2025 No. 269
Energy
The Heat Networks (Market Framework) (Great Britain) Regulations 2025
Made
2nd March 2025
Coming into force in accordance with regulation 1(2) to (5)
The Secretary of State, in exercise of the powers conferred by sections 217(2), 219(1) and (4), 223(1) and 224 of, and Parts 2, 3, 6, 7 and 11 to 13 of Schedule 18 to, the Energy Act2023, makes the following Regulations.
In accordance with sections 219(7) and 220 of that Act, the Secretary of State has—
(a) consulted such persons or bodies as the Secretary of State considers appropriate; and
(b) given notice to and considered the representations of the Scottish Ministers.
In accordance with sections 217(6), 221(1), 223(2) and 224(5) of that Act, a draft of this instrument was laid before Parliament and approved by a resolution of each House of Parliament.
(1) These Regulations may be cited as the Heat Networks (Market Framework) (Great Britain) Regulations 2025.
(2) The following provisions come into force on the day after the day on which these Regulations are made—
(a) this regulation;
(b) regulation 2 (interpretation);
(c) regulations 4 to 8 (general provisions about Regulator’s functions) in relation to the functions of the Regulator described in the regulations referred to in sub-paragraphs (e) to (i);
(d) regulation 13 (meaning of regulated activity);
(e) regulation 15 (Regulator’s regulations in relation to application for a heat network authorisation);
(f) regulation 18 (general authorisation conditions);
(g) regulation 20 (scope of authorisation conditions) so far as it relates to general authorisation conditions;
(h) Chapter 1 of Part 6 (standards of performance);
(i) regulation 56 (Part 2 of the Consumers, Estate Agents and Redress Act 2007 applied) so far as it confers a power on the GEMA to make regulations under section 43 of the Consumers, Estate Agents and Redress Act 2007 (standards for handling complaints).
(3) The following provisions come into force on 1st April 2025—
(a) regulation 14 (prohibition on carrying on a regulated activity without authorisation);
(b) regulation 26 (initial period);
(c) regulation 27 (deemed heat network authorisations);
(d) paragraphs (1) to (3), (5) and (10) of regulation 54 (Part 1 of the Consumers, Estate Agents and Redress Act 2007 applied);
(e) regulation 55 (certain documents to be sent to Citizens Advice and Consumer Scotland);
(f) paragraphs (9) to (11) of regulation 56.
(4) Except where paragraph (5) applies, the remaining provisions come into force on 27th January 2026 (“the launch date”).
(5) In Part 4 (enforcement of conditions and requirements)—
(a) in regulations 46 (functions with respect to competition) and 47 (procedure for concurrent exercise of functions), the references to section 35C of the Competition Act 1998 come into force on the later of the launch date and the day that paragraph 6 of Schedule 11 to the Digital Markets, Competition and Consumers Act 2024 comes into force;
(b) in regulation 46, the references to section 167C of the Enterprise Act 2002 come into force on the later of the launch date and the day that paragraph 18 of Schedule 11 to the Digital Markets, Competition and Consumers Act 2024 comes into force;
(c) regulation 46(10) comes into force on the later of the launch date and the day that section 327 of the Digital Markets, Competition and Consumers Act 2024 comes into force.
(6) These Regulations, except regulation 68, extend to England and Wales and Scotland.
(7) Regulation 68 (Part 1 of the Heat Networks (Scotland) Act 2021 amended) extends to Scotland only.
In these Regulations—
“applicant” means a person who applies for a heat network authorisation;
“authorisation conditions”, in relation to a heat network authorisation, means any general authorisation conditions or specific authorisation conditions that apply in relation to the heat network authorisation;
“authorised officer” has the meaning given in regulation 49 (inspections);
“authorised person” is to be construed in accordance with regulations 16 (conferral of heat network authorisations) and 27 (deemed heat network authorisations);
“Citizens Advice” means the National Association of Citizens Advice Bureaux;
“Citizens Advice Scotland” means the Scottish Association of Citizens Advice Bureaux;
“consumer” includes a future consumer;
“the court” means , except in Part 7A, the High Court in relation to England and Wales and the Court of Session in relation to Scotland;
“delegate”, in relation to the Regulator, has the meaning given in regulation 5 (power for the Regulator to delegate functions);
“general authorisation conditions” means conditions that have effect as such by virtue of regulation 18 (general authorisation conditions);
“heat network administration order” has the meaning given in regulation 59B;
“heat network administrator” has the meaning given in regulation 59B;
“heat network consumer” means a consumer in relation to heating, cooling or hot water supplied by means of a relevant heat network, including a person who takes a supply of heating, cooling or hot water from one relevant heat network for the purpose of supplying another;
“initial period” and “first part of the initial period” have the meanings given in regulation 26 (initial period);
“launch date” means 27th January 2026;
“modification”, in relation to authorisation conditions, means—
the revocation or amendment of an existing authorisation condition;
the addition of a new authorisation condition;
“regulated activity” has the meaning given by regulation 13 (meaning of regulated activity);
“Regulator” is to be construed in accordance with regulation 4 (specified functions to be carried out by the Secretary of State);
“the Regulator’s regulations” means regulations made by the Regulator under regulation 15 (Regulator’s regulations in relation to application for a heat network authorisation);
“relevant requirement” has the meaning given by paragraph 37(6) of Schedule 18 to the Energy Act 2023 except that, for the purposes of regulations 37 to 44 (consumer redress orders), it does not include standards of performance prescribed or determined under Chapter 1 of Part 6 (standards of performance);
“specific authorisation conditions” means conditions determined by the Regulator under regulation 19 (specific authorisation conditions).
2A Regulations do not apply to certain communal heat networks providing air-conditioning
(1) These Regulations do not apply to a communal heat network by means of which cooling is supplied if—
(a) cooling, and any heating supplied by means of the network, are provided only by air-conditioning; and
(b) hot water is not supplied by means of the network.
(2) Accordingly, in these Regulations, “relevant heat network” does not include a communal heat network referred to in paragraph (1).
