District Heating Houses

2022 Heat Price Review Preview

Some residents have asked whether we’re likely to see substantial price rises for our heat, given the changes of gas prices over the last year.

The short answer is “yes”, but perhaps not as bad as it could be. Most of our heat is from gas, but most of what we pay is not related to the price of gas, but to RPI (retail price index) inflation. Sadly, inflation looks set to be high this year.

Our prices are reviewed annually, on 1 March. That’s good news: otherwise we’d paying more already. But come March, we might be in for a shock. I don’t have a crystal ball, but I do have a spreadsheet. I sent a copy of my calculations to Veolia, who said they would comment if I was making any wildly incorrect assumptions. They haven’t commented, so I presume the following is reasonably accurate. Bear in mind that they also don’t know what the price of gas will be in March, or RPI.

Base line

In 2021-2022, we’ve been paying these prices:

Standing Charge: £417.46 per year, though I understand tenants pay a lower price of around £100, but I’m not sure of the exact amount. I don’t know if that’s because Veolia charge less, or because JRHT pay part of the cost as the landlord. 

Unit charge: 6.649p per kWh. This is composed of a Fuel Charge, and a permitted “Margin” of 4.53p. Veolia’s price review letter will illustrate charges with a “typical” usage of 6,300 kWh. Coincidentally, this gives an annual fuel cost of £418.89, almost exactly the same as the standing charge. But, of course your usage could be much lower, or much higher than that.

Price changes.

Price changes are adjusted like this:

  • RPI inflation: The rate published for November was 7.5%. My guess is that RPI will be between 5% and 10%. Some parts of the cost are linked to inflation.

  • Standing charge – this will increate by the RPI inflation rate.
  • Unit charges – these are composed of a fuel price and a margin. You may be able to reduce your heat charge by using less heat or hot water. The unit charge is composed of two elements.
    • Actual fuel prices. We pay the same that Veolia pay for gas and wood.
    • A margin. On top of the fuel charge is a fixed margin, which increases by RPI inflation every year. This is currently the bulk of the unit price that you pay.

Veolia say that their wood chip price hasn’t gone up much: less than inflation. So, I’ve allowed for an increase a bit less than inflation.

However, they buy gas at wholesale prices. Veolia haven’t said how much they’re paying for gas. It’s possible to buy gas well ahead of using it, so the increase may not reflect the prices that you hear in news headlines.

My assumptions for March are as follows:

1. RPI in March will be in the range 5-10%, I modelled 5% in a low scenario, and 10% in high scenario calculations

2. Wood price increase will be moderate, perhaps less than RPI. I modelled 3% in a “low” scenario, and 7% in a “high” scenario.

3. Gas prices will increase two or three fold. I modelled 2x in the low scenario, and 3x in the high scenario.

4. Veolia will continue to target a ratio of 45% wood and 55% gas.

This table shows my calculations for the unit charge. The bottom line shows that the increase might be 20% to 40% – but that depends on the assumptions above. In particular the gas price assumptions, which are the most important, but the most uncertain.

Pence per kWh2021-22Low scenarioHigh scenario
Gas (2x or 3x)
(3% or 7%)
(gas + wood)
Margin (RPI increase)4.534.764.98
Fuel + Margin
% increase in unit price21.0%42.1%
Modelling the possible increase in unit charge, where the “Low” scenario has inflation at 5%, and gas price doubles. The “High” scenario has inflation at 10% and gas price triples. Note that the overall increases are not nearly as high as the gas price increases.


My prediction is that our prices will increase a lot: at least by inflation which could be between 5% and 10%. If you don’t use much heat, then that’s roughly the increase that you’ll see. But if you do use a lot of heat, then the increased fuel cost will be more important, and that could be 20% to 40%, or even more. And the total hit will be somewhere between the two figures, maybe 12% to 25% for a typical user.

I modelled an even worse scenario: with gas prices up by five times, and inflation at 10% and this gave a 75% increase in our heat price, and perhaps 42% total bill increase for a typical user.

Veolia illustrate expected prices with a “typical user” using 6,300 kWh, which we think is about average for a three storey, 3 bed house. Last year, the unit charges added up to about £420: coincidentally about the same as the standing charge, so the total about £840, and I’d imagine that that typical user would see the bill rise by something between £100 in the low scenario, and £200 in the high scenario per year.


My assumptions here could be wrong. Maybe inflation will be higher. Maybe Veolia didn’t get such a good price on gas. On the other hand, inflation could come down below 5% and maybe Veolia have a great price on gas. We’ll find out on March 1.

