02/11/2026
Welcome to our Decarbonisation for housing associations newsletter
There is a huge amount happening across the housing sector in relation to decarbonisation, from heat networks and retrofit programmes to EV infrastructure and solar projects. To help Registered Providers navigate this rapidly evolving landscape, we've brought together a selection of free resources, insights and practical guidance in this special edition.
In this edition
Heat Network Authorisation – Are you ready for the January compliance deadline? – The countdown to 26 January 2027 is underway. Carrie Davies explains what the new Ofgem regime means for Registered Providers and sets out the key actions organisations should take now to manage compliance risks and prepare for registration.
Heat networks regulation: what do social landlords need to know? – Ofgem's new heat network regime is reshaping the responsibilities of social landlords. Explore the key implications for consumer protection, billing, governance and compliance, and the practical steps providers should be taking now ahead of the January 2027 deadline.
The home truths of delivering net zero homes at scale – Based on insights from sustainability, environment and asset management leaders across the sector, our latest research explores how Registered Providers are balancing net zero ambitions with affordability, regulatory change and housing quality, while building the foundations needed to deliver decarbonisation programmes at scale. Read our summary of the report below.
Housing & Registered Providers: District Energy Hub – Alongside our wider decarbonisation resources, explore our dedicated district energy hub for housing providers, featuring a wealth of free on-demand webinars, expert articles, practical guidance and legal insight on heat networks, low-carbon energy projects and the evolving regulatory landscape.
The home truths of delivering net zero homes at scale
We have launched a new dedicated hub for housing associations, bringing together the latest insight, legal guidance and practical resources to help Registered Providers navigate the increasingly complex journey to net zero. The hub is accompanied by new research, Decarbonisation for Registered Providers: The Home Truths of Delivering Net Zero Homes at Scale, which explores the key challenges and opportunities shaping the next phase of housing decarbonisation.
The research highlights an important reality: the social housing sector is no longer asking whether it should decarbonise, but how it can successfully deliver net zero ambitions while balancing affordability, resident wellbeing, regulatory compliance and financial resilience. Registered Providers have already made significant progress, with 68.7% of housing association homes achieving EPC C or above, significantly ahead of other housing tenures.
Drawing on interviews with sustainability, environment and asset management leaders across the sector, the report identifies six key themes that are set to define the next stage of investment and delivery.
First, while the Government's Warm Homes Plan has improved medium-term funding certainty through its commitment to domestic decarbonisation and support for millions of homes by 2030, the Autumn Budget 2026 reduced the programme's funding envelope by £1 billion, from £15 billion to £14 billion. This adjustment has increased concerns about the pace and scale of delivery at a time when Registered Providers are already facing significant challenges. Administrative burdens, grant conditions, resident engagement and programme management remain major obstacles to successful retrofit at scale. The report concludes that, while funding certainty has improved compared with previous funding cycles, delivery certainty remains far less assured.
However, the research suggests that providers do not need to wait for perfect policy certainty before taking action. Many organisations are already strengthening procurement strategies, reviewing contractual arrangements and improving programme governance to ensure they are better positioned to access future funding opportunities and deliver projects efficiently. Providers that invest in delivery capability now are likely to be better placed to scale programmes as funding becomes available.
Secondly, housing associations are planning investment programmes against an evolving regulatory backdrop. Changes to Minimum Energy Efficiency Standards (MEES), the forthcoming Home Energy Model and future compliance requirements mean that providers are often required to make long-term investment decisions before the final regulatory framework is fully defined. This creates a risk that today's improvements may not perfectly align with tomorrow's standards.
In response, many providers are focusing on improving the quality of their stock and asset data, strengthening portfolio modelling and testing different investment scenarios. Better asset intelligence enables organisations to make informed decisions today while retaining flexibility to adapt as the regulatory picture becomes clearer. The report identifies robust data and evidence-based decision making as increasingly important foundations for successful delivery.
