Heat Networks Market Study
Updated: Jan 16, 2019
The CMA has recently carried out a market study on domestic heat networks, to review how well the market works and if consumers are getting a good deal.
VRM was cited as one of the responses. Here are some of the highlights:
Our responses to the CMA report are therefore based on our practical experiences of improving the performance of heat networks from our platform used at Camden and other clients. We very much welcome the opportunity to respond to the CMA as although there are 17,125 registered heat networks in the UK, the overwhelming majority of asset owners have little or no insight into the real-time performance of their network systems.
How could local and development plans and their supplementary guidance be adjusted to take lifetime costs and customer prices into account? What would the impact of this be?
Some of the impacts of this could be:
Schemes not going ahead
Greater use of renewables such as ground source heat pumps
Improved network efficiencies and a more combined approach between commercial and technical stakeholders within organisations
Greater use of technology to monitor and manage systems effectively
Greater resource for authorities in applying new guidance
Improved reputation for DHNs
Improved customer experience
Is further information required to improve consumer understanding of the significance of living in a home with a heat network? If so, what information would be useful?
Yes, VRM believe that as only 2% of the UK has DHNs the knowledge and understanding is currently limited. The difference between heat and power should be made clear (i.e. fuel is lost when making heat from gas); what the benefits are of district heating networks including the safety aspect of not having individual gas runs into homes; how to control heating including the use of programmers, TRVs etc; explaining the monopoly element of DHs and also useful website links including CAB, Heat Trust etc. Billing frequency, what happens if you build a debit or credit; transparency of bills; complains procedure; online access to your heating (as per access to gas and electricity usage online). The purpose of a heat meter and PAYG.
Should heat supply bills be improved? Is further information necessary? If so, what information would be helpful?
The efficiency of the system should be made clearer and what actions are undertaken to ensure the system is efficient – platforms like VRM can provide an online portal that can demonstrate to customers that the network is being efficiently run and monitored.
VRM have concerns that where PAYG is not used consumers are placed at risk of fuel poverty. This is because bills are estimated. VRM have knowledge of residents being over or under charged by hundreds of pounds, which means they could either be struggling to pay other bills only to have a large credit when bills are reconciled or run up a heat debt which then has to be recovered.
Should standard performance metrics for suppliers be produced- for example, in relation to planned and unplanned outages and heat temperatures? Should this information be published?
VRM believe that this would be best practice and should be monitored. However, publishing data may unreasonably disadvantage older networks and district networks as opposed to communal ones.