One more thing: if retail gas prices go up hugely (more than three times), then we might have to add about a penny to our unit charge, due to the “cap and collar” mechanism on our charges. At the moment, we pay a “collar” price, but the Margin on the “cap” price is about a penny higher.

Heating system review

At the request of the Residents’ Association, JRHT have commissioned a review of our district heating system. The aim is to find ways to make the whole system more efficient, so that it becomes more energy efficient. That could make the system cheaper to operate, more climate friendly, and could even reduce your heating bills. Veolia and DRA are cooperating with that review.

Development District Heating Meetings Residents Meetings

ARM follow up

Draft minutes: read on Dropbox or download directly.

22 April: edited to correct the link above, and offer direct download.

Our recent All Residents’ Meeting felt like a great success to me. We had the best attendance that I can remember: at least 70 people were present. That’s more than we’re allowed in the Energy Centre! Some people said they prefer online meetings, for a variety of reasons including child care, anxiety, and mobility. So, we’ll think about mixed meetings, when we’re allowed to use the Energy Centre again.

We had a lot of questions and comments in the chat: nearly 200! Some, we weren’t able to get to on the day. But that’s OK: it means people were able to make points and ask questions that they would not otherwise have been able to make. And I hope to answer some of those questions here.

I grouped together your questions and comments, and won’t repeat them all, but hopefully you’ll find your questions answered here: at least, as far as possible. Oh, I’ve not mentioned any names, but will do if you like!


Can [Angela] recap on what the formal boards who hold JRHT to account are, and how you can join these?

Angela mentioned three boards:

Unfortunately, none meet in public, or publish their minutes, or have resident representation. However, she did say “They have asked that the next … resident engagement strategy is co-produced with residents  and they are keen to consider options for how residents’ voices are heard at the Board- which could include a resident board member. They are very open-minded about options at the moment.” So, we look forward to working to improve that.

But there’s also DPAC which JRHT established with the council before the estate was built, and DGG which JRHT and the DRA established to agree joint policy. And DRA which represents residents to JRHT and other external groups. And lots of community groups, and the Community Activity Network. So there are lots of ways to get involved.


I’d be interested to know how the “future provision” is calculated, benchmarked against those on other communities, and is the money ring-fenced – i.e. in the bank somewhere.

DGG do get a breakdown when consulted on future price changes. Two years in a row DGG have successfully challenged price increases. This year there’s no increase, because we thought the reserves were sufficient. The money is ring-fenced in JRHT accounts, as is usual for this kind of thing.

Is the handover [from DWH to JRHT] complete?

No, but JRHT have taken on some of DWH landscaping work, because their subcontractor ceased working during lockdown. JRHT are charging the work back to DWH pending completion.


Two people were concerned about grass being left to grow. One mentioned that dog waste tends to get left in long grass.

This kind of “meadow management” has been employed to benefit nature, and keep the estate management fee low. DGG is looking at creating a “landscape management plan”, which will set policies after consultation with residents. In the mean time, if you have concern over a particular spot, please let JRHT know, and copy us in!

How can we get involved with the landscaping sub-group?

It’s a proposed subgroup of Derwenthorpe Governing Group. Contact the chair of DGG


What is happening about the central area near the flats?

Sadly, JRHT want to use the compound for phase 5. We don’t want that to happen, but if it does, we’ll push for much better boundaries around the compound so that it’s less of an eye-sore, and to reduce nuisance. We’ve been gathering comments that will us help with this.

We (residents) have been asked to co-design the area for future use. The ABC:D group is looking to develop community facilities generally, and this area in particular. And they’re looking for your help to do it. Please read about what they’re doing, and how you can help them to help you to get a really good focus site for the community.

Will the power lines and tower remain in phase 5?

Yes they will, I’m afraid. Unfortunately, we’re told it proved impossible to get permission to bury the lines from the landowners. Perhaps it would be worth having another go, but the costs of undergrounding power lines are also huge. Probably five or even six figures. 

If the council adopts the roads will this incur any additional cost to residents? 

There is no charge for roads maintenance in the estate management fee. So there should be no costs to us.

Will Seebohm Mews surfacing be part of this? Some of the raised manholes are wicked.

It’s not planned for this year, unfortunately. 

Can JRHT provide plan and timescale for these outstanding works?

Beyond the plans for this year, and phase five by the end of 2022, we’ve not been given any timescales. Sadly, it’s hard to predict these things, so I’d even take those time scales with a pinch of salt.

I think there are going to be a lot of specific questions relating to maintenance (and finishing) parts of the estate. Is there some forum where these questions could be posted and answered after proper consideration?