4 Specified functions to be carried out by the Secretary of State
(1) Without prejudice to the generality of regulation 18 (general authorisation conditions) as regards the Secretary of State’s powers, the Secretary of State and not the GEMA has the function of determining and enforcing general authorisation conditions related to accuracy of heat meters, and references to “the Regulator” are to be construed accordingly.
(2) In this regulation, “heat meter” means an instrument designed to measure, memorise and display the consumption of heating, cooling or hot water by a heat network consumer.
(1) The Regulator may, with the agreement of another person, delegate to that person (“the delegate”) any function conferred on the Regulator by these Regulations other than a function conferred by regulation 49 (inspections).
(2) A delegation other than by the Secretary of State may only be made with the Secretary of State’s permission.
(3) A delegation must—
(a) be in writing; and
(b) specify—
(i) the functions which are delegated to the delegate; and
(ii) any duties and objectives which apply to the delegate when carrying out the delegated functions.
(4) A person carrying out a delegated function must comply with any duties specified in the delegation.
(1) The principal objective of the Regulator in carrying out its functions under these Regulations is to protect the interests of heat network consumers.
(2) Those interests are their interests taken as a whole, including—
(a) their interests in the reliability of the supply of heating, cooling or hot water;
(b) their interests in the Secretary of State’s compliance with the duties in sections 1 and 4(1)(b) of the Climate Change Act 2008 (net zero target for 2050 and five-year carbon budgets);
(c) their interests in charges for the supply of heating, cooling or hot water being proportionate;
(d) their interests in information about services and charges being communicated plainly.
(3) References in this regulation and in regulations 7 (general duties of the Regulator) and 8 (duty of the Regulator and others to have regard to interests of consumers) to functions of the Regulator under these Regulations include references to any functions of the GEMA under section 5A of the Utilities Act 2000 that are exercisable in relation to a proposal to do anything for the purposes of, or in connection with, the carrying out of any function of the GEMA under these Regulations.
(1) The Regulator or a delegate of the Regulator must—
(a) carry out its functions under these Regulations in a manner best calculated to further the principal objective of the Regulator;
(b) when carrying out its functions under these Regulations, consider the need to ensure that persons carrying on a regulated activity under a heat network authorisation are able to finance obligations imposed by or under these Regulations;
(c) when complying with the duty in sub-paragraph (a) or (b), have regard to the interests of heat network consumers who are in vulnerable circumstances.
(2) The duty in paragraph(1)(a) includes a duty to promote effective competition between persons engaged in—
(a) the operation of a relevant heat network;
(b) the supply of heating, cooling or hot water to heat network consumers by means of a relevant heat network;
(c) commercial activities connected with the supply of heating, cooling or hot water to heat network consumers by means of a relevant heat network.
(1) The Regulator or a delegate of the Regulator, in carrying out a function under these Regulations, may have regard to the interests of consumers in relation to—
(a) electricity conveyed by distribution systems or transmission systems (within the meaning of the Electricity Act 1989);
(b) gas conveyed through pipes (within the meaning of the Gas Act 1986);
(c) communications services and electronic communications apparatus which are affected by the carrying out of that function;
(d) water services or sewerage services (within the meaning of the Water Industry Act 1991) which are affected by the carrying out of that function.
(2) A person or body exercising a regulatory function in a field mentioned in any sub-paragraph of paragraph(1) may have regard to the interests of heat network consumers.
(1) The Regulator must keep under review the carrying on of regulated activities in relation to relevant heat networks in Great Britain.
(2) The Regulator must, so far as it appears to it to be practicable from time to time to do so, monitor the carrying on of the activities mentioned in paragraph (1), and the persons by whom they are carried on, with a view to facilitating the exercise of its functions under these Regulations.
(1) To enable the Regulator to comply with the duty in regulation 9 (monitoring and review), the Regulator may, by notice served on a person within paragraph 10(2), require that person to provide in the form and manner specified in the notice—
(a) documents specified or described in the notice that are in that person’s custody or under that person’s control;
(b) information specified or described in the notice that relates to matters the Regulator is under a duty to monitor.
(2) A notice under paragraph (1) may be served on—
(a) a person carrying on a regulated activity;
(b) a person which, in relation to a person carrying on a regulated activity, is an interconnected body corporate within the meaning of section 129(2) of the Enterprise Act 2002.
(3) The notice must specify the time and place at which the person must provide the documents or information to the Regulator.
(1) The Regulator must maintain records of information obtained under or by virtue of these Regulations relating to—
(a) persons on whom a heat network authorisation has been conferred;
(b) persons whose application for a heat network authorisation has been refused;
(c) persons whose heat network authorisation has been revoked.
(2) The Regulator is not required to maintain any records referred to in paragraph (1) for longer than it considers appropriate having regard to the nature of the records and the purposes for which they may lawfully be used or disclosed by the Regulator.
(3) This regulation does not affect the operation of the Public Records Act 1958 or the data protection legislation (within the meaning of the Data Protection Act2018).
12 Publication of advice, guidance, information and list of authorised persons by the Regulator
(1) If it appears to the Regulator that the publication of any advice, guidance or information would promote the interests of heat network consumers, the Regulator may publish that advice, guidance or information in such manner as it thinks fit.
(2) In publishing advice, guidance or information under paragraph (1), the Regulator must have regard to the need for excluding, so far as that is practicable, any matter which relates to the affairs of a particular individual or body of persons (corporate or unincorporate), where publication of that matter would or might, in the opinion of the Regulator, seriously and prejudicially affect the interests of that individual or body.
(3) Before deciding to publish under paragraph (1) any advice, guidance or information relating to a particular individual or body of persons the Regulator must consult that individual or body.
(4) The Regulator must publish a list of authorised persons with, for each—
(a) the regulated activities carried on by the authorised person; and
(b) the geographical location of the relevant heat network in relation to which the regulated activities are carried on by the authorised person.
(1) Subject to paragraph (2), “regulated activity” means—
(a) operating a relevant heat network;
(b) supplying heating, cooling or hot water to heat network consumers by means of a relevant heat network.
