Council heat network hits customers with 25% price increase

A councillor in Hackbridge has said he is “shocked and concerned” after a Sutton Council-owned heating network increased its prices to residents by 25per cent.

Not all there: New Mill Quarter has 725 homes. SDEN’s financial plans are based on 800

Sheldon Vestey, a Labour councillor, told Inside Croydon, “This jump in pricing is completely unwarranted and unfounded based on the pricing model set out by SDEN.”

SDEN is the Sutton Decentralised Energy Network, which is the monopoly heating and hot water supplier to the Barratt-built New Mill Quarter in Hackbridge. New Mill Quarter was supposed to be guaranteed inexpensive “green” energy by SDEN, which was to pump through water heated by the Viridor incinerator at Beddington.

But the incinerator link has never been made operational and the only thing that SDEN has delivered to its NMQ customers is a series of heating outages through cold winter months, high tariffs and an endless stream of problems.

The LIberal Democrat-controlled Sutton Council’s use of public money and grants for SDEN has repeatedly raised allegations of fraudulent practice around the manner in which the company was established and is operated.

The latest price hike, according to Vestey, has been accompanied by “Misleading practices employed by the council in not providing customers with a true like-for-like comparison, by leaving VAT out of pricing where it does not normally do so”.

Shocked: Sheldon Vestey

Vestey said, “Customers are rightly confused to see old pricing including VAT and new pricing without VAT. It is clear that this has been done to mask the full extent of the price increase.”

Sutton Council and SDEN have been reprimanded in the past for using a “heat cost calculator” from the Heat Trust in their publicity and were forced to remove the Trust’s logo from their website. But SDEN has used the Heat Trust’s heat cost calculator in their most recent materials.

“Simply put,” Vestey said, “the council is using data not as it was intended, in a manner it was specifically advised not to do.

“How has this passed any sort of internal approval?” Vestey asked, “especially after another 10-hour heating outage in the depths of winter?”

He said, “Consumers have no way to leave this business or access alternate heating as the council continues to authorise higher and higher standing charge levies without justification and imposes unit charge increases above and beyond the rest of the market.

“SDEN pricing has always been unhinged from the market, launching at over 6p/kwh when the wholesale gas price sat less than 2p. Without this, the business would have been assessed as not commercially viable.”

Vestey has written to Sutton Council asking it to address the matter urgently, including a pledge to review both the standing charge and fixed charge.

“This is the only option I can see as being transparent and honest with residents.”

Read more: Bailey holds urgent talks seeking Viridor bail-out for SDEN
Read more: Heat network’s plan depends on 75 homes that don’t exist
Read more: Opposition renews call for full-scale fraud probe into SDEN
Read more: Sutton heat network director quits as fraud inquiry begins

About insidecroydon

News, views and analysis about the people of Croydon, their lives and political times in the diverse and most-populated borough in London. Based in Croydon and edited by Steven Downes. To contact us, please email
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