The Department for Energy Security and Net Zero announced on 23 September 2026 that £90 million in government funding will go to new and upgraded heat networks, with more than 750,000 homes expected to benefit from cheaper, cleaner heating and more than 2,000 jobs created across all projects1.
Heat networks heat multiple buildings from a central source, such as excess heat from a data centre or a factory, through pipes carrying hot water1. The largest award is £41 million for a project under and alongside the River Thames, which the department says will supply 650,000 homes with clean heat and potentially benefit over a million residents1. It will initially transport hot water 25 kilometres each day by electric barges down the river and then via a specially constructed tunnel underneath it1. The project is subject to planning consent and is expected to help unlock around £5 billion of investment in London's local heat networks1.
Other awards include £9.7 million for Bradford, where 255 homes, a hospital and seven schools and colleges will benefit; £11.5 million for Bexley and Greenwich to develop what could be the largest heat network in the UK, serving up to 100,000 homes when fully built; £11.4 million for Marble Arch, using water-source heat pumps taking energy from the London Chalk Aquifer and creating 200 jobs; and £3.9 million to extend Solihull's existing network, which serves council buildings, a leisure centre, a theatre and a college1.
Alongside the new build funding, £13.3 million has been committed to upgrade 76 inefficient heat networks across England and Wales, including replacing leaky pipes, insulating pipework and replacing interface units in homes1. Projects include £5.5 million in London for systems serving 1,143 residents at Prospect House in Bermondsey and the Packington Estate in Islington; £1 million in Manchester for 130 residents at Cornwall Court in Gorton and Cundiff Court in Levenshulme; and £374,900 in Wales for Eschol Court in Newport and Victoria Court in Abergavenny, benefiting 62 connected residents1.
"Clean power and clean heat benefits communities across our country. Building the infrastructure to deliver it is reindustrialising the UK and rolling out cutting-edge energy technology so families can benefit from lower bills, good jobs and energy security."
| Project | Funding | Detail |
|---|---|---|
| River Thames | £41 million | 650,000 homes, subject to planning consent |
| Bexley and Greenwich | £11.5 million | Up to 100,000 homes when fully built |
| Marble Arch | £11.4 million | Offices, homes, hotels and businesses around Oxford Street |
| Bradford | £9.7 million | 255 homes, a hospital, seven schools and colleges |
| Solihull | £3.9 million | Extension of existing network |
| Manchester | £1 million | 130 residents |
| London upgrades | £5.5 million | 1,143 residents |
| Wales upgrades | £374,900 | 62 residents |
The department also cited the Vega Building in Brighton, where residents in 40 homes are saving £438 a year on heating and hot water after a £200,000 grant through the Heat Network Efficiency Scheme funded improvements in 2024, including to the engine room, pipework insulation and thermostatic radiator valves1. The system had been operating at 35% efficiency, and the building now uses 50% less gas1.
Why it matters for households
For homes connected to a heat network, the practical effect of the upgrade funding is better control of heating and less wasted heat, which the department links to lower bills1. The new build awards extend centralised heating to areas that do not have it, reducing reliance on individual gas boilers in those buildings1. The department describes the Thames project as the first of its kind in the UK, designed to make the capital less reliant on gas, with matching systems having operated for decades in Copenhagen, Amsterdam, Vienna and Berlin1. Heat networks are regulated by Ofgem, which has been the statutory regulator for heat networks in Great Britain since 27 January 2026, with operators and suppliers required to register by January 20272. Before that, the Heat Trust operated as a voluntary consumer protection scheme, launched in November 2015, and will continue for a transitional period2. The £90 million sits within the broader Heat Network Transformation Programme, which includes the Green Heat Network Fund and the Heat Network Efficiency Scheme2. Policy on energy and buildings differs across the UK, with Wales covered by part of this upgrade funding1.
What happens next
All new infrastructure projects must apply for planning consent, and the department states that government funding decisions are separate from planning decisions, which will be taken on the facts of each case through the planning process1. The Thames project is subject to planning consent1. Heat network operators and suppliers must register with Ofgem by January 20272.