Homeowners ‘trapped’ on ‘inefficient’ heating system face £4k bills

Homeowners trapped on an unmetered council heating system that they say uses twice the energy of a typical boiler are struggling to pay their service charge bills after they doubled to more than £4,000.

The leaseholders on two Southwark council-owned estates in Peckham, are among 17,000 households across the borough who receive their energy through a district heat network, where a communal boiler supplies heating and hot water to multiple  properties.

Southwark council insists district heating is cheaper and more efficient than individual boilers in the long-run. But residents claim poorly insulated pipes transporting energy from the communal boiler to their properties are leaking heat, leaving their homes unbearably warm and pushing up their bills.

Council tenants on district heat networks had their bill increases capped at 10 per cent this year thanks to the local authority’s heating account, which allows small surpluses and deficits to be carried from one year to another to reduce the impact of energy price fluctuations.

But leaseholders, who always have to pay the actual cost of their estate’s heating within a financial year, say their bank accounts are buckling under huge yearly bill increases.

Emily Miller, 40, who bought a two-bedroom flat on Peckham’s Consort estate in 2014, said her annual service charge bill had gone up from £1,800 a decade ago to over £4,500 this year, mainly due to a surging heating and hot water charge.

She said: “Being leaseholders, we are totally trapped. Initially, I took it on the chin but the bills seem to have rocketed in the past few years.

“The flats are so warm as it is, we only have the heating on four times a year. This year I had to buy a standalone air conditioning unit. It was £450 and it uses lots of electricity and the electricity isn’t covered by the service charge.”

Jay Brown, 37, who lives in a three-bed home on the Cossall estate with her partner, said their yearly service charge was £1,800 when she moved in 2021. This year, the estimate was almost £5,000.

She said: “We don’t have any control. The council seem to think that because we are leaseholders we can afford it, but we’re barely scraping by.”

Tom Vosper, the man responsible for district heat networks at Southwark council, admitted to Consort estate residents at a meeting in July that the communal boilers were using double the amount of energy than a typical individual boiler.

He blamed the high energy consumption on the age of boilers on the estate, loss of heat through the network and the lack of metres in properties, which he said meant residents didn’t have an incentive to save energy.

Despite this, Mr Vosper insisted that inefficiencies in the heating system weren’t the main thing driving leaseholders’ bill rises.  He attributed the increased costs to the fact that the council is paying 450 per cent more for energy than it used to.

But some leaseholders remain unconvinced with the Labour-run council’s excuses and want to be removed from the district heat network altogether.

Jody Reynard, 49, who bought his two-bed flat on the Consort estate in 2008, said: “Like most people, I want to be billed correctly for the energy I’m using. I don’t want to be on the district heat network full stop.”

A Southwark council spokesman said: “We know that district heating offers better value for residents long-term and offers opportunities for meeting our net zero targets for carbon reduction. In terms of maintenance, it’s also easier to achieve economies of scale on repairs.

“The cost of fuel has risen exponentially over the past years, meaning prices are very high. As we buy in advance, the more recent reduction in price is not yet reflected in bills. There are also still outstanding repairs to the boiler which need to happen. The costs should come down and the heating system offer significant savings over time.”