Heat Network Efficiency Scheme (HNES)

The Heat Network Efficiency Scheme (HNES) provides funding to public, private and third sector applicants, to support improvements to existing district heating or communal heating projects in England and Wales that are operating sub-optimally and resulting in poor outcomes for customers and operators. Projects can apply to HNES for either revenue or capital grant funding. Revenue grants fund procurement or mobilisation of external third-party support to carry out Optimisation Studies that assess heat network projects to identify causes of sub-optimal performance and recommend costed intervention or improvement measures. Capital grants part-fund the delivery (installation) of eligible intervention/improvement measures. HNES is a multiple-funding-round grant support programme with funding expected to be deployed across FY23/24 to FY27/28. The scheme aims to improve heat network performance in existing/operational projects where customers and/or operators are experiencing sub-optimal outcomes, particularly addressing customer detriment for consumers impacted by increasing costs of living and energy. Applicants will be required to fulfil monthly/quarterly monitoring and reporting requirements and consent to publicise grant value and details of funded activities.