13 Aug 2018

WBD has drafted a report for the Department for Business, Energy and Industrial Strategy (BEIS), providing guidance for local authorities and other public bodies on developing heat network projects in collaboration with non-public investors in the UK.

The report – Heat Networks: Procuring Finance – was launched by BEIS last week and aims to help the promoters of heat network projects analyse the factors which influence the choice of best structure for their project considering, in particular, the involvement of non-public investors. 

Heat networks form an important part of the government’s plan to reduce carbon emissions and cut heating bills. They have great potential, particularly in urban areas and other areas of dense heat demand. A significant number of projects are already in the development stages. However, local authorities have expressed concerns about the procurement law and State aid implications of collaborating with non-public investors in their development. 

BEIS commissioned WBD to write this guidance in order to support local authorities to better understand at what stage they should engage with a non-public investor; the role(s) non-public investors can play; what procurement law and State aid implications are likely to be involved for different project structures; and the range of possible solutions there are for delivering a project which meets the local authority's objectives, complies with legal requirements and supports investment from non-public sources.

Charles Robson, Partner at WBD, commented:

"It has been a pleasure working with the BEIS team to produce this important guidance. The development of heat networks is a priority for decarbonising heat in the UK but some important issues are not well understood and this is creating barriers to their delivery. We hope this guidance will play a part in broadening the range of players and enhance the understanding of structures used to deliver these schemes."

George Robinson from BEIS' Heat Networks Delivery Unit added:

"We're grateful to WBD for using their deep specialist knowledge to untangle these issues. Charles and his team have been able to produce this highly informative and accessible guidance that touches on many important issues around heat networks projects."

Womble Bond Dickinson works closely with UK Local and Central Government authorities, as well as other organisations in the wider public and third sector. The firm advises the UK Government's Crown Commercial Service, providing a full-service of legal expertise across a range of disciplines, including general commercial, litigation and employment advice. WBD was appointed last year as a Tier 1 firm advising Central Government Departments, Agencies and Arms' Length Bodies.