If the UK is to reach net zero by 2050, reducing carbon emissions generated by buildings and transforming our energy system must be key priorities over the coming years. The two ambitions are inextricably linked.
Around a quarter of the UK’s annual carbon emissions come from buildings, largely because the vast majority still rely on gas-fired heating systems. Landlords need to be encouraged to transition to more energy efficient options at the earliest possible opportunity in order to drive the decarbonisation of the 30 million buildings across the country.
Changes in technology together with a new regulatory framework mean that landlords are faced with a rapidly evolving energy market, featuring a confusing array of options — from rooftop solar to EV charging infrastructure. That is why DLA Piper have published a new Landlord’s Guide to Energy, a comprehensive resource designed to keep landlords informed on the latest changes affecting the sector and what it means for them. It also sets out the various grant funding available to UK landlords to support them on the road to decarbonisation.
Heat networks are one example of a new technology with the potential to transform our buildings and energy market. The UK government has estimated that scaling up heat networks requires potential investment of GBP60 billion to GBP80 billion by 2050.
These networks supply heat from a central source – ranging from power stations, energy from waste facilities, biomass and biogas boilers, combined heat and power plants, heat pumps, geothermal sources, electric boilers, and solar – to consumers via underground pipes carrying hot water.
They can cover large areas or small clusters of buildings and are particularly effective in high-density areas like city centres. Significantly, heat networks have the potential to expand over time, adding new heat demands and sources — increasing efficiency and carbon savings as they grow. They also eliminate the need for individual boilers or heaters, offering a cost-effective way to reduce carbon emissions from heating.
The Energy Act 2023 introduces a regulatory framework for heat networks, appointing Ofgem as the regulator. Ofgem will implement a licensing regime, monitor compliance, and enforce standards. The Act mandates minimum technical standards, decarbonisation requirements, and fair pricing to protect consumers and ensure reliable, cost-effective, and low-carbon heating.
A significant change is the introduction of heat network “zoning,” allowing local authorities to designate areas best suited for heat networks. Designated zones will mandate certain buildings, such as new builds, large public sector buildings, and existing communal heating buildings, to connect to the network within a specified timeframe. Certain waste heat sources will also be mandated to connect.
Investment in heat networks can stimulate local growth and regeneration. The Green Heat Networks Fund (GHNF) offers £288 million in grants over three years to support new and existing low and zero-carbon heat networks. Open to public, private, and third-sector organisations in England, the GHNF requires applicants to meet specific metrics and provide necessary documentation.
Demystifying the transition to net zero is vital to encourage landlords to support the scale and speed of the shift required. Our guide sets out important insights to help do just that.