A third theme is the growing interaction between decarbonisation and housing quality. The report highlights how reforms to the Decent Homes Standard and the introduction of Awaab's Law are bringing energy efficiency, thermal comfort and resident safety into the same conversation. Issues such as excess cold, overheating, damp and mould are no longer considered solely maintenance concerns; they have become integral to discussions about retrofit and net zero delivery.
Rather than viewing these requirements as competing priorities, there is an opportunity for providers to align investment programmes to deliver multiple outcomes from a single intervention. Improving a home's thermal performance, for example, can contribute not only to carbon reduction goals but also to healthier living conditions, reduced mould risk and improved resident comfort. Taking a more integrated approach to asset management is becoming a key characteristic of organisations making strong progress.
The research also points to the increasing importance of heat network regulation. New regulatory requirements overseen by Ofgem are creating additional compliance obligations for organisations that own, manage or operate communal and district heat networks. As heat networks are expected to play a significant role in the UK's decarbonisation strategy, providers are being encouraged to build compliance considerations into projects from the outset.
Looking further ahead, climate adaptation is emerging as a strategic priority. Housing providers are increasingly concerned about the impact of overheating, flooding and extreme weather events on both residents and housing stock. The report argues that climate resilience should now sit alongside carbon reduction as a core asset management consideration. Incorporating resilience measures into refurbishment and investment programmes today may help mitigate future operational, financial and regulatory risks while delivering longer-term value for residents and communities.
Perhaps the most significant finding is that governance, evidence and data are becoming key differentiators. Providers making the strongest progress are investing heavily in asset intelligence, procurement frameworks, governance structures and delivery capability. The organisations best placed to succeed are not necessarily those with the most ambitious targets, but those with the systems and evidence needed to deliver against them.
As the report concludes, the housing sector does not have an ambition problem; it has a delivery challenge. Our new Registered Provider Decarbonisation Hub has been created to help housing associations navigate that challenge, offering practical insight across funding, regulation, retrofit delivery, heat networks, climate resilience and emerging legal risks.
For housing associations looking to plan the next phase of their decarbonisation journey, the message is clear: success will depend on strong governance, robust data, clear investment priorities and the confidence to plan ahead despite ongoing regulatory uncertainty. By investing in these foundations now, providers can position themselves not only to meet future compliance requirements, but also to unlock wider benefits for residents, communities and the long-term resilience of their housing stock.
Visit our decarbonisation hub to find out how we can support your decarbonisation programme here.
Heat Network Authorisation – Are you ready for the January compliance deadline?
For registered providers that own or operate heat networks, the new regulatory regime is no longer a distant consideration. With the heat network authorisation conditions now in force and the transitional period ending on 26 January 2027, registered providers need to have a clear compliance programme in place and be appropriately resourced to deliver that programme.
The new requirements extend across areas including consumer protection, complaints handling, transparency, governance and operational performance, with Ofgem having powers to investigate and enforce non-compliance. Doing nothing is not an option.
In addition, registered providers should be reviewing tenancy agreements, leases and other property documentation to ensure they remain fit for purpose under the new regime, as well as considering requirements such as registration with the Energy Ombudsman.
At the same time, decarbonisation remains a strategic priority. Many existing communal heating systems will require significant investment to support both net zero ambitions and future resident expectations. The most successful registered providers are likely to be those that treat heat networks as strategic infrastructure assets, aligning regulatory compliance with wider asset management, retrofit and sustainability programmes.
What is happening?
The government has identified decarbonisation of heat as a strategic priority in the path to net zero. Heat networks offer an excellent opportunity to decarbonise heat at scale. However, to date heat networks have been a patchwork of localised solutions, of varying quality. To address this and accelerate the roll-out of heat networks in areas where population density suggests they can have a meaningful impact on the country’s emissions the government is using three main approaches:
Authorisation for existing and future networks – to deliver defined and measurably improved outcomes for consumers connected to heat networks;
Standardised technical performance standards for heat networks;
Zoning to promote private sector investment in heat networks and accelerate development.