(2) But an activity described in paragraph (1) is not a regulated activity if—
(a) the heat network only serves a single house in multiple occupation; or
(b) where sub-paragraph (a) does not apply, the heat network—
(i) only serves a single converted building as defined in section 254(8) of the Housing Act 2004; and
(ii) has no more than one source appliance and that appliance has a capacity of no more than 45 kilowatt thermal.
(3) For the purposes of paragraphs (1) and (2), a person operates a relevant heat network if the person controls the transfer on that network of thermal energy for the purposes of supplying heating, cooling or hot water.
(4) If applying paragraph (3) identifies more than one person as operating a relevant heat network—
(a) where only one person is entitled to make decisions about modifying the network, that person is taken to operate it;
(b) if different persons are entitled to make decisions about modifying different parts of the network, each is taken to operate it but only in respect of the relevant part.
(5) In this regulation—
“house in multiple occupation” means a building or a part of a building within any of paragraphs (a) to (d) of subsection (1) of section 254 of the Housing Act 2004 (or that would be within any of those paragraphs if section 254 extended to Scotland);
“source appliance”, in relation to a relevant heat network, means an appliance the main purpose of which is to heat or cool the liquid or gas that is distributed in the network.
14 Prohibition on carrying on a regulated activity without authorisation
A person must not carry on a regulated activity, except as permitted by virtue of a heat network authorisation (but see regulation 27 which provides for deemed heat network authorisations).
15 Regulator’s regulations in relation to application for a heat network authorisation
(1) The Regulator must prescribe one or more of the following—
(a) the form in which an application for a heat network authorisation (“application”), including an application within regulation 24 (transfer of heat network authorisations), is to be submitted to the Regulator;
(b) information that must be contained in an application including any supporting documents;
(c) the manner in which an application and any supporting documents are to be submitted to the Regulator;
(d) the fee which is to accompany an application.
(2) In this regulation, “prescribe” means prescribe in regulations made by statutory instrument.
(1) The Regulator may confer a heat network authorisation on an applicant if the application is made in accordance with the Regulator’s regulations.
(2) A heat network authorisation authorises the person on whom it is conferred (“an authorised person”) to carry on one or more regulated activities specified in the authorisation in relation to one or more relevant heat networks specified in the authorisation.
(3) Where an applicant is already an authorised person, the Regulator may confer the heat network authorisation applied for by modifying a heat network authorisation already held by the applicant (“the existing authorisation”).
(4) The Regulator may make such modifications to the existing authorisation as the Regulator considers appropriate in connection with the conferral of the heat network authorisation applied for.
(5) A heat network authorisation must include the applicable general authorisation conditions and may include specific authorisation conditions.
(6) An authorisation condition included in a heat network authorisation has effect or ceases to have effect—
(a) at such times and in such circumstances as may be determined by or under the condition; and
(b) subject to any modification of the condition.
(7) A heat network authorisation conferred under this regulation remains in force except to the extent that it is modified or revoked or otherwise ceases to have effect under this Part.
(1) The Regulator may confer a heat network authorisation on an applicant on a temporary basis for a specified period (“temporary authorisation”) where it requires more time to determine—
(a) how to exercise its discretion under regulation 16(1) (conferral of heat network authorisations); or
(b) whether the heat network authorisation should contain specific authorisation conditions.
(2) A temporary authorisation ceases to have effect at the end of the specified period or, if earlier—
(a) on the day that a heat network authorisation other than the temporary authorisation takes effect in relation to the same regulated activities and the same relevant heat network as are specified in the temporary authorisation;
(b) at the end of the period of 14 days beginning with the day after the day on which the Regulator gives notice refusing to confer a heat network authorisation in relation to the same regulated activities and the same relevant heat network as are specified in the temporary authorisation; or
(c) on the day on which the revocation of the temporary authorisation under regulation 25 (review and revocation of heat network authorisations) has effect.
(3) In this regulation, “specified period” means a period specified in the temporary authorisation.
(1) A regulatory authority may determine conditions to be included in—
(a) each heat network authorisation;
(b) each heat network authorisation of a particular description.
(2) Any conditions determined by a regulatory authority under paragraph (1) must be set out in a notice published in such manner as the regulatory authority considers appropriate for the purpose of bringing the conditions to the attention of persons likely to be affected by them.
(3) The conditions have effect as general authorisation conditions from the date specified for that purpose in the notice under paragraph (2) for the purpose of—
(a) regulation 16(5) (conferral of heat network authorisations);
(b) regulation 27(4) and (5) (deemed heat network authorisations),
but, subject to regulation 27(5), any modification of general authorisation conditions in relation to heat network authorisations already conferred must take place in accordance with regulations 21 (procedure for modifying general authorisation conditions) and, if applicable, 23 (modification of conditions under regulation 21 or 22: early effective date).
(4) Before determining any general authorisation conditions, a regulatory authority must—
(a) set out the proposed conditions in a notice published in such manner as the regulatory authority considers appropriate for the purpose of bringing the proposed conditions to the attention of persons likely to be affected by them; and
(b) consult with such persons or bodies as it considers appropriate on the proposed conditions.
(5) The requirements of this regulation may be satisfied by action taken before these Regulations are made.
(6) Conditions determined under this regulation may not take effect before the launch date.
(7) In this regulation, “regulatory authority” means the Regulator or the Secretary of State.
(1) The Regulator may determine conditions to be included in a particular heat network authorisation that are specific to that authorisation (“specific authorisation conditions”).
(2) The Regulator must send to the authorised person any specific authorisation conditions that apply to that person.
