Hot Topics: The Potential of Energy-from-Waste Heat Networks

2026 is due to be a transformative year for clean heat in the UK. From January, UK heat network regulations are evolving into a new regime, bringing them under Ofgem's oversight, requiring Ofgem authorisation and mandating enhanced consumer protections. In addition, the Government is currently (i) identifying the areas of England where heat networks are the lowest-cost and lowest-carbon intensive heating solution; and (ii) drafting regulations which will mandate that certain buildings in those areas connect to heat networks.

This regulatory overhaul is all part of the UK Government ambition to accelerate the expansion of heat networks to deliver 20% of our heat demand (from c.3% of heat demand currently met) to enable the UK to reach its net zero ambitions by 2050 and, back in November 2025, the Environmental Services Association (ESA) published a guidance document intended to show the potential for energy-from-waste (EfW) facilities to help in this transition. 

What is the opportunity offered by EfW facilities?

Heat networks operate by taking heat from a central heat source and supplying it to consumers via a network of insulated pipes carrying hot water, avoiding the need for individual gas boilers or electric heaters in every building. To deliver on their potential, heat networks require (i) a consistent supply of heat from one or more centralised low-carbon sources; and (ii) reliable consumer demand for the supply of heat. 

As a reminder, in November 2025, the Energy Services Association published some very useful resources: Energy-from-Waste Heat Networks - a Guide to Heat Offtake which includes a checklist of questions for EfW operators and heat network developers to refer to in setting up successful EfW heat offtake arrangements. There is also an interactive online Heat Network Prospectus which plots EfW facilities on a UK map and allows users to access critical information about the heat potential of each facility.

The Guide highlights that:

• there are currently 63 fully operational EfW facilities in the UK (with another 13 sites under commissioning)

• 10 EfWs are currently exporting heat

• if the current fleet of EfW facilities in the UK connected to heat networks, EfW heat export could be increased from 1,770 GWh to over 20,000 GWh (equivalent to nearly 1.5 million homes switching away from gas) with potential savings of £4,000 to £22,000 per household over a 25-year period, compared to gas boilers or heat pumps.

The Guide highlights a number of key opportunities that EfW facilities present for heat network developers, including:

1. they produce a vast amount of heat during the combustion process on a consistent basis with such facilities, on average, having availability of nearly 90%  

2. They can provide high-grade heat (often above 100°C, sometimes over 400°C) representing high-quality, versatile energy for distribution to buildings for space heating and hot water

3. the heat is generally considered to be “carbon-free” as the carbon dioxide emissions produced during combustion of waste are attributed to the waste treatment process, rather than the utilisation of heat as a by-product. 

4. they are often co-located on industrial sites and near to densely populated areas and so often have consumers who require a regular supply of heat in close proximity – offering heat network developers reliable demand and reduced infrastructure costs for installing heat network connections compared with other more disparate offtakers. 

Key considerations 

Whilst there is clearly a potential role for EfW facilities in delivering heat networks at scale, there are several key issues for both EfW operators and heat network developers to consider before entering into a heat offtake arrangement:

Asset age: it is important to ensure that the heat source will be operational for an appropriate amount of time to secure investor confidence and reliable supply of heat – some EfW facilities are aging and may need to be replaced or retired, which might impact availability. Some will also be subject to PFI arrangements with local councils which will be coming to an end in the near future and so it will be important to understand what will happen to the asset on expiry of that arrangement. 

Availability: heat networks require a reliable heat source to operate successfully. Whilst EfW facilities generally have high availability of c.90%, they may be subject to planned and unplanned shutdowns and so there will need to be an alternative heat source (or sources) capable of delivering the equivalent heat demand in the event of a shutdown.

Types of heat: EfW facilities can produce different types of heat, being direct heat offtake, flue gas recovery and low-grade heat recovery. The source and type of heat will impact the scale and temperature of the available heat and may also impact the suitability of an EfW facility as a heat supplier.

Cost and Pricing: where EfW facilities forego electricity production (and associated revenue streams) to produce heat, there needs to be a robust business case which supports the shift to heat production to get the necessary buy-in from investors. This, combined with the high upfront cost of the heat network infrastructure to support the distribution of heat, can impact on the ability of EfW operators to provide heat at an affordable cost.

Next steps

Government policy in the heat network sector is still evolving, with the response to the consultation on heat network zoning held in 2023 still awaited, and the EfW sector is undergoing its own changes with its inclusion in the UK Emissions Trading Scheme on the horizon, waste sector carbon capture and storage projects starting to come on-line, waste-to-x technologies eyeing EfW waste streams and long term PFI/PPP concession arrangements coming to an end. Whilst there might be challenges, it’s clear that there is great potential for the synergies between these two sectors to be exploited and to contribute towards achieving the Government’s circular economy and net zero ambitions.

Burges Salmon has a market leading circular economy practice with experts across the heat, waste and energy sectors. If you would like any further information, or advice related to any of the information in this article, please contact Nick Churchward, Emma Andrews, Charles Robson, Greg Fearn or your usual Burges Salmon contact. 

This article was written by Nick Churchward, Greg Fearn and Imogen Drummond.

2026 is due to be a transformative year for clean heat in the UK