England Launches Heat Network Zones with Nearly £6 Million in Government Funding

Six cities in England are set to revolutionize their heating systems by creating the country's first heat network zones. Leeds, Plymouth, Bristol, Stockport, Sheffield, and two areas in London will benefit from a share of £5.8 million in government funding designated for these initiatives. Construction is expected to begin in 2026, promising to generate tens of thousands of jobs across engineering, planning, manufacturing, and construction sectors, thereby fueling economic expansion in these areas.

Heat network zones are planned to be the most economical and efficient way to distribute this technology, which capitalizes on surplus heat from sources such as data centres and factories to heat multiple buildings simultaneously. For example, the network in Leeds will utilize heat from a neighbouring glass factory, and the Old Oak and Park Royal Development in London will employ waste heat from data centres.

These zones will use data to identify the most strategic locations for large-scale planning and development. Well-suited buildings, such as hotels and office complexes, will be encouraged to connect to the network when it is economically feasible, maximizing the benefits throughout the community.

Aecom, in partnership with the Department for Energy Security and Net Zero (DESNZ), has designed the program and will assist in its execution. The projects are anticipated to attract significant private investment and yield £3 for every £1 of public money spent.

Additionally, the government plans to introduce secondary legislation to mandate Ofgem's regulatory supervision over new and existing heat networks, ensuring reasonable pricing and safeguarding vulnerable consumers. This initiative is pivotal in harnessing the full potential of heat networking throughout England and establishing a more sustainable energy framework for the future.

Minister for energy consumers Miatta Fahnbulleh said: “Heat network zones will play an important part in our mission to deliver clean power for the country, helping us take back control of our energy security.

“As well as energy independence, they will support millions of businesses and building owners for years to come, with low-cost, low carbon heating – driving down energy bills.

“Tens of thousands of green jobs will be created across the country, and that’s why we’re investing in developing these fantastic and innovative projects – developing the first zones in cities and towns across England.”

CEO of the Association for Decentralised Energy Caroline Bragg said: “We are delighted to see government maintaining its support for the heat network sector.

“Heat network zones are crucial for a just transition for our communities – putting the UK on the lowest cost pathway to decarbonising our heat, attracting more than £3 of private investment for every £1 of public funding given and creating tens of thousands of local jobs.

“As we begin to deliver zoning at scale, it is crucial that the government and industry continue to work together to ensure heat networks can truly unleash their potential.”

Trevor Hutchings, chief executive at the Association for Renewable Energy and Clean Technology, added: “Today’s commitment to developing the first heat network zones in the UK marks a significant and welcome step in the journey to decarbonise heating. As demonstrated across many European countries, heat networks play a critical role in reducing carbon emissions, lowering consumer costs, and creating local jobs and skills.

“Importantly, these networks can capture low-carbon heat already produced by sources such as biomass and energy-from-waste facilities and harnessing other renewable technologies like deep geothermal heat and networked heat pumps. The REA looks forward to continued collaboration with the government to support the successful delivery of these transformative projects.”