(1) General authorisation conditions or specific authorisation conditions may include—
(a) conditions whose object is to limit the number of persons authorised as operators of a single relevant heat network or, in relation to a relevant heat network which has more than one person authorised to operate it, to facilitate the exercise of the functions of—
(i) the Regulator;
(ii) Citizens Advice, Citizens Advice Scotland or Consumer Scotland; or
(iii) the operator of a redress scheme for the purposes of section 47 of the Consumers, Estate Agents and Redress Act 2007 as applied by regulation 56(7) of these Regulations;
(b) conditions about the terms on which premises are connected to , or supplied by means of, a relevant heat network;
(c) conditions requiring an authorised person to make an offer of connection or supply to premises when asked to do so by the owner, occupier or a party acting on their behalf;
(d) conditions about installing and maintaining , and the operation of, equipment for measuring, displaying, recording and regulating consumption of heating, cooling and hot water supplied by means of a relevant heat network;
(e) conditions about—
(i) the charges payable by heat network consumers, including—
(aa) a condition that an authorised person must not charge domestic heat network consumers an amount that exceeds a specified price cap;
(bb) a condition that an authorised person must not impose on heat network consumers charges that are disproportionate;
(ii) the billing of heat network consumers, including—
(aa) a condition that imposes requirements about the bills given to heat network consumers (including requirements about their frequency, accuracy and the use of estimates);
(bb) a condition that imposes requirements about the information and explanatory material to be provided to heat network consumers;
(cc) a condition that makes provision about the charges that may be made in respect of the costs of providing bills and such information and explanatory material;
(iii) service standards (including standards for handling complaints);
(iv) the communication of information about the heat network, the services provided or the terms on which the services are provided;
(v) the conduct of authorised persons towards heat network consumers or in relation to premises connected, or proposed to be connected, to a relevant heat network, including—
(aa) a condition about conduct if payments relating to the supply of heating, cooling or hot water are not made (including restricting when premises may be disconnected);
(bb) a condition requiring credit to be provided to heat network consumers with pre-payment meters;
(f) conditions relating to price regulation (including by means of regulation of charges or profits);
(g) conditions about complying with technical standards including technical standards (including those for which provision is made in a designated document relating to—
(i) the design, construction, commissioning, operation or maintenance of a relevant heat network;
(ii) the decommissioning of a relevant heat network;
(iii) equipment or materials used in the construction, operation or maintenance of a relevant heat network;
(iv) the competence of persons engaged in the design, construction, commissioning, operation or maintenance of a relevant heat network;
(h) conditions about ensuring the continuity of the supply of heating, cooling and hot water to heat network consumers;
(i) conditions about providing information to the Regulator, including a requirement to notify the Regulator of any material change in the operation of a relevant heat network or the supply of heating, cooling or hot water;
(j) conditions about the payment of fees to the Regulator, including conditions about the payment of fees—
(i) in connection with the conferring of an authorisation;
(ii) while an authorisation continues to be in force in relation to a person;
(ja) conditions requiring an authorised person to comply with the provisions of a designated document;
(jb) conditions—
(i) requiring an authorised person to pay such sums relating to the costs of a heat network administration order as may be determined by the Secretary of State under the conditions to such persons as may be so determined for the purpose of—
(aa) enabling the Secretary of State to recover losses and expenses referred to in paragraph (5)(a);
(bb) reducing or discharging obligations referred to in paragraph (5)(b);
(ii) requiring or enabling an authorised person to modify the charges on heat network consumers imposed by the authorised person so as to raise those sums;
(iii) requiring the sums so raised to be held on trust pending payment;
(k) such other conditions as appear to the Regulator or, when determining conditions under regulation 18, the Secretary of State to be requisite or expedient having regard to the principal objective established in regulation 6 (principal objective of the Regulator) and the duties established in regulations 7 (general duties of the Regulator) and 8 (duty of the Regulator to have regard to interests of consumers).
(2) Conditions under paragraph (1)(j) may include provision for payment of fees to the Regulator under regulation 57 (expenses relating to consumer advocacy and advice).
(3) General authorisation conditions or specific authorisation conditions may require the authorised person—
(a) to comply with any direction given by the Regulator or the Secretary of State in relation to any specified matter or description of matter;
(b) not to do or to do any specified thing or description of thing, except so far as the thing is done or not done with the consent of the Regulator or the Secretary of State;
(c) to refer for determination by the Regulator or the Secretary of State any specified question or description of question arising under the heat network authorisation;
(d) to refer for approval by the Regulator or the Secretary of State—
(i) any thing specified as falling to be done under the heat network authorisation; and
(ii) any specified contract or agreement made before the conferral of the heat network authorisation.
(3A) For the purpose of a condition referred to in paragraph (1)(e)(i)(bb) (disproportionate charges), the Regulator—
(a) may from time to time specify the methods that are to be used by the Regulator to determine whether charges are disproportionate; and
(b) must publish them in such manner as the Regulator thinks appropriate.
(4) In this regulation, “specified” means specified in the condition.
(5) For the purpose of this regulation, the costs of a heat network administration order are—
(a) losses and expenses—
(i) that are incurred by the Secretary of State in, as a result of or in connection with giving relevant financial assistance—
(aa) to, or in respect of, a company that is or was subject to the order; or
(bb) otherwise in connection with the order; and
(ii) that the Secretary of State does not expect to recover (except by means of an authorisation condition);
(b) obligations of the company subject to the order to make payments—
(i) in respect of the expenses or remuneration of the heat network administrator of the company;
(ii) in discharge of a debt or liability of the company arising out of a contract entered into by the heat network administrator at a time when the order was in force;
(iii) in respect of interest on relevant financial assistance or any expenses, remuneration, debt or liability referred to in paragraph (i) or (ii),
to the extent that the property of the company available to pay them is insufficient.
(6) In paragraph (5), “relevant financial assistance” means any of the following—
(a) a grant or loan given under section 165 of the Energy Act 2004, as applied by regulation 59D;
(b) a sum paid by the Secretary of State in consequence of an indemnity given under section 166 of that Act, as so applied;
(c) a sum paid out by the Secretary of State under a guarantee given under section 167 of that Act, as so applied.
21 Procedure for modifying general authorisation conditions
(1) Subject to regulation 27(5) (deemed heat network authorisations), the Regulator must give notice of any proposed modification to general authorisation conditions by publishing, in such manner as the Regulator considers appropriate for the purpose of bringing it to the attention of persons likely to be affected by it, a notice setting out—
(a) the proposed modification and its effect; and
(b) the reasons why the Regulator proposes to make the modification.
