I’m paying £5,000 a year on energy bills – and was left without heating and hot water as snow fell

Londoners who are paying up to three times the typical household’s energy bill spent early January’s cold snap without heating or hot water.

More than 700 households on the North Peckham Heating Network were left in the cold as temperatures plummeted on Sunday (5 January) when a boiler failed, leaving them without heating and hot water for more than 24 hours.

Heat networks like the one in Peckham supply heat from a central source to consumers and are often operated by local councils. They’re intended to be more environmentally friendly and cost effective than individual boilers – but it means residents are unable to switch energy providers or control their energy bills through usage.

However, the network in South London has come under criticism for leaving customers facing eye-watering bills despite being proven unreliable, leaving residents without hot water and heating when temperatures plummeted and the UK was hit by winter storms.

Max Templer, a resident on the Gloucester Grove estate in Peckham, told the Big Issue residents had faced a £5,000 service charge cost covering energy bills alongside a £4,700 bill to cover major works.

The steep price is down to issues with the network leading to more than three times more gas per property being used to heat homes than individual boilers in each home would require. It dwarfs the cost of the typical bill for UK households, which increased to £1,738 per year from 1 January under Ofgem’s energy price cap.

“I’m stressed out by the cost and it makes your flat basically very difficult to sell because the service charge is so high,” said leaseholder Templer.

“But for some of my neighbours, they’re really worried about not being able to pay their service charge and people are really worried about being made homeless by these kind of costs.”

A 2018 report from the Competition and Markets Authority found heat networks offer customers a cost-effective supply of heat compared to alternatives, but warned “some customers experience poorer outcomes in terms of price and service”.

It’s an issue that the Big Issue covered last year when council house tenants in Lambeth saw their energy bills soar 350% and warned some residents were receiving eviction notices if they couldn’t keep up.

In Peckham, another resident Dolly Thomas told the Big Issue that residents worry the high charges could lead to them losing their home.

“We had to have electric heating on all over the house at the weekend, I don’t know what is going to cost us,” said Thomas, who lives in the property with her disabled daughter.

“Monthly we’re paying £654 for the service charge which includes the heating. Whether it’s summer or winter we still pay that money. Whether it’s working or not we still pay that money.

“After the major works bill, I called the council to let them know it was too much and I couldn’t afford to pay £654 a month plus my mortgage and still have to pay for the service charge and then we could split it into three years. Now the service charge and the major works are costing us about £860 every month. 

“I don’t know what to do. Everyone is worried.”

But it’s not just the finances that are concerning residents in Peckham.

As well as the network leaving residents without the essentials when temperatures are at their lowest and when the UK is being ravaged by extreme weather, there are also environmental concerns to consider. Templer estimated between 65% and 80% of the heat generated from the central boiler system was lost by the time it reached households.

“It’s really expensive for people who live on the system,” he added. “It’s terrible for the environment – we’re talking about a system that burns four times more gas than individual boilers would do. 

“So it’s not better for the environment. And then on top of that, it’s also massively unreliable.”

Residents’ own investigation suggested Southwark Council is overpaying for gas by up to 30%, equating to £1m over the past five years.

Southwark Council told Big Issue one of three boilers in the heating network failed during the weekend cold snap but was fixed by the end of Monday (6 January).

Councillor Sarah King, cabinet member for council homes, said: “Ensuring that residents can afford their bills to keep homes warm and supplied with hot water is extremely important to them, and to us. 

“There appears to be a specific issue with the cost of heating from the network at North Peckham estate.

“We’re committed to looking, in-depth, into this issue raised by residents on the estate. Our investigation is ongoing and we will continue to meet with residents to update them directly.”

The Peckham flats are in the constituency of Labour MP Miatta Fahnbulleh, who is also the government minister for energy consumers.

That remit includes oversight of heat networks and Labour has launched the Heat Network Efficiency Scheme to improve the performance of existing networks.

The bidding process for the £77m grant support scheme is currently open in England and Wales, running until 28 March.

Heat networks are expected to become a regulated utility in 2025, introducing minimum technical standards and giving consumers more protection from sky-high energy bills. 

The government also announced in October that heat network zones would be introduced across six towns and cities across England with construction set to start in 2026.

Backed by £5.8m in government funding, ministers promised the scheme will bring “tens of thousands” of green jobs and use “trailblazing” techniques such as recycling heat from data centres.

Fahnbulleh told the Big Issue: “’I am deeply concerned about the ongoing issues with the North Peckham Heating Network. The lack of heating and hot water during this cold spell is unacceptable.

“I have been actively working with Southwark Council to respond to the issues raised by residents, advocating for clearer communication, greater transparency around service charges, and faster action on repairs. I have also pushed for regular engagement between the council and affected residents to ensure their voices are central to any decisions.

“Nationally, I am leading efforts to improve heat networks through the Heat Network Efficiency Scheme. This work is essential to tackling the systemic issues that heat networks face.

“No resident should endure cold homes or high costs due to failing infrastructure. I will continue working tirelessly to ensure these challenges are addressed both here in Peckham and across the country.”

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