How Heat Networks Will Shape London’s Construction Sector in 2026
As London moves closer to its 2030 net-zero ambitions, the way the city heats its homes and buildings is set for a major transformation.
This week, the London Assembly Environment Committee is launching an investigation into heat networks, the underground energy systems that distribute heat from a central source to entire districts of buildings, including homes, offices, hospitals and public buildings.
More than 477,000 households in the UK are already connected to heat networks, serving around 1.1 million people. The Government wants that figure to rise dramatically: from 3% of total heat demand today to 20% by 2050.
For London, the target is even more ambitious. The Mayor’s Net Zero Pathway relies on 460,000 heat network connections by 2030, a goal that will require rapid expansion of both infrastructure and technical expertise.
The London Assembly will question whether the capital is on track to meet that target, and what impact the new national heat network zoning policy will have. The policy will allow certain types of buildings ,and low-carbon energy sources, to be required to connect to a network within a set timeframe.
For the construction industry, this signals significant opportunities and challenges. Delivering heat networks at scale demands a combination of civil engineering, M&E installation and urban planning. It involves laying insulated underground pipework, integrating energy centres into new and existing developments, and ensuring connections to low-carbon sources such as waste heat, data centres, or energy-from-waste plants.
It also raises complex questions about retrofit feasibility, planning permissions and supply chain readiness. For contractors, developers and consultants, this is an emerging market, one that will likely shape a new wave of public–private investment in London’s energy infrastructure.
As the capital pushes towards decarbonisation, collaboration between local authorities, developers, M&E contractors and technology providers will be essential. Projects like King’s Cross Energy Centre, Greenwich Peninsula’s district energy network, and Southwark’s SELCHP integration already demonstrate what’s possible, but scaling these systems across London’s 3.6 million homes will require a coordinated, long-term strategy.
The construction sector sits at the centre of this transition. As London’s buildings evolve from isolated heating systems to connected, city-scale energy networks, the industry’s role is not just to build, but to connect, integrate and future-proof.