Yes, we’re looking to set something up. JRHT are, too. I think what’s needed is something where the questions and answers are available to everyone: to avoid duplication, if nothing else! If you have skills in this area, please come forward to help!

How many more phases are there going to be?  Just when I think it’s finished they’re building more? So we’re ending up with less space.

Phase five will be the end of it. The master plan shows no more phases. Even if JRHT wanted to add more, they’d have to go through planning where they’d have a really hard time. But I don’t think they want to. Caveat: the master plan does allow a few more houses on phase three, but I understand the JRHT board has ruled that out.


The standing charge appears to be not good value for money  


What services do we get for the standing charge? 

Supply and maintenance of your heat interface unit, which should be compared with the prices of purchase, installation, and maintenance of the alternative (a gas boiler, or air source heat pump). But mainly, I suspect, the standing charge is imposed to pay the capital cost of the whole system: in the expectation that we won’t be buying much heat. I don’t think it’s worked out that way.

Which measure of inflation do they use [when calculating standing charge increases]?

RPI: as per our heating contracts. There’s an argument that CPI would have been more reasonable!

It does seem unfair to those who try to economise on energy costs that the fixed charge is so high.

Agreed. Perhaps Veolia would agree to a better balance for new contracts, but rebalancing existing contracts would be harder since everyone would have to agree.

Is the system still leaking several m3 of hot water a day/week?

We understand that a large leak was fixed last year.

I seem to remember at a previous meeting of ARM, that there are inefficiencies in the system, through heat loss on the piping to and from the SSC. How is this going to be progressed?

This is a common problem with district heating systems. There are several technical options, and Veolia are working on some of them. The simple options are to modify flow so that the return pipes run cool, and lose less heat. That’s what Veolia are trying. Some systems use 30°C flow and 20°C return, with heat pumps in the houses, and retrofit might be possible: but that is not proposed.

We’re asking Veolia for transparent reporting on system efficiency. It’s important for the environment, but fortunately we don’t pay for the inefficiency: the formula only charges for the fuel used to produce the heat that you consume, not the heat lost to the ground. So, while Veolia then have every incentive to improve the system efficiency, such improvements won’t reduce our costs.

There was some talk about upgrading the consumer units on the late phases a while ago and these upgrade were to be tried in some houses. Was there ever any progress / feed back on this? 

Limited progress was made. The intention was to reduce the return temperature, and therefore the system losses (see above). Veolia think they have another solution to that problem. We’ll try to find out whether that’s worked!

What % of wood chip are they now burning?

They’ve budgeted for 45% in the next 12 months, and say that’s what they burned last year. Up from 5% in the previous 12 months. That’s possible because they recently commissioned a second wood chip boiler, which can be switched on at lower demand levels. 

How are CO2 emissions of gas versus wood chips?

That depends on who you ask! I’ve been checking the academic literature, and it seems to depend on several things. It depends on where the wood comes from, how the land is used later, and so on. Transport costs are important, but one day will be electric lorries running on renewable electricity. The good news is that we could choose to burn more gas, or more wood, without impacting the prices to us: as long as the Renewable Heat Incentive grants offset the higher cost. RHI grants require that we use sustainable source, and we’re told that our wood comes from Yorkshire.

What are they doing to bring the cost down?

The formula doesn’t offer any solutions, I’m afraid. All the inputs to the formula (the price of fuel, and the Renewable Heat Initiative) are outside Veolia’s control. While they’re making a loss, it’s unlikely they’d want to change the contract in a way that brings our costs down. All efficiency improvements would help them, though, which is a good incentive for them to do the right thing by the environment.

Shall we pop a nuclear reactor in there? 😉

Haha! Like, these ones from Rolls Royce?!  I think they’re a bit big, though, apart from anything else!

In the long term, air-source heat pumps can be thought of to install in lofts

Yes, that could offset some of your heat charge, and would work well in Stephenson Quarter where you have MVHR, so could feed hot air directly into all your rooms. We should study the economics. 


Why are the houses so cold in winter so you have to have heating on full, and why are the floors so freezing, and the front door has a constant draft?
Suffer that same, house red hot during summer and ice cold in winter. Can’t put heating on all the time due to cost per unit.

Your house should be airtight. If there’s air leaking into the house, then it needs fixing. The heating system should be able to cope if the thermostat/timer is set correctly. We have some tips on how to keep your house cool in summer in our house guide.

Can we have a thermal camera and someone to inspect houses with a draft

A thermal camera can be borrowed from York Community Energy for a small donation. We’ll think about getting one for the DRA.


