The City of London Corporation has kicked off a £4.3bn tender race to find a development partner to design, build and run a flagship low-carbon heat network across the Square Mile.

New modelling shows the system could ultimately supply heat to around 1,200 buildings and rely heavily on the River Thames for strategic heat supply.

The 42-year concession will see a single private partner create and run a Special Purpose Vehicle to take the network through design and development to construction and operation.

Under the plan, the City will take no economic return but will hold a “golden share” in the SPV to safeguard governance and key strategic decisions.

Contract signing is targeted for November 2026 following a five-stage competitive procedure.

Recent studies identified around 1,200 buildings that could be mandated to connect under emerging heat-network regulations.

Their combined annual heat demand of roughly 1,000 GWh would require an estimated £1.26bn of heat-network CAPEX to serve – part of a wider system value now expected to exceed £4bn over the life of the concession.

Strategic studies underline that the Thames will play a pivotal role in supplying and transporting heat into the City.

As well as acting as a direct heat source for large water-source heat-pump installations, the river corridor offers a route for big strategic heat mains running west–east along the waterfront.

Proposed long-term Cory Heat Main Project for central London

Indicative route of strategic heat main for both trunk (green line) and branches (blue line)

Short-term options also include thermal barges moored on the river, with Swan Lane pier emerging as the preferred early location for a floating installation. Other mooring points have been mapped and could be activated as demand grows or supply is phased in.

Longer term, the City is expected to rely heavily on three industrial-scale sources: waste heat from Tower Hamlets data centres; rejected heat from Thames Water’s Beckton Sewage Treatment Works, which sheds around 1,029 GWh a year; and a huge supply from Cory’s Riverside Energy Park in Belvedere.

Riverside’s current 917 GWh annual heat output is set to jump to about 3,000 GWh once the new Riverside 2 plant completes.

Cory’s expansion plans were boosted in August when its Heat Main 1 scheme – a strategic cross-London pipe linking the Riverside site to central networks – was designated a Nationally Significant Infrastructure Project, moving it into the Development Consent Order regime for accelerated planning.

Taken together, heat from Riverside 1 and 2 could meet the entire heating load of the Square Mile and even supply half of Westminster’s annual demand.

Cory already handles the City’s residual waste via barge from Walbrook Wharf, providing a long-standing operational link feeding into the new heat-network vision.

The City’s procurement timetable sets an applications deadline of 26 January, interim tenders in March, final tenders in June and a preferred bidder announcement on 5 November 2026. Arup is advising on procurement.