Customer Contract (Heat Supply Agreement)
You are correct this is unusual. The reason for this is that the heat network is new and the phsycial connection to your home needs to be constructed. Typically in most homes this would exist already (by way of example you might have a gas supply and the connection would already exist and have been installed by the developer). This is not the case here as the heat network is a new build network so we have had to incoporate the actual construction of the connection in to the contract to ensure adequate protections and provisions exist to cover us building the connection at your home.
No. The Council is responsible for all of its equipment and for delivering a heat supply to your home. Like any other supplier the Council could not be responsible for the equipment in your property or indeed your actions. The terms of the contract are based on best industry practice and compliant with consumer rights and Heat Trust standards. It is based on BEIS standard templates for heat supply agreements - which you can see here. We consider we have complied with best industry practice in respect of the Heat Supply Agreement but can of course answer any questions about specific risks.
This agreement is based on best practice for heat supply agreements and has adopted Heat Trust Standards. The Council has also been guided by BEIS example agreements which can be found here. A key difference is the provisions for works. Because this scheme is a retrofit scheme we actually have to build the connection to your home as well and the contract deals with this. A further difference is the Cancellation Charge should you wish to leave. Most tenants in blocks with district heating have no practical choice and have to remain with the district heating provider - effectively customers are "locked in".
Customers could be exposed to a loss of heating and the need to replace their heating systems. The Council considers this risk is very remote and unlikely to arise.
This agreement is based on best practice for heat supply agreements and has adopted Heat Trust Standards. The Council has also been guided by BEIS example agreements which can be found here https://tp-heatnetworks.org/heat-contract-templates/.The agreement has been reviewed by experts through the grant applications submitted to BEIS and internally at Cambridgeshire County Council.
The Heat Trust represents customers and guidance for heat supply. It is an independent not for profit. https://heattrust.org/
When a heat supplier registers their heat network(s) with Heat Trust, it agrees to abide by the Scheme Rules and Byelaws.
Listed Building Consent Order is required for some listed homes to carry out the removal and installation of equipment. Further information on listed building consent will be included within the offer pack to be issued to each household that has a survey.
Installation and Connection
The connection charge is waived for households that sign the Heat Supply Agreement by September 2021.
The connection charge includes:
- Removal of oil tank
- Removal of oil boiler
- Installation of pipes connecting to network
- Installation of Heat Interface Unit (HIU) and heat meter
Yes, the removal of the boiler and oil tank is included within the connection costs, which are waived for those who sign up to the scheme in September 2021. The option to have it removed is set out in Appendix 1 within the Heat Supply Agreement.
The works required to install and connect your home can only be carried out if you agree to what is proposed, so contractors will be required to work with you to make sure that it is agreeable.
They will propose a location and discuss it with you. A formal process has been put in place within the Heat Supply Agreement (Appendix 1) to list the works required, the time frame for these to be delivered, and verify your consent for these to be carried out. (The HSA is available to view at www.heatingswaffhamprior.co.uk/HSA).
The Council is responsible for carrying out its works with reasonable skill and care. It is also responsible for any damage caused to your property. The Council would therefore expect to leave your property in the condition they found it post execution of its works.
In this context "make good any damage" means "any damage" - to use your example if the Council installs an asset and damages pipework in the ground the Council would be responsible for costs of digging back up the ground, repairing the damaged pipe and recovering the pipe.
You should contact the Council and let us know. Where we have not carried out work in accordance with the required standards set out in Appendix 1 - including reasonable skill and care and making good any damage - you would have legal rights against us. However in the first instance the COuncil would, where works had not been executed properly, require its contractor to rectify the problem.
The Council cannot give advice on your individual insurance policy. However people should generally notify their insurer as early as possible if they are doing any building work on their home. The Council will consider providing a statement that people can give to their insurers to assist those who may wish to sign up.
What if in removing an existing oil boiler / tank pre-existing faults of the heating system are identified.
Where the Council causes damage we will be liable for it and pay to repair it. We will not fix any pre-existing faults with your home. A worked example may help - where the Council removes a pre-existing oil tank if the Council's work is negligent and the result is that we damage your property that would be the Council's responsibility and we would have to pay for that.
However, if when the Council removed the oil tank there was pre-existing environmental/contamination issues e.g. the bottom of your tank had spilled as a result of long-term damage not caused by the Council then the Council would not be responsible for this.
No – we have two options available, one which replaces ‘combi’ type boilers, the other that replaces ‘system’ type boilers. The latter would be used in your case, unless it was apparent that conversion to a ‘combi’ type arrangement would be cost effective (and acceptable to you). Our general preference is to deploy ‘combi’ type HIUs, as it is more efficient and provides better controllability of the network. However, we recognise that conversion may, in some cases, be cost prohibitive, or simply unacceptable to the end customer.
For those who wish to retain their indirect hot water tank (instead of converting to the combi-type), a risk assessment will be conducted to assess whether or not safe storage temperatures can be achieved based on the above minimum inlet temperature. If there is any doubt, we would advise on switching to a combi-type HIU.