Taken together, these three approaches are expected to mean that by 2050, 20% of England’s heat demand should come from heat networks (up from about 3% currently).
Why is there a compliance focus?
While many people are happy with their experience of being connected to heat networks, others have a markedly different experience.
Citizens Advice is the official consumer champion for heat network customers. They have identified a number of issues, particularly for those whose heat charges are bundled into their rent or service charges.
To achieve the strategic trajectory the government is aiming for, heat networks need to deliver positive outcomes for customers. Therefore, the first stage of the government’s approach, authorisation, is being implemented now. The intention is that heat networks are regulated in a way similar to that of other utilities, while recognising the fundamental difference in that customers cannot switch away from a heat network, in the way that they can from electricity or gas suppliers.
What is “authorisation”?
From 27 January 2026, those who operate and / or supply heat, hot water and / or cooling through heat networks are regulated by Ofgem and must comply with the “Authorisation Conditions”.
Those heat networks that were operational at the start of 2026 are deemed to have been authorised. However, operators and suppliers must comply with the applicable Authorisation Conditions and register their heat networks with Ofgem by 26 January 2027.
The Authorisation Conditions, and associated guidance and policy are established based on the Heat Network (Market Framework) (Great Britain) Regulations 2025 (“Regulations”).
The approach focuses on consumer protection, including:
Fair and transparent pricing
Customer service standards
Billing requirements
Complaints handling
Reliability and continuity of supply
Governance and accountability
The Regulations apply to “relevant heat networks” which can be district or communal and to those conducting a “regulated activity” (i.e. operation and / or supply). The application of the Regulations is fact-specific and must be considered on a case-by-case basis.
The Authorisation Conditions comprise 29 Conditions which apply variously to operators and suppliers. To achieve, and maintain authorisation, those undertaking a regulated activity must evidence compliance with the relevant Conditions.
Registration through Ofgem’s portal is required by 26 January 2027, and prior to registration, operators and suppliers are expected to have ensured that they are compliant, even if (in some cases) evidence of that compliance does not have to be submitted as part of the registration process.
Obligations cannot be contracted out of, and Ofgem has significant enforcement powers, including fines and criminal sanctions.
Does this affect us?
Any housing association or registered provider that operates and / or supplies heat, hot water and / or cooling through a district or communal heat network is likely to fall within the scope of the Regulations.
For example, you may be affected if you own, manage or operate:
A district network serving more than one residential block or development;
A communal network serving apartments within a single building;
Importantly, the definitions in the Regulations are broader than many organisations expect. For example, being a supplier is not limited to organisations with standalone heat supply agreements. Heat supplied through tenancy agreements, leases, service charge arrangements or shared ownership structures may also fall within the scope of Regulations.
Given the complexity of many housing ownership and management structures, it is essential to understand precisely where regulatory responsibilities sit.
What should we be doing now?
Map your sites
Are any of the premises you are responsible for receiving heat / hot water / cooling through a relevant heat network? If so, you are likely to be affected by the Regulations. As a minimum, you should apply the definitions in the Regulations and document the reasons why you believe they do not apply (if that is your conclusion).
Confirm your status
If you conclude that the Regulations do apply, you need to consider how they apply:
Do you operate a relevant heat network?
Is it a district heat network or communal heat network?
Are you acting as operator, supplier or both?
Have any responsibilities been outsourced to managing agents, ESCo providers or contractors?
Understanding these distinctions is critical because different obligations apply depending on your role.
Remember, the application of the Regulations is site-specific and cannot be contracted out of.
Allocate resource and establish a compliance programme
Registration will require organisations to demonstrate compliance with the Authorisation Conditions.
This will often involve input from teams including:
Asset management
Property services
Resident services
Legal teams
Procurement
Finance
Building safety
as well as any external heat network operators and contractors
Many registered providers will benefit from establishing a cross-functional working group to coordinate compliance activity and identify gaps in current arrangements.