Does DPAC advise with regards to service suppliers too? If so, is there any idea or appetite to see if using single suppliers for internet and heating can be reversed over a long term?

That would be DGG, more than DPAC. DPAC is more focussed on development issues; DGG on longer term policies. Each of Veolia and PureFibre has a fixed term contract, at the end of which they’ll compete for renewal. However, the heating contract is 30 years: so a lot can happen before then. The Internet contract may be better as a single supplier, as that allows us to share the infrastructure costs better. For example, if there were two providers, it’s possible that neither could afford to keep an engineer on site. But certainly, residents need to take a big part in shaping the future of both services. 


Solar panels website item will be updated soon. Some 23 houses now have panels as a result of this residents’ group initiative.

That’s a great result, and show what can happen when people work together. I really look forward to a report on the effectiveness of the panels: that could encourage even more people to follow suit.


I’m just going to sum this up by saying we had a really long discussion about this, and that the core team will organise a meeting on the topic!


Pure Fibre are our monopoly Internet Service Provider.

“very good value” “best we’ve ever had. Excellent speed and cheaper than our last 2 providers” “very happy”, though some people are still not seeing the speeds that others are seeing. One said “~20% of what was sold most of the time”, another said “I’m getting 760 down, 920 up at the moment”. You probably won’t see those fast speeds with wifi: you’ll need to plug into the Ethernet sockets in the wall.

Reliability seems much improved since the second uplink (to London) was installed in March 2020 (despite lockdown). We continue to engage with Pure Fibre to keep up to date with what they’re doing, and to push for further technical improvements.


Derwenthorpe in bloom competition?

We don’t have one, but there will be information about our annual Open Gardens event in the next edition of  What’s On…

Energy Centre

Any idea when the SSC will be open for activities like yoga classes?

We don’t know, I’m afraid.


We had a discussion around signage. DGG will pick up the issue, as we need to agree some kind of policy with JRHT.


Thank you for your kind comments.

District Heating Houses


Derwenthorpe resident Catherine Jardine asked Studio Partington -(who designed our houses) for advice about controlling summer heat. We start with some tips on how to use what you’ve got, and then there’s some advice about external shades that you can add. And if you want to learn more, there’s a guide from the NHBC, also written by Partington Studios.

Keeping your house cool

Good ventilation is … key. … Get cool air circulating through the house in the early morning and late evening and then close everything down once the external temperature [is above] the internal temperature (this is second nature in a Mediterranean climate, but not so in Yorkshire!).

The worst time is usually mid to late afternoon, when … heat is coming into the home directly from the sun and when the [air] temperature outside is also high, ….

Richard Partington, Studio Partington

So when it’s going to be a hot day (over, say, 19 degrees), keep your doors, windows, and blinds closed during the heat of the day to stop the house getting too hot: you can’t cool a house down with warm air, even if it is breezy. In the evening, when it’s cooled down again, open windows front and back to get the house cooled down again.

Check the windows and doors section of our house guide, to find out how to prop your windows open safely. Open them front and back, to allow cool air to flow through.

External shading

Some form of sunshading externally will certainly help prevent unwanted solar gains but there are some things to think about if a shading device is retrofitted. Firstly it is much easier to control south facing direct sunlight rather than east or west.

On a south side the sun is high and a structure projecting horizontally from above a window will shade the window by approximately the depth of the projection (sun being at 50 or so degrees height in June).

Low level east and west sun is much harder to control and is usually shaded with vertical fins or some kind of draw down external blind. Both of these are difficult (as is the traditional Mediterranean shutter) with the way we make windows in the UK, which are always outward opening to keep the rain out.

Richard Partington, Studio Partington

Note that close fitting internal blinds can also be effective, if you use them well.

This kind of shade isn’t useful with outward opening windows.

I attach some examples of what can be done as a retro-fit. The … wall will need to support the load of the shade so there will often be struts or cables and fixings at several points back to the brick work.

As with most things the best solutions come from traditional simple to operate means such as shutters, which would work over non-opening windows, but there are more sophisticated and automated systems. The most innovative manufacturer is Renson, who do commercial and domestic shading systems.

The little guide we did a few years ago for NHBC (also attached) explains the problems we are starting too see in well insulated homes and although more of an issue in urban areas people are beginning to be concerned about rural schemes as well.

Richard Partington, Studio Partington

Read more:

Global warming means we’re seeing longer, hotter summers. Air conditioning makes it worse: and is expensive to use, but shading and natural ventilation are free. So we hope this guide will be useful to you!