Tariff Information
Understanding how your heat network and private utility network charges are calculated.
Heat Network Tariff Information
How your heat usage is billed.
Invoices are produced and are separated into two elements: Consumption charges and daily standing charges.
Consumption Charges
The consumption measured by your Heat Interface Unit (HIU) is multiplied by the pence per unit charged by the Heat Supplier for the period to cover the cost. These costs include components such as raw commodity (gas) and industry transmission charges.
Understanding the Heat Tariff
The heat tariff reflects more than just the price of gas. While the raw gas rate covers the fuel alone, the heat tariff also accounts for efficiency losses when converting gas into usable heat, as well as the ongoing costs of operating and maintaining the plant and distribution network. This ensures reliable supply, safe operation, and fair recovery of system costs.
Daily Standing Charges
These are charged daily and include costs such as fees to 3rd parties and costs incurred in ensuring the availability of the heat network. Standing charges also cover policy costs incurred by the main gas supplier in support of government schemes, including the assistance of vulnerable households with energy bills and the support of renewable energy technology and reduction of carbon emissions.
Important Note
Standing charges are applied even if the property is empty and not consuming any heat.
Billing and VAT
Every quarter, charges are reviewed and reconciled and broken down into their component parts to ensure accurate billing. Both the tariff and the daily standing charge will appear on your invoice. There is also a 12-month comparison so you can compare and monitor consumption.
If the Heat Supplier is VAT registered, VAT will be added to the invoice. If the Heat Supplier is not VAT registered an equivalent rate will be charged equal to the VAT charged by the Energy Supplier. This is to ensure the Heat Supplier recovers enough funds to pay the Energy Supplier.
Electricity, Gas and Water Private Network Tariff
Understanding billing in buildings with private utility networks.
Commercial buildings that have been converted into residential homes are usually done so under permitted development rules, which allow for more flexibility and a simpler planning process.
Why Private Networks Exist
Installing separate on-grid utility supplies for each flat can be expensive. In many cases, it’s more practical to keep the building’s existing utility setup and instead install a private network with sub-metering.
How It Works
The original electricity and water supply points remain and provide utilities to the whole building. A private network and sub-meters are then used to measure how much electricity and water each flat uses from the main supply.
The main utility suppliers send bills to your landlord/freeholder for the total usage from these main supply points. Your landlord/freeholder (Reseller) then charges each resident their share, based on readings from their individual sub-meters. This setup is known as a private network with sub-metering. OFGEM and OFWAT (the regulators) refer to this process of passing on utility charges as reselling.
Key Limitations
- When connected to a private supply, residents cannot switch utility supplier.
- The Energy Price Guarantee (or price cap) does not apply. This is because the main meters are on commercial contracts, and the price cap only applies to domestic ones.
We understand this may seem unfair, especially as the end use is domestic. However, energy suppliers are not allowed to apply domestic pricing to commercial contracts, and it’s not possible to get a domestic contract for meters that use such high amounts of power.