(2) A copy of the notice published under paragraph (1) must be sent to the Secretary of State and to each authorised person known by the Regulator to be affected by the proposed modification at the same time as the notice is published.
(3) A notice published under paragraph (1) must specify the time within which representations with respect to the proposed modification may be made (“the specified time”).
(4) The specified time may not be less than 28 days beginning with the date the notice is published.
(5) The Regulator must consider any representations which are made within the specified time.
(6) The Regulator must comply with a direction of the Secretary of State not to make a modification if the direction is made within the specified time.
(7) Where the Regulator has complied with paragraphs (1) to (5), and decides to proceed with the making of a modification, the Regulator must publish notice of the decision in such manner as the Regulator considers appropriate for the purpose of bringing it to the attention of persons likely to be affected by it.
(8) A notice published under paragraph (7) must—
(a) set out the modification and its effect;
(b) state how the Regulator has taken account of any representations duly made; and
(c) state the reason for any differences between the modification and the proposed modification.
(9) The modification has effect from the date specified in the notice in relation to it (“date of effect”).
(10) The date of effect may not be earlier than the day falling 28 days after the date the notice under paragraph (7) is published.
(11) Paragraph (2), so far as it comprises an obligation to send a notice to the Secretary of State, and paragraph (6) do not apply to the extent that the Regulator is the Secretary of State.
22 Procedure for modifying specific authorisation conditions
(1) The Regulator must give notice of any proposed modification to specific authorisation conditions by sending a notice to the person whose heat network authorisation includes the conditions (“the relevant authorised person”).
(2) The notice required by paragraph (1) must specify the time within which representations with respect to the proposed modification may be made (“the specified time”).
(3) The specified time may not be less than 28 days beginning with the date the notice is given.
(4) The Regulator must consider any representations which are made within the specified time.
(5) Where the Regulator has complied with paragraphs (1) to (4), and decides to proceed with the making of a modification, the Regulator must send a notice to the relevant authorised person.
(6) The notice required by paragraph (5) must—
(a) set out the modification and its effect;
(b) state how the Regulator has taken account of any representations duly made; and
(c) state the reason for any differences between the modification and the proposed modification.
(7) The modification has effect from the date specified in the notice in relation to it (“date of effect”).
(8) The date of effect may not be earlier than the day falling 28 days after the date the notice under paragraph (5) is sent.
23 Modification of conditions under regulation 21 or 22: early effective date
(1) The date specified by virtue of regulation 21(9) or 22(7) in relation to a modification under that regulation may fall before the end of the usual stand-still period if—
(a) the Regulator considers it necessary or expedient for the modification to have effect from a date before the end of the usual stand-still period; and
(b) the consultation condition is satisfied.
(2) The consultation condition is that the notice under regulation 21(1) or 22(1), as the case may be, relating to the modification—
(a) stated the date from which the Regulator proposed that the modification should have effect;
(b) stated the Regulator’s reasons for proposing that the modification should have effect from a date before the end of the usual stand-still period; and
(c) explained why, in the Regulator’s view, that would not have a material adverse effect on any authorised person.
(3) In this regulation, “the end of the usual stand-still period” means the day falling 28 days after the date the notice under regulation 21(7) is published or the day falling 28 days after the date the notice under regulation 22(5) is sent, as the case may be.
23A Costs of heat network administration orders: Secretary of State may modify authorisation conditions
(1) The Secretary of State may make modifications to authorisation conditions to add, amend or revoke conditions referred to in regulation 20(1)(jb) (costs of heat network administration order).
(2) For the purpose of paragraph (1), regulations 21 or, as the case may be, 22 and 23 apply as if references in those regulations to the Regulator were references to the Secretary of State.
(3) This regulation does not limit the Regulator’s powers under regulation 21 or 22.
(1) This regulation applies where—
(a) a person (“the new entity”) applies for authorisation to carry on a regulated activity in relation to a relevant heat network or is taken to have so applied by virtue of paragraph (2);
(b) the regulated activity has been carried on in relation to the relevant heat network under a heat network authorisation (“the existing authorisation”) which has not been revoked;
(c) the new entity has complied with any applicable Regulator’s regulations; and
(d) the Regulator determines that the holder of the existing authorisation (“the transferring entity”) has consented to the transfer of the existing authorisation so far as it relates to the regulated activity and the relevant heat network mentioned in sub-paragraph (a).
(2) Where a person has agreed to carry on a regulated activity in relation to a relevant heat network at the request of the Regulator, the person is taken to have applied to do so for the purposes of this regulation.
(3) Where this regulation applies the Regulator may transfer the existing authorisation in whole or in part to the new entity.
(4) Where the Regulator transfers the existing authorisation, the Regulator must give notice to the new entity and the transferring entity setting out the extent to which the existing authorisation is being transferred and when the transfer takes effect.
(5) The Regulator may make such modifications to authorisations held by the transferring entity or the new entity as the Regulator considers appropriate to take account of the transfer and such modifications may affect—
(a) the existing authorisation to the extent it is transferred to the new entity;
(b) the existing authorisation to the extent it continues to be held by the transferring entity;
(c) any other authorisation held by the new entity.
25 Review and revocation of heat network authorisations
(1) The Regulator may review the conditions of, or the regulated activities carried out by virtue of, a heat network authorisation at any time while it is in force.
(2) The Regulator may revoke a heat network authorisation in whole or in part in the circumstances specified in or determined under the authorisation conditions.
(3) A heat network authorisation ceases to have effect in whole or in part in the circumstances specified in or determined under the authorisation conditions.
(1) In these Regulations, subject to paragraph (2)—
“first part of the initial period” means the period beginning on the day on which regulation 14 comes into force and ending on the day before the first anniversary of the launch date;
“initial period” means the period beginning on the day on which regulation 14 comes into force and ending on the day before the second anniversary of the launch date.
