Should landlords go ahead with heat metering installations, even if the government’s assessment tool says it’s not cost-effective?


London_SunsetAre you a landlord of a tenanted commercial building or residential flats? Perhaps you have a communal heating or cooling systems and more than one tenant occupying the building? If you have answered yes to both these questions, then as a landlord, you will be affected by the Heat Network (Metering and Billing) Regulations.

The Heat Network Regulations cover many multi-let buildings served by a communal heating or cooling system, typically a centralised boiler or chiller plant. As a result, properties ranging from commercial estates to small blocks of flats are subject to the Heat Network Regulations.

Here are the details:


As part of the Heat Network Regulations, landlords must ensure that from 31st December 2016, suitable meters are installed in all buildings with a communal heating system, where it is both cost effective and technically feasible to do so. However the tool used to assess the feasibility and cost-effectiveness of installing HEAT meters is currently being revised by the department of Business, Energy and Industrial Strategy (BEIS) after failing to prove that installing HEAT meters is feasible for landlords. Pending this revision, it has been advised that no further assessments should be carried out. BEIS is looking to launch a new cost effectiveness tool alongside regulatory amendments later in 2017, so stay tuned.


Part of the regulations is that any bills for energy costs, which are being recovered through the service charge, must be on the basis of the actual consumption of energy by each tenant and not, for instance, based on floor area or a set percentage in the lease. Tenants should receive a bill that is based on actual consumption at least once a year. Issuing bills that comply with the standards imposed by the Heat Network Regulations has been a legal requirement since 31st December 2014, and only applies where meters have already been installed.

STC Energy would encourage landlords to implement a metering and billing solution so that all fees are transparent and accurate. The regulations will also ensure fairness in regards to tenants only paying for what they use. If landlords are worried about additional administration to bill their tenants, they could perhaps consider a tenant billing service. A tenant billing service will ensure all tenants are accurately billed for their usage.

Code of Practice

The Heat Network Code of Practice has been produced by both CIBSE and the Association for Decentralised Energy (ADE). The Code seeks to provide clear and measurable outputs which will ensure that a heat network operates effectively and meets client and customer expectations. Setting minimum standards is a key step to provide greater confidence for specifiers and clients and these can also be included in the tendering/contracting process.

CIBSE qualified Heat Network consultants in our energy management and compliance team have been assessed on their knowledge and understanding of the Code of Practice. This gives our customers the confidence that the guidance in the Code of Practice is being appropriately applied.

Want to know how the regulations could affect you, or would like expert advice? Call 0208 466 2950 to speak with one of our Heat Network consultants, or visit

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