaint handling, and minimum service levels. |
| Metering and billing | Landlords must continue to meet obligations under the Heat Network (Metering and Billing) Regulations 2014 — using meters and billing based on actual use where possible. |
| Enforcement powers | From January 2026, Ofgem can take action against networks that breach authorisation conditions or fail to meet consumer protection duties. |
| Area | What’s being decided |
|---|---|
| Pricing and fair-cost rules | Ofgem is consulting on “fair pricing” frameworks — including how costs are broken down, whether profit margins will be capped, and what transparency tenants must receive. |
| Unbundled heat charges | Rules may require landlords to separate heat costs from rent or service charges (so tenants see what they’re paying for heat specifically). Implementation and timing are still being discussed. |
| Technical performance standards | Minimum efficiency and reliability standards are planned, but details of how they’ll be measured and enforced are still being shaped. |
| Small networks and exemptions | The Government is considering a proportionate approach for smaller landlords, housing associations, and smaller communal systems. Exact thresholds and reporting duties are not yet confirmed. |
| Transition arrangements | Further guidance will set out exactly how existing networks move from “deemed” authorisation to full authorisation by 2027. |
What landlords should do now
Even though some details are still under consultation, landlords can take simple steps now to get ahead:
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Start by reviewing each building you own or manage:
Does it use a shared heating system (one central boiler, plant room, or heat pump serving multiple homes)?
If yes, you’re likely running a heat network that will need to be registered with Ofgem.
Keep a simple record of each property’s setup — including how residents are billed and who maintains the system.
💡 Tip: You don’t need to overcomplicate it. A short spreadsheet listing your addresses, heating type, who operates it, and how tenants are billed is a great start.
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Make sure you know who operates the heating system and who bills residents.
If you’re the one controlling the central boiler and collecting payments, you’re probably both the operator and supplier.
If you use a managing agent or ESCO, check your contracts — even if you’ve outsourced the work, you might still hold legal responsibility.
💡 Tip: Keep copies of your service contracts handy — they’ll help you show who’s responsible once Ofgem’s registration process begins.
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Under current rules, buildings with communal heating should have meters where possible, and residents should be billed based on what they actually use.
If your setup is still unmetered, it’s worth reviewing whether meters or heat cost allocators could be installed.
Transparent billing will become even more important under Ofgem’s framework.
💡 Tip: Make sure your invoices or service charge statements show how heating costs are calculated — this will help meet upcoming transparency requirements.
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Ofgem will publish detailed guidance before the new registration portal opens in 2025.
The portal will be where landlords and operators register for authorisation and submit details of their heat networks.
Final pricing rules, exemptions for small networks, and performance standards are still being finalised.
💡 Tip: Sign up for Ofgem’s Heat Networks updates or the GOV.UK email alerts so you’ll be notified when new guidance is released.
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The new framework is designed to make heating systems fairer and more transparent.
Review your tenancy agreements to ensure heating costs and complaint routes are clearly explained.
Think about how you’ll communicate changes to tenants once the new rules take effect.
💡 Tip: Clear, friendly communication now helps build trust — and avoids confusion once billing transparency becomes mandatory.
The direction of movement is clear: more transparency and stronger consumer protection. Much like many other industries we have seen this happen to from motor finance to financial advice.
The smart move is to get organised. A quick property audit, a look at your billing setup, and keeping an eye on Ofgem’s updates will put you in a great position when registration opens.
You can track progress here: Ofgem – Heat Networks
This blog is for information only. Landlords should always check the latest Ofgem publications or seek professional advice.