(2) The Regulator may prolong the first part of the initial period or the initial period with the consent of the Secretary of State.
(3) The Regulator must give notice to the Secretary of State of a proposal to prolong the first part of the initial period or the initial period, giving reasons.
(4) Notice under paragraph (3) must be given no later than one month before the end of the period the Regulator proposes to extend.
(5) The Regulator must publish notice of a decision to prolong the first part of the initial period or the initial period in such manner as the Regulator considers appropriate for the purpose of bringing it to the attention of persons likely to be affected by it.
(1) A person who carries on a regulated activity in relation to a relevant heat network before the end of the first part of the initial period is to be treated as holding a heat network authorisation in relation to that activity and that relevant heat network during the initial period, with the heat network authorisation treated as conferred on the later of—
(a) the day that regulation 14 comes into force; and
(b) the day when the person first carries on that activity in relation to that relevant heat network.
(2) If a person is carrying on a regulated activity in relation to a relevant heat network when regulation 14 comes into force, the heat network authorisation treated as conferred on that person in relation to that activity and that relevant heat network remains in force after the initial period except to the extent that it is modified or revoked or otherwise ceases to have effect under this Part.
(3) References in these Regulations to “authorised person” are to be construed in accordance with paragraphs (1) and (2).
(4) The heat network authorisation treated as conferred by virtue of paragraph (1) includes the general authorisation conditions (if any) that would have been included had the heat network authorisation been conferred under regulation 16.
(5) A heat network authorisation treated as conferred before the launch date is to be treated as modified on the launch date to include the general authorisation conditions that would have been included had the heat network authorisation been conferred under regulation 16 on the launch date.
(1) This regulation applies to authorised persons who carry on a regulated activity referred to in regulation 13(1)(b) (supplying heating, cooling or hot water to a heat network consumer by means of a relevant heat network).
(2) Where premises are supplied with heating, cooling or hot water by an authorised person without agreement as to the terms on which the supply is made, the authorised person is deemed to have made a contract for the supply (a “deemed contract”) with the occupier or, if the premises are unoccupied, the owner as from the relevant time.
(3) The “relevant time” is the time the supply begins or, if the supply begins before this regulation comes into force, 27th January 2026.
(4) A deemed contract must be treated as incorporating the express terms and conditions determined under a scheme made under paragraph (5).
(5) Except where it is reasonably expected that paragraph (2) will not apply, each authorised person must make, and may from time to time revise, a scheme for determining the express terms and conditions of a deemed contract.
(6) The terms and conditions determined under a scheme—
(a) may include terms and conditions to enable the authorised person to determine, in any case where the meter (if any) is not read immediately before the relevant time, the quantity of heating, cooling or hot water to be treated as supplied to, or consumed at, the premises during the period beginning with the relevant time and ending with the earlier of—
(i) the time when the meter is first read after the relevant time; and
(ii) the time when the authorised person ceases to supply heating, cooling or hot water to the premises;
(b) must provide that the charges payable for the supply are no higher than those payable under the authorised person’s applicable standard variable supply contract;
(c) must comply with the authorisation conditions of the authorised person’s heat network authorisation.
(7) A scheme may make different provisions for different cases or classes of cases, or for different areas, determined by, or in accordance with, the provisions of the scheme.
(8) As soon as reasonably practicable after an authorised person makes or revises a scheme, the authorised person must—
(a) publish, in such manner as the authorised person considers appropriate for bringing it to the attention of persons likely to be affected by it, a notice stating the effect of the scheme or the revised scheme; and
(b) send a copy of the scheme or the revised scheme to the Regulator, Citizens Advice and Consumer Scotland.
(9) If requested to do so by, or on behalf of, a heat network consumer supplied by means of the relevant heat network to which an authorised person’s heat network authorisation relates, the authorised person must, without charge, send a copy of a scheme or a revised scheme to the person making the request.
(1) Where the Regulator is satisfied that an authorised person is contravening or is likely to contravene an authorisation condition or a relevant requirement, it must by final order make such provision as is requisite for the purpose of securing compliance with that condition or requirement.
(2) Where it appears to the Regulator that an authorised person is contravening or is likely to contravene an authorisation condition or a relevant requirement and that it is requisite that a provisional order be made, it must (instead of taking steps towards the making of a final order) by a provisional order make such provision as appears to it requisite for the purpose of securing compliance with that condition or requirement.
(3) In determining whether it is requisite that a provisional order be made, the Regulator must have regard in particular—
(a) to the extent to which any person is likely to sustain loss or damage in consequence of anything which, in contravention of the authorisation condition or relevant requirement, is likely to be done, or omitted to be done, before a final order may be made; and
(b) to the fact that the effect of the provisions of this regulation and regulation 30 (validity and effect of orders) is to exclude the availability of any remedy (apart from under those provisions or for negligence) in respect of any contravention of the authorisation condition or relevant requirement.
(4) The Regulator must confirm a provisional order with or without modifications if—
(a) it is satisfied that the authorised person is contravening or is likely to contravene an authorisation condition or a relevant requirement; and
(b) the provision made by the order (with any modifications) is requisite for the purpose of securing compliance with that condition or requirement.
(5) Before making a final order or making or confirming a provisional order, the Regulator must consider whether it would be more appropriate to proceed under the Competition Act 1998.
(6) The Regulator must not make a final order or make or confirm a provisional order if it considers that it would be more appropriate to proceed under the Competition Act 1998.
(7) The Regulator must not make a final order or make or confirm a provisional order in relation to an authorised person if it is satisfied that the duties imposed by regulation 7 (general duties of the Regulator) preclude the making or confirmation of the order.
(8) The Regulator is not required to make a final order or make or confirm a provisional order if it is satisfied—
(a) that the authorised person has agreed to take and is taking all such steps as it appears to the Regulator for the time being to be appropriate for the authorised person to take for the purpose of securing or facilitating compliance with the condition or requirement; or
(b) that the contraventions were, or the apprehended contraventions are, of a trivial nature.
