The government is to “expand Great Britain’s network of low carbon heating” with a £19m package.

The investment will go towards setting up five new heat networks, two in Bristol, and three across Liverpool, London and Worthing.

Heat networks supply heat from a central source to consumers, such as large rivers and heat from sewers via a network of underground pipes carrying hot water, like a giant central heating system serving many buildings, and supplies it through pipes to homes and businesses.

The funding comes from the £320m Heat Networks Investment Project (HNIP).

Minister for Climate Change Lord Callanan said: ”Almost a third of all UK carbon emissions come from heating our homes and addressing this is a vital part of tackling pollution, driving down bills and reducing our reliance on costly fossil fuels.

“Today’s announcement builds on our commitments made in the Heat and Buildings Strategy to regulate the UK’s heat networks, protect consumers, and create opportunities for green jobs and investment across the country.

“This will allow thousands of households and businesses to feel the benefits of projects that are breaking new ground and making our villages, towns and cities cleaner places to live and work.”

To support this, Ofgem has been appointed by the UK government as the heat networks regulator for Great Britain to ensure consumers “receive a fair price and reliable supply of heat”.

Jonathan Brearley, chief executive of Ofgem, said: “We welcome the government’s announcement that it will appoint Ofgem as the new heat networks regulator. Heat networks can play a key role in reducing carbon emissions from heating and helping to achieve the country’s climate goals.

“We will work with the government to design a regulatory framework which attracts the investment needed while ensuring heat network consumers, especially those in vulnerable circumstances, receive a fair price and reliable supply of heat for their homes as we make the transition to net zero.”

The government’s response to the Heat networks market framework consultation, sets out proposals for introducing legislation to regulate the sector. This will include appointing Ofgem as heat networks regulator and Citizens Advice as the consumer advocacy body.

This legislation will play a critical role in protecting approximately half a million consumers across around 14,000 heat networks in Great Britain, of which approximately 2,000 are district heat networks and 12,000 are communal heat networks.

The HNIP funded heat network projects announced:

• Royal Borough of Kensington and Chelsea has been awarded over £1.1m to develop a new zero carbon heat network which will use air source heat pumps to provide heat to 826 existing homes and several public buildings and business units in the Notting Dale area of the borough
• Worthing Borough Council has been awarded over £5.3m toward the replacement of gas boilers in 27 buildings with a heat network that will use a centralised heat pump to take heat from the sewer underneath the town.
• Bristol City Council has been awarded a total of over £6.4m to support the development of 2 new low carbon heat networks in the Temple and Bedminster districts. Combined, these networks are expected to deliver heat to over 6,000 residences through the use of ground and water source heat pumps and waste heat from Bristol University’s Temple Quarter Enterprise Campus.
• Peel Energy, through its supply company, Mersey Heat, is delivering a district heat network to the Liverpool Waters development and the surrounding areas. The HNIP funding award of £6.2 million will enable the transition to a heat pump solution as the main generation source and connection of a central cluster of existing buildings. When complete, Mersey Heat will provide low carbon heat and hot water to up to 9,000 homes.