Blog/District Heating Networks: How They Work and Their Benefits
Energy renovation

July 25, 2026

5 min read

Updated August 31, 2026

District heating networks: renewable share, classification and the duty to connect

On a district heating network, one figure drives the whole file: the share of renewable and recovered energy. From 50% upward it opens the 5.5% VAT rate on the heat supplied, allows the network to be classified, and triggers the duty to connect above 30 kW inside the priority development perimeter. Here are the values to record before pricing a substation, and the texts that set them.

Contents

On a district heating network, the figure that drives the whole file is the share of renewable and recovered energy. According to the FEDENE 2025 survey covering the year 2024, France has 1,041 heating networks, with an average renewable and recovered share of 67% and an average carbon content of 0.109 kg CO2 (life cycle) per kWh delivered; 911 networks are above the 50% mark. That 50% threshold is not indicative: it opens the 5.5% VAT rate on the heat supplied under section B of article 278-0 bis of the French tax code, it conditions the network classification set out in article L712-1 of the energy code, and it is that classification which makes connection compulsory above 30 kW inside the priority development perimeter. Before pricing a substation, ask the operator in writing for the network's share, because it changes the gross price the owners' association sees.

What a district heating network changes on site

The delivery point replaces the boiler room, not the emitters

Production is centralised in a heat plant, the heat circulates in buried flow and return mains, and the building receives a delivery point. What you strip out is the generator and its fuel storage; what you keep is the emitters, the risers and the hot water secondary loop. The contractual boundary sits at the substation flange: beyond it, the network operator; short of it, the building and therefore your contract. That component is covered in detail in our article on the district heating substation.

What the survey has to bring back before any pricing

Four figures drive the study: the flow and return regime guaranteed by the network, the capacity available at the connection point in kW, the distance to the existing main, and the capacity currently installed in the boiler room. That last one is not an administrative detail: it is what triggers the duty to connect, or not. Also record the number of dwellings served, a figure the certificate file requires.

Which buildings are candidates, and which are not

Connection targets buildings close to an existing main with a steady demand first: multi-unit housing, social landlords, commercial premises, public facilities. A detached house can still be connected, but the connection cost set against the contracted capacity degrades the case quickly. Highly intermittent demand sits badly with a contracted capacity charge that is billed whether or not it is called on.

Network classification and the duty to connect

What a classified network is, and on what conditions

Article L712-1 of the energy code makes classification subject to three cumulative conditions: the network must be efficient within the meaning of article L711-4, meter the energy delivered at each delivery point, and secure the financial balance of the operation over the depreciation period of the installations. The 50% renewable and recovered threshold is assessed across all the energy injected into the network. The local authority may refuse classification by reasoned resolution.

Priority development perimeter and the 30 kW threshold

Once the network is classified, the local authority delimits one or more priority development perimeters. Inside that perimeter, article L712-3 requires connection of the installations of a new building, and connection when a heating, cooling or domestic hot water installation rated above 30 kW is replaced. The threshold is assessed on the installation in place that is being replaced, not on the intended one: a 200 kW boiler room replaced by a 25 kW solution is still caught.

Derogations: who grants them, and on what grounds

The obligation does not rule out standby or supplementary plant. A derogation may be granted by resolution of the local authority, after consulting the network operator. It is applied for upstream, not at planning submission: a derogation refused after the equipment has been ordered means redoing the whole study. Where connection is not imposed, the comparison is made case by case, as set out in our comparison of heat pumps and district heating.

Temperature regimes, hydraulics and hot water

Matching the flow and return regime to the emitters in place

The network sets its regime and the building adapts. A stock of cast iron radiators sized for high temperature takes a hot primary without trouble; underfloor heating requires a mixing stage on the secondary. The point to check is not the flow but the return: most contracts penalise an over-warm return, which reflects excessive flow on the secondary side. The available regimes and their consequences for emitters are set out in our article on high, medium or low distribution temperature.

Balancing: the item that decides the bill

An unbalanced secondary circulates more water than needed, pushes the return temperature up and triggers the contractual penalty while degrading comfort in the furthest dwellings. Balancing is therefore not a finishing task but a condition of the connection paying for itself. The method and the measurement points are described in our article on balancing the heating circuit.

Hot water: instantaneous or stored, and what it costs in contracted capacity

An instantaneous exchanger removes storage and the associated legionella risk, but draws a high peak load, hence a larger contracted capacity and a dearer standing charge. Storage flattens the peak and lowers the contracted capacity, at the price of a volume held at temperature and a sanitary protocol. The trade-off is made on the building's real draw-off profile, not on a per-dwelling ratio.

