Heating and Hot Water in new block of flats.

popcorn1234

Hi experts, 

We (2 adults) moved into a 1 bedroom apartment in a new block of flats at the start of February. The flats have radiators for heating. There is a specific provider for hot water/heating. We have a specific meter in the flat. We pay electricity separately. 

After weeks of asking, we have finally received our first bill for the period 01/02/24 - 31/03/24. 

The breakdown of the bill is:

Consumption (end read - start read) x Tariff: 429.5 kWh x £0.1625 / kWh = £69.77
Standing Charge: 59 Day x £0.4750 / Day = £28.02
Net Bill Amount: £97.79
VAT Amount: £4.89
Total Bill Amount: £102.68

I have never lived in a building where hot water and heating is billed through a separate provider and I was just hoping to gather some thoughts/advice on the following:

- Does anyone think this charges appears quite high? We were away quite often during this period and hardly used the heating as the building is well insulated. 

- What does the service charge consist of? 

Thank you in advance

TheElectricCow

The trouble with these heat network systems is A: there’s not a whole lot of regulation and consumer protection around them compared to standard energy supplies. And B: you’re typically tied in to using one (or a very limited selection of) billing agents/suppliers, so in practical terms have to accept whatever prices they set.

My personal opinion on these systems is they’re best avoided as far as possible, due to the high potential for issues either on the administrative side or the physical running of the system which residents have little control over. Metered systems like you have are definitely better than unmetered ones as you only pay for actual usage, but that still places a reliance on the competence of the billing company.

Your rates at the moment don’t appear to be particularly excessive and for two months heating/hot water consumption for two people your usage seems reasonable. Although without a lot of detailed information on your household and habits no one would be able to say whether this amount is correct for you, as every property and person are different and have different energy needs. 

For reference, you’re paying a little over 16p per unit of energy on this bill. To compare with other methods (likely unavailable in this property), for standard gas heating this may be in the region of 6p/unit and a multi rate electric tariff might see prices of around 12p/unit. Standard single rate electric heating could come in closer to 24p/unit, so what you’ve got isn’t the cheapest or most expensive option but does land somewhere in the middle.

What your standing charge covers would best be answered by whoever is managing this system, as those costs could be unique to the arrangements for this individual installation. Generally speaking these daily charges might account for the maintenance and upkeep of running the system for the building, so think things like servicing of the main boiler, repairs if the system fails, and managing the metering arrangements.