With energy costs still affecting households and businesses across the UK in 2025, the conversation around heat metering in communal heat networks has never been more relevant. The Heat Network (Metering and Billing) Regulations (HNR) and the associated Cost Effectiveness Tool (CET) continue to shape the decisions of heat network operators. However, recent changes in energy pricing and policy mean that it’s time to re-examine metering and its cost-saving potential for residents.
Introduced with the 2014 HNR, the CET helps building owners determine whether installing heat meters in previously unmetered properties is financially viable.
The tool’s purpose is twofold:
Historically, when gas prices averaged around 2p per kWh, many CET results suggested that installing heat meters wasn’t economically viable. As a result, many operators deferred metering.
This marks a threefold increase from the historical 2p per kWh price point, such an increase will have rendered many previous CET results obsolete, and operators should review previous negative outcomes urgently, as they’re likely now missing out on substantial operational savings, which could be passed on in lower bills for their residents.
With energy prices at record highs, metering is no longer a “nice-to-have” — it’s a necessity for cost control.
According to Ofgem the average gas unit rate in early 2025 is 6.34p per kWh. Source: Ofgem – Energy Price Cap, Jan 2025
This example compares the costs for a resident using 10,000 kWh annually, in an unmetered vs metered scenario:
That’s over £300 in real, measurable savings — every year.
Installation Cost vs Payback
Installing a heat meter typically costs £200–£500 per household. With annual savings of ~£312, most residents recover their costs within 1–2 years, which then continues to deliver saving every year thereafter.
Despite these clear benefits, some residents remain hesitant about meter installations, often due to concerns around fairness or upfront costs. However, many of these concerns stem from a lack of information which is being provided by operators to residents, a challenge acknowledged across the industry.
Operators and suppliers have a shared responsibility to better educate residents. If residents knew they could save hundreds of pounds annually, objections would likely diminish.
With verified savings and short payback periods, heat metering is a financially sound decision that supports residents, especially during the ongoing cost-of-living crisis.
Heat metering supports wider net zero 2050 targets by reducing carbon emissions and promoting energy efficiency. It also helps private landlords, housing associations, local authorities and managing agents meet ESG (Environmental, Social, Governance) goals by improving social value and environmental stewardship.
The CET remains in place to ensure fairness but should now be re-run using 2025 data, as earlier assessments (e.g., pre-2023) will very likely not reflect current economic conditions.
If your CET assessment was last run before 2023, we would recommend taking another look at the tool. Whether the previous outcome was deemed not to be viable due to gas price or the overall cost of the project, even fabric considerations which previously rendered metering installations a non-starter, could now look quite different due to the three-fold increase in unit prices over the last few years.
Switch2 has completed over 500 CET Tool assessments for our clients and are ready to help if you reassess your metering requirements. We’d strongly urge operators not to wait until their next resubmission and be proactive, as this approach will achieve the best ROI on such projects by maximising the value meters can deliver in both daily operations and payback periods.
Contact our team for a tailored heat metering consultation
How much does meter installation typically cost per household?
Typically, £200–£500, depending on the property. Payback periods are often 1–2 years due to reduced bills. This calculation uses the example used in the above for the period stated.
Are there funding options for meter installation?
While there is no dedicated national scheme solely for heat meter installation, funding may be available through the Heat Network Efficiency Scheme (HNES) where meters are part of wider efficiency improvements.
How often should I re-run the Cost Effectiveness Tool for my scheme?
Simply put, whenever there’s a significant change in energy prices, or a significant change in the scheme in question. Given the sharp rise in gas prices since 2022, re-running the CET in 2025 is strongly advised, even if a negative result was recorded previously.