(9) Where the Regulator decides that it would be more appropriate to proceed under the Competition Act 1998 or is satisfied as mentioned in paragraphs (7) or (8), it must—
(a) serve notice that it has so decided or is so satisfied on the authorised person; and
(b) publish the notice in such manner as it considers appropriate for the purpose of bringing the matters to which the notice relates to the attention of persons likely to be affected by them.
(10) A final or provisional order—
(a) must require the authorised person to whom it relates to do, or not to do, such things as are specified in the order or are of a description so specified;
(b) must take effect at such time, being the earliest practicable time, as is determined by or under the order; and
(c) may be revoked at any time by the Regulator.
(11) In this Part—
(a) “final order” means an order under this regulation other than a provisional order;
(b) “provisional order” means an order under this regulation which, if not previously confirmed, will cease to have effect at the end of such period (not exceeding 12 months) as is determined by or under the order.
(1) Before it makes a final order or confirms a provisional order, the Regulator must give notice—
(a) stating that it proposes to make or confirm the order and setting out its effect;
(b) setting out—
(i) the condition or relevant requirement for the purpose of securing compliance with which the order is to be made or confirmed;
(ii) the acts or omissions which, in its opinion, constitute or would constitute contraventions of that condition or requirement; and
(iii) the other facts which, in its opinion, justify the making or confirmation of the order; and
(c) specifying the period (not being less than 21 days beginning with the date of publication of the notice) within which representations or objections with respect to the proposed order or proposed confirmation may be made,
and must consider any representations or objections which are duly made and not withdrawn.
(2) A notice under paragraph (1) must be given—
(a) by publishing the notice in such manner as the Regulator considers appropriate for the purpose of bringing the matters to which the notice relates to the attention of persons likely to be affected by them; and
(b) by serving a copy of the notice, and a copy of the proposed order or of the order proposed to be confirmed, on the authorised person to whom the order relates (“the authorised person”).
(3) The Regulator must not make a final order with modifications, or confirm a provisional order with modifications, except—
(a) with the authorised person’s consent to the modifications; or
(b) after complying with the requirements of paragraph (4).
(4) The requirements are that the Regulator must—
(a) serve on the authorised person such notice as appears to it requisite of the proposal to make or confirm the order with modifications;
(b) in that notice specify the period (not being less than 21 days beginning with the date of the service of the notice) within which representations or objections with respect to the proposed modifications may be made; and
(c) consider any representations or objections which are duly made and not withdrawn.
(5) As soon as practicable after making a final order or making or confirming a provisional order, the Regulator must—
(a) serve a copy of the order on the authorised person; and
(b) publish the order in such manner as it considers appropriate for the purpose of bringing it to the attention of persons likely to be affected by it.
(6) Before revoking a final order or a provisional order which has been confirmed, the Regulator must give notice—
(a) stating that it proposes to revoke the order and setting out its effect; and
(b) specifying the period (not being less than 28 days beginning with the date of publication of the notice) within which representations or objections with respect to the proposed revocation may be made,
and must consider any representations or objections which are duly made and not withdrawn.
(7) If, after giving a notice under paragraph (6), the Regulator decides not to revoke the order to which the notice relates, it must give notice of its decision.
(8) A notice under paragraph (6) or (7) must be given—
(a) by publishing the notice in such manner as the Regulator considers appropriate for the purpose of bringing the matters to which the notice relates to the attention of persons likely to be affected by them; and
(b) by serving a copy of the notice on the authorised person.
(1) An authorised person to whom a final or provisional order relates who is aggrieved by the order and desires to question its validity on the ground—
(a) that its making or confirmation was not within the powers of regulation 28; or
(b) that any of the requirements of regulation 29 have not been complied with in relation to it,
may, within 42 days beginning with the date of service on the person of a copy of the order, make an application to the court under this regulation.
(2) On any such application the court may, if satisfied that the making or confirmation of the order was not within those powers or that the interests of the authorised person have been substantially prejudiced by a failure to comply with those requirements, quash the order or any provision of the order.
(3) Except as provided by this regulation, the validity of a final or provisional order must not be questioned by any legal proceedings whatever.
(4) The obligation to comply with a final or provisional order is a duty owed to any person who may be affected by a contravention of the order.
(5) Where a duty is owed by virtue of paragraph (4) to any person, any breach of the duty which causes that person to sustain loss or damage is actionable at the suit or instance of that person.
(6) In any proceedings brought against an authorised person under paragraph (5), it is a defence for the person to prove that the person took all reasonable steps and exercised all due diligence to avoid contravening the order.
(7) Without prejudice to any right which any person may have by virtue of paragraph (5) to bring civil proceedings in respect of any contravention or apprehended contravention of a final or provisional order, compliance with any such order is enforceable by civil proceedings by the Regulator for an injunction or for interdict or for any other appropriate relief.
(1) This regulation applies where the Regulator is satisfied that an authorised person has contravened or is contravening an authorisation condition or a relevant requirement.
(2) The Regulator may impose a penalty on the authorised person of such amount as is reasonable in all the circumstances of the case.
(3) The Regulator’s discretion under paragraph (2) is subject to regulation 45 (maximum amount of penalty or compensation).
(4) The Regulator must have regard to any relevant statement of policy when deciding—
(a) whether to impose a penalty; and
(b) the amount of a penalty.
(5) A relevant statement of policy is a statement of policy or revised statement of policy published under regulation32 (requirement to publish statement of policy with respect to penalties) which applies at the time when the contravention occurred.
(6) Before imposing a penalty on an authorised person under paragraph (2), the Regulator must consider whether it would be more appropriate to proceed under the Competition Act 1998.
(7) The Regulator must not impose a penalty on an authorised person under paragraph (2) if it considers that it would be more appropriate to proceed under the Competition Act 1998.