Tax and grants: the thresholds that move the net cost

VAT: the standing charge and the heat itself follow different rules

This is the item most often mispriced at the owners' meeting. The standing charge for heat energy distributed by a network carries the 5.5% rate whatever the production sources. The heat supplied only qualifies if the network clears the 50% threshold, assessed network-wide over the previous calendar year.

Bill line Condition VAT rate Basis
Standing charge for heat energy no condition on sources 5.5% Tax code, art. 278-0 bis, B
Heat supplied, network at 50% renewable or above threshold assessed per network over year N-1 5.5% Tax code, art. 278-0 bis, B
Heat supplied, network below 50% outside the reduced rate 20% standard rate
Service connection and substation, dwelling over 2 years old improvement works 10% Tax code, art. 279-0 bis

Do not stretch the 5.5% rate to the works themselves: connection to a district heating network does not appear in the list at article 30-0 D of annex IV of the French tax code. Only the items expressly named there, such as heating controls or pipework insulation, follow the 5.5% rate; the service connection and the substation fall under the 10% improvement works rate.

Energy saving certificates: the BAR-TH-137 figures

Connecting an existing residential building is claimed through standardised operation sheet BAR-TH-137, whose version A79.4 applies to operations committed since 1 January 2026. The conventional lifetime used is 30 years. The evidence of completion is not the works invoice but the heat supply contract, and the completion date is the date it takes effect.

Dwelling type Zone H1 Zone H2 Zone H3 Multiplier
Multi-unit, per flat 47,700 kWh cumac 39,500 kWh cumac 30,800 kWh cumac number of flats connected
Detached house 48,300 kWh cumac 40,200 kWh cumac 29,600 kWh cumac 0.5 if S < 70 m², 0.7 if 70 ≤ S < 90 m², 1 if S ≥ 90 m²

Two conditions regularly block files: the building must not have been connected to a heating network during the five years preceding the commitment of the operation, and any earlier connection must not already have been the subject of a certificate claim.

Building the funding plan before the owners' meeting

In a multi-unit building the decision is taken on a net cost, not on a technical specification. Assemble in one document the connection cost, the substation, the internal adaptation, the certificate bonus computed from the figures above, the collective grants available and the VAT rate line by line. MaPrimeRénov' amounts are checked at the date of commitment, the schedule having been tightened several times on standalone measures. That plan is built directly alongside the pricing when the grants, the certificate bonuses and the monthly instalments are deducted to show the net cost before signature.

Key figures

67%

Average renewable and recovered share, 2024 data

1,041

District heating networks recorded in France in 2024

30 kW

Duty-to-connect threshold, energy code art. L712-3

Frequently asked questions

50%. Section B of article 278-0 bis of the French tax code applies the 5.5% rate to heat produced at least half from renewable sources within the meaning of article L211-2 of the energy code, or from a process whose purpose is not heat production. The tax administration's guidance specifies that the threshold is assessed network-wide, over the previous calendar year. The standing charge itself carries the 5.5% rate whatever the sources.

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Louis Meneteau

Louis is CPO of Argile. An engineer by training, he spent four years validating calculation software in systems engineering, then three years in software product. He turns the installer's daily reality into product workflows: technical survey, sizing, quotes and subsidy files. His articles describe field gestures rather than principles, because he watches them on site before specifying them.

Further reading

Camille Martin

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Works plan

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Financing

Whole-house retrofit

Generate the quote

Works

Financing

Cost of works and grants

Total cost of works

4 jobs

INSULATION

External wall insulation

18 400,00 €

Windows

3 260,00 €

HEATING AND HOT WATER

Air-to-water heat pump

14 900,00 €

Heat-recovery ventilation

1 840,00 €

Total amount

38 400 €

Grants

3 grants

MaPrimeRénov’

9 200,00 €

Energy saving certificates

3 480,00 €

Regional grant

1 520,00 €

Add a grant

Total grants

− 14 200 €

Remaining cost

Cost of works

38 400 €

Grants deducted

− 14 200 €

Grants land once the works are done: the financing plan covers the advance.

Remaining cost

24 200 €

Financing plan

How the works are paid for before the grants land at the end of the site

Loans

1 loan

Prêt Ecair

24 200 € · 15 ans · 3,4 %

Instalment

212 €

Ecair

Empruntis

Sofinco

Total borrowed

24 200 €

Advances on the grants

3 grants

The grants are advanced to the customer so they do not wait for the end of the works.

MaPrimeRénov’

9 200,00 €

Energy saving certificates

3 480,00 €

Regional grant

1 520,00 €

Total advanced

14 200 €

Personal contribution

No contribution asked on this project

Total contributed

0 €

With argile

The out-of-pocket cost, announced without nasty surprises

Public grants, energy-saving certificate bonuses and financing built into the pricing: the customer sees the real cost of their project, what is left to pay and their monthly instalments before signing.

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