New Regulations under the Energy Prices Act 2022 oblige heat network operators to ‘pass-through’ savings on fuel costs from the Energy Bill Relief Scheme (EBRS). Notifications to customers of any benefit should have been issued by November 30th (or 30 days after receiving a benefit, whichever is the later) and operators must pass-through the benefit by the time the next bill is issued.
Whilst this welcome requirement could save customers hundreds of pounds on their heat bills at no cost to the operator, it is only a short term fix. All operators should be reviewing the efficiency of their heat networks to ensure bills are minimised when the government support is reduced or withdrawn in April 2023.
Our analysis shows that on a typical heat network with a gas-supply contract from September 2022, improving system and generation efficiency from typical practice to current best practice would have the same impact as the Energy Bill Relief Scheme, saving customers £450/yr, but this would be permanent. Achieving savings of this scale on existing networks is not easy and may require extensive remedial works to central plant, control systems, distribution pipework, insulation and even systems within the demise of final customers. This only strengthens the case for acting now.