(8) Before imposing a penalty on an authorised person under paragraph (2), the Regulator must give notice—
(a) stating that it proposes to impose a penalty and the amount of the penalty proposed to be imposed;
(b) setting out the relevant condition or requirement in question;
(c) specifying the acts or omissions which, in the opinion of the Regulator, constitute the contravention and the other facts which, in the opinion of the Regulator, justify the imposition of a penalty and the amount of the penalty proposed; and
(d) specifying the period (not being less than 21 days beginning with the date of publication of the notice) within which representations or objections with respect to the proposed penalty may be made.
(9) Before imposing a penalty, the Regulator must consider any representations or objections which are duly made under paragraph (8) and not withdrawn.
(10) Before varying any proposal stated in a notice under paragraph (8)(a), the Regulator must give notice—
(a) setting out the proposed variation and the reasons for it; and
(b) specifying the period (not being less than 21 days beginning with the date of publication of the notice) within which representations or objections with respect to the proposed variation may be made.
(11) Before varying a proposal, the Regulator must consider any representations or objections which are duly made under paragraph (10) and not withdrawn.
(12) As soon as practicable after imposing a penalty, the Regulator must give notice—
(a) stating that it has imposed a penalty on the authorised person and its amount;
(b) setting out the relevant condition or requirement in question;
(c) specifying the acts or omissions which, in the opinion of the Regulator, constitute the contravention and the other facts which, in the opinion of the Regulator, justify the imposition of the penalty and its amount; and
(d) specifying a date, no earlier than the end of the period of 42 days beginning with the date of service of the notice on the authorised person, by which the penalty is required to be paid.
(13) The authorised person may, within the period of 21 days beginning with the date of service of a notice on that person under paragraph (12), make an application to the Regulator for it to specify different dates by which different portions of the penalty are to be paid.
(14) Any notice required to be given under this regulation must be given—
(a) by publishing the notice in such manner as the Regulator considers appropriate for the purpose of bringing the matters to which the notice relates to the attention of persons likely to be affected by them;
(b) by serving a copy of the notice on the authorised person;
(c) by serving a copy of the notice on Citizens Advice; and
(d) by serving a copy of the notice on Consumer Scotland.
(15) Any sums received by the Regulator by way of penalty under this regulation must be paid into the Consolidated Fund.
32 Requirement to publish statement of policy with respect to penalties
(1) The Regulator must as soon as reasonably practicable after this regulation comes into force prepare and publish a statement of policy with respect to—
(a) the imposition of penalties; and
(b) the determination of their amount.
(2) The Regulator may revise its statement of policy and where it does so must publish the revised statement.
(3) Publication under this regulation must be in such manner as the Regulator considers appropriate for the purpose of bringing the matters contained in the statement of policy to the attention of persons likely to be affected by them.
(4) The Regulator must undertake such consultation as it considers appropriate when preparing or revising its statement of policy.
(5) It is immaterial for the purposes of paragraph (4)whether consultation is carried out before or after the coming into force of this regulation.
The Regulator may not impose a penalty in respect of a contravention later than the end of the period of 5 years from the date of the contravention, unless before the end of that period—
(a) the notice under regulation 31(8) relating to the penalty is served on the authorised person under regulation 31(14);
(b) a notice relating to the contravention is served on the authorised person under regulation 48(2); or
(c) a final or provisional order is served on the authorised person.
(1) If the whole or any part of a penalty is not paid by the date by which it is required to be paid, the unpaid balance from time to time carries interest at the rate for the time being specified in section 17 of the Judgments Act 1838.
(2) If an application is made under paragraph (13) of regulation 31 in relation to a penalty, the penalty is not required to be paid until the application has been determined.
(3) If the Regulator grants an application under that paragraph in relation to a penalty but any portion of the penalty is not paid by the date specified in relation to it by the Regulator under that paragraph, the Regulator may, where it considers it appropriate, require so much of the penalty as has not already been paid to be paid immediately.
(1) If the authorised person on whom a penalty is imposed is aggrieved by—
(a) the imposition of the penalty;
(b) the amount of the penalty; or
(c) the date by which the penalty is required to be paid, or the different dates by which different portions of the penalty are required to be paid,
the authorised person may make an application to the court under this regulation.
(2) An application under paragraph (1) must be made—
(a) within 42 days beginning with the date of service on the authorised person of a notice under regulation31(12); or
(b) where the application relates to a decision of the Regulator on an application by the authorised person under regulation31(13), within 42 days beginning with the date the authorised person is notified of the decision.
(3) On any such application, where the court considers it appropriate to do so in all the circumstances of the case and is satisfied of one or more of the grounds falling within paragraph(4), the court—
(a) may quash the penalty;
(b) may substitute a penalty of such lesser amount as the court considers appropriate in all the circumstances of the case; or
(c) in the case of an application under paragraph (1)(c), may substitute for the date or dates imposed by the Regulator an alternative date or dates.
(4) The grounds falling within this paragraph are—
(a) that the imposition of the penalty was not within the power of the Regulator under regulation31;
(b) that any of the requirements of regulation31(8) to (12) or (14) have not been complied with in relation to the imposition of the penalty and the interests of the authorised person have been substantially prejudiced by the non-compliance; or
(c) that it was unreasonable of the Regulator to require the penalty imposed, or any portion of it, to be paid by the date or dates by which it was required to be paid.
(5) If an application is made under this regulationin relation to a penalty, the penalty is not required to be paid until the application has been determined.
(6) Where the court substitutes a penalty of a lesser amount it may require the payment of interest on the substituted penalty at such rate, and from such date, as it considers just and equitable.
(7) Where the court specifies as a date by which the penalty, or a portion of the penalty, is to be paid a date before the determination of the application under this regulationit may require the payment of interest on the penalty, or portion, from that date at such rate as it considers just and equitable.
(8) Except as provided by this regulation, the validity of a penalty is not to be questioned by any legal proceedings whatever.
Where a penalty imposed under regulation31, or any portion of it, has not been paid by the date on which it is required to be paid and—
(a) no application relating to the penalty has been made under regulation35 during the period within which such an application may be made; or
(b) an application has been made under that regulationand determined,
the Regulator may recover from the authorised person, as a civil debt due to it, any of the penalty and any interest which has not been paid.