Review resident-facing arrangements
As we have mentioned the new regulatory regime places customer experience at its heart. This means that any arrangements that touch on the experience of the end recipient of heat / hot water / cooling must be considered, for example:
Tenancy agreements
Lease provisions
Service charge arrangements
Heat supply agreements
Resident communications
Complaints policies
The Authorisation Conditions also focus on organisational governance. While registered providers are excluded from the application of certain Conditions because of oversight by the Regulatory of Social Housing, there are still various key governance requirements that must be evidenced.
In addition, from the consumer-facing perspective there are obligations relating to transparency, billing, pricing and complaint handling. Organisations should consider whether existing documentation and processes are sufficient to demonstrate compliance. For many providers, this will mean aligning heat network arrangements with broader consumer regulation and Tenant Satisfaction Measures.
Consider contractual arrangements with third parties
Many housing associations use third-party operators, maintenance providers, managing agents or energy service companies (ESCOs) to deliver heat network services to their residents. However, as we have mentioned the Regulations still apply even where services are outsourced. This means reviewing:
Operations and maintenance agreements
Asset management contracts
Energy supply contracts
Development agreements
Long-term concession arrangements
It is particularly important to ensure that responsibilities for regulatory compliance are clearly allocated, and that acts or omissions by third parties do not put providers in breach of the Regulations.
Review pricing and cost recovery mechanisms
The Authorisation Conditions require that providers evidence that charges are fair and not disproportionate. This means considering:
Existing heat tariff structures
Service charge recovery arrangements
Leaseholder billing mechanisms
Capital investment recovery
Treatment of major works costs
Funding of future network upgrades
There is no standard pricing formula. Instead, providers must be able to evidence that charging arrangements are transparent, reasonable and support consumer protection objectives. For organisations planning heat network upgrades or decarbonisation projects, understanding how costs can be recovered will be increasingly important.
What does this mean for future development and decarbonisation projects?
The Regulations arrive at a time when many registered providers are pursuing:
Net zero commitments
Heat decarbonisation programmes
Regeneration projects
Retrofit schemes
New-build low-carbon developments
As we have mentioned, the government expects that heat networks will play a significant role in meeting decarbonisation goals. Therefore, even if your organisation does not have properties currently connected to a district energy network, this is likely to change in future.
As a result, heat network compliance considerations should be addressed early in project planning rather than after procurement or construction has commenced.
This includes considering:
Ownership models
Operational responsibilities
Procurement structures
Resident protections
Asset management requirements
Long-term regulatory compliance costs
Early legal and commercial input can help avoid the need to restructure projects later in the development cycle.
In summary
If your organisation has any property that is connected to a relevant heat network or is likely to be in an area zoned for future heat network development, preparation should begin now.
If you currently have affected properties, the first step is understanding whether you are an operator, supplier or both, and then assessing how the Authorisation Conditions apply to your specific arrangements.
Successful compliance will depend on being able to clearly demonstrate robust governance, transparent decision-making and a resident-focused approach.
Unfortunately, there is unlikely to be a single compliance model that works for every housing association. The way the Regulations apply will depend on ownership structures, contractual arrangements and how heat is supplied to residents.
As Ofgem guidance develops and registration activity increases, market practice will continue to evolve. In the meantime, organisations that take early steps to review their arrangements and document their approach will be best placed to manage regulatory risk. In any case, 26 January 2027 is a hard deadline.
Our team is helping housing associations, registered providers and local authority housing teams navigate the new regulatory regime for heat networks. If you would like to discuss your organisation's position and how the Regulations may apply, please get in touch with Helen Stead, Carrie Davies or Sophie Stawte-Lewis.
You can also access our articles, briefings and webinars through the Points of Connection hub, our knowledge centre for organisations involved in heat networks, district energy and decarbonisation projects.
For legal updates on the transition to net zero, follow our dedicated Energy & Resource Management page.
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