Heat Networks Delivery Unit: Round 1314 (closed(open to applications)

Local authorities have a key role to play in making heat networks succeed. Their involvement, particularly in the development stages, can help realise the benefits of heat networks, while also delivering jobs and growth. In order to address the capacity and capability challenges which local authorities identified as barriers to heat network deployment in the UK, the government set up the Heat Networks Delivery Unit (HNDU) in 2013.

The Heat Networks Delivery Unit provides grant funding and guidance to local authorities in England and Wales for heat network project development.

Since its inception, HNDU has run 13 funding rounds, awarding £33.8£37.8 million in total. Over 300 unique projects have so far been supported across 188 local authorities.

As of Round 13,14 HNDUis expandedavailable the organisations it supports to additionallyfollowing fund:eligible applicants:

• registered social landlords
• NHS Trusts
• universities
• other government departments
• property developers

By extending HNDU funding support 3will yearscontinue in advance of legislation coming into force to organisationsbe mostavailable likely to participate in aadvance of heat network zone,zoning suchlegislation organisationscoming willin be better able to planforce. forThis thatfunding eventualitywill and help bringsupport someareas of the networks within future zones to marketcontinue in advance. This should increase the numberdevelopment of credibletheir projects originatedin throughreadiness HNDUfor supportheat asnetwork the key anchor loads themselves will be advancing the projects.zoning.

See the overview of government support for heat networks.

Scope

The Heat Networks Delivery Unit provides support to local authorities in England and Wales through the early stages of heat network development:

• techno-economic feasibility
• detailed project development

HNDU support does not provide funding for commercialisation costs and costs associated with the construction, operation and maintenance of a heat network. The Green Heat Network Fund (GHNF) can however support these activities as it is a £288commercialisation millionand capital investmentgrant programme providingthat opened to applicants in March 2022. Initially a £288 million fund, its popularity has meant further funding has been made available to support fororganisations in the capitalpublic, costsprivate, ofand heatthird networks.sectors in England. The additional funding can be drawn down in financial years 2024/2025 through to 2027/2028.

The process

Local authorities and other eligible organisations apply for HNDU support through bidding rounds. All bids are reviewed by HNDU assessors before final recommendations are approved by a panel of financial, commercial and policy specialists.

Grant funding is provided to successful local authorities under Section 31 of the Local Government Act and other applicants under Section 98 of the National Environment and Rural Communities Act 2006. Eligible costs are defined as externally commissioned consultancy costs for heat network development work. HNDU funding comprisescan nosupport more100% than 67% of eligible costs, withincluding thefor exception of project managementmanagement, costs which mayis beonly fullyavailable funded by HNDU for public sector applicants and registered social landlords –- please see publishedthe Round 1314 guidance.guidance below.

If successful, each local authority is supported by a team of specialists within HNDU. Other applicant organisations will receive HNDU specialist support to the extent it is assessed necessary by either the applicant or HNDU and sufficient resource is available.

Round 1314

For more information on this or previous funding rounds, please see relevant documents on this page below or email hndu@energysecurity.gov.uk. To request an application form, please email hndu@energysecurity.gov.uk.

HNDU Pipeline

We publish a quarterly HNDU project pipeline with accompanying spreadsheet summary.

Local authorities supported by HNDU

Successful local authorities, rounds 1-121-13 (MS Excel Spreadsheet, 36.437 KB)

Heat network guidance

Heat networks: guidance for developers and supply chain

Related publications and tools

Template financial model

Evaluation of the Heat Networks Delivery Unit: Part 2 published April 2018

The future of heating: meeting the challenge, March 2013