Inside the Heat Network Trap

An insight into our legal challenge against unfair communal heating systems in Lambeth

We are fundraising £10,000 to cover the potential ‘adverse costs’ one client would owe Lambeth were she to lose her claim. To help Kirsty bring this challenge please donate via her crowdfunder.

PILC have filed claims against Lambeth Council on behalf of two secure tenants, challenging oppressive heating and hot water service charges. Those charges have led to eviction proceedings for tenants. Our clients are long-standing campaigners against these unfair and unjust charges.

In our latest blog, Joseph Griso Dryer and Sam Tippet explain what the ‘heat network trap’ is and how residents are using the law to challenge this injustice.

What is a heat network?

Replacing traditional gas boilers in each property, communal heating systems (also known as heat networks or district heating) distribute heat across multiple properties. A centralised boiler produces hot water, which is transported through a network of pipes to provide heating for premises.

The Social Market Foundation estimates that there may be up to 900,000 households on communal heating, including one in 12 households in social housing.

Communal systems are supported by government as a low carbon and low-cost way to produce heating and hot water for households across the country. However, for many the impact of heat networks has been unaffordable costs, price hikes, and service failures.

What has gone wrong?

Lack of Choice. Residents cannot install a gas boiler or heat pump and are unable to switch providers. They are obligated to purchase their hot water and heating from the heat network itself, no matter the price.

Unaffordable Costs. As heating charges skyrocketed, in one year by 350%, our clients found themselves in receipt of excessive bills they were unable to afford to pay. Neither housing benefit nor universal credit will cover these costs. Tenants on low incomes were plunged into debt. Our clients’ tenancy agreements do not include any rules governing increases and do not limit the amount charges can be increased. Heat Networks are not subject to the Energy Price Cap set by Ofgem, Britain’s energy regulator. Despite campaigns spanning more than a decade, government regulation on pricing remains weak and ineffectual.

No Transparency. Residents were not provided with adequate information about the heat network before they signed their tenancy agreement. They did not know their charges could be dramatically increased or that they could be evicted for arrears. Despite repeat requests for years, no information has been provided by Lambeth as to how bills are calculated or when they will be increased.

Missing Meters. Our clients do not have heating or hot water meters installed in their properties. Costs are not based on individual usage and there is nothing they can do to reduce their bills. Even if they don’t use their heating they still have to pay. Government regulations in 2014, requiring meters to be installed, were not complied with by Lambeth.

Risk of Eviction. Our clients’ tenancy agreements allow Lambeth to collect bills as a ‘service charge’. Non-payment of service charges can lead to eviction proceeding against those who fail to pay. Our clients are unable to leave their homes, as they will then be found ‘intentionally homeless’ by Lambeth and refused further support.

This is the heat network trap: long-standing residents bound by unaffordable and unaccountable charges they can neither reduce nor escape.

The Grounds of Challenge

We have issued an application for judicial review in the High Court.

Our judicial review argues that the heating and hot water service charges are unlawful on two grounds:

Ground 1: The term of the tenancy agreement that Lambeth has invoked to raise the level of service charges is onerous and unfair and in breach of s.62 of the Consumer Rights Act 2015 or regulation 5(1) of the Unfair Terms in Consumer Contracts Regulations 1999.

Ground 2: The levy of service charges and the continuing demand for payment of accrued rent liabilities, together with other accompanying detriments arising from such liabilities is contrary to the protection of property enshrined in Article 1 of the First Protocol (“A1 P1”) of the European Convention on Human Rights (“ECHR”).

Next Steps

We are currently waiting for a decision from the court on whether our clients’ judicial review will be granted permission to proceed to a full hearing.

This claim is being brought together with counsel Tom Hickman KC (Blackstone Chambers) and Jeremy Ogilvie-Harris (Cornerstone Barristers).

To learn more, visit the Lambeth Tenants Heat Campaign website. Or if you’d like further information about the case, please get in touch at office@pilc.org.uk.

We are fundraising £10,000 to cover the potential ‘adverse costs’ one client would owe Lambeth were she to lose her claim. To help Kirsty bring this challenge please donate via her crowdfunder.