The standing charge is based on life cycle costs and has been adjusted for property size to range between £262 and £3330
- Average boiler replacement costs £3,000 + oil tanks cost £2,000
- Annualised cost of replacement over 15-20 year life is £200pa
- Total annual cost £330 (£349 inc VAT)
The variable charge will be updated annually in alignment with inflation in January. This is stated in the Heat Supply Agreement.
- Change is based on the Consumer Price Index, published each October
- This means that the tariff will also decrease if CPI falls
The variable price index will change over the project duration as follows:
- Years 1-5: Change is based on the 'liquid fuels' oil component of CPI
- Years 6-10: Change will gradually move to being based on electricity component of CPI.
- Year 10+: Only electricity component is used
Meter readings will be taken remotely on a monthly basis.
The system is guaranteed to deliver a minimum temperature to every house of 72°C when the outside temperature is 0°C or lower, dropping linearly to 62°C when the outside temperature is 20°C or higher. This temperature is important to those of us with older houses which cannot be as well insulated and is thus a potential selling point for this system over per-property air source heat pumps which typically only produce 55-60°C (though there do now appear to be higher temperature versions becoming available https://purethermal.co.uk/high-temperarure-heat-pumps/).
If the required temperatures are not met this counts as an interruption of the supply under the Heat Supply Agreement (HSA), even if heat at a lower temperature is being supplied. The Heat Supply Agreement sets out the arrangements for compensation for all customers where supply of heat is interrupted. In addition, vulnerable customers will be supplied with an alternative heat supply if an interruption (including lower than expected heat) lasts longer than 12 hours.
There will be some variation in the Heat Interface Units to be supplied to each home. Whilst most HIUs are a similar unit size, they vary in kWh output, as a boiler does, so smaller and larger or older homes will have a different capacity HIU installed.
Yes, there are combi-HIU models availabel for installation in homes and suitable for connection with existing heating systems of this sort.
Alternative heating supply will be provided for vulnerable customers in the event of Interruptions.
How much notice will I be given to facilitate any maintenance of the Heat Interface Unit or other Council installations in my home?
The proposed timings set out in the Heat Supply Agreement represent what we consider to be industry best practice.
It will inspected at least once every 24 months.
Who is responsible for the interface between my internal heating system and the heat interface unit?
This will be defined as the "Heat Exchange Point" and will be outlined on a property by property basis. The Heat Supply Agreement makes it clear that the Council will be responsible for its works and heat supply to the Heat Exchange Point.
There will be a performance payment sanction for this - see performance payments section in the Heat Supply Agreement
You can request that the Council inspect it - see the Heat Supply Agreement.
The Council will provide phone and email options to report faults.
Contractors for the project will soon be issuing emergency phone numbers and contact details to support residents between July and December 2021.
Leaving the district heating network…
There will only be a nominal fee required to leave the heat network. The Heat Interface Unit would be removed from your home.
The heat supply agreement follows a typical process used for other utilities i.e. if you own your home jointly then the living owner of the property will continue with the heat supply. Where the home passes in to the estate of the deceased person the estate will be responsible for all charges until the property is sold to a new owner. We thought it was helpful to spell this out for people explcitly as it is something that quite often surprises people when it happens.
If after joining the network, I decide that the heating system isn't working for me, am I able to leave the network?
You are entitled to leave the heating scheme on 30 days notice.
What if a Heat Supply Agreement is transferred to a new property owner, who then backs out of the house purchase?
The Heat Supply Agreement will be retained by the local resident until it is terminated. Where a Heat Supply Agreement is terminated but the new owner is entering in to a Heat Supply Agreement no cancellation charge will accrue.
Project Business Case
Yes, the tariff will contribute to the costs of replacing major equipment as and when required. These costs have been provided for within the project business case to ensure that our customers will always receive a high quality of service.
Yes. The total project will cost up to £12.1m, the Heat Network Investment Project has contributed £3.2m toward costs. This UK fund provides funding to address the cost-gap between renewable and carbon intensive heating. Cambridgeshire County Council will fund the remaining project costs, in alignment with their strategy to take 10,000 homes off oil.
Your Charges will be based on the tariffs and charges set out in the Heat Supply Agreement - as set out these are capped fees by reference to an independent comparator. Administration costs are covered by the project and tariff.
The Council has no intention of selling off the Scheme however were the Council to do this your contract would be with the new heat supplier who would be bound by the heat supply agreements. However the Council has heard the significant concern of local people about selling off the Scheme.
If I sign up to the contract, there is no market competition available to consumers. How is pricing kept competitive?
The heat tariff will be benchmarked against the cost of an oil-fired heating system using a cost comparator. We are proposing to carry out this exercise every 5 years to ensure that our prices remain competitive and do not result in customers paying more for their heat and hot water than they would be if using oil. Should an oil-fired heating system cease to be the most appropriate alternative to the District Heating Network then the cost comparator may be reviewed and any alternative heating options will be considered.
The Council considers the prospect of whole system failure to be highly remote. However you have the right to terminate the Contract at all times.