The government confirmed on 30 November 2023 that a new Clean Heat Market Mechanism will launch next year, alongside figures showing that applications to the Boiler Upgrade Scheme tripled in the week after the grant for a heat pump rose to £7,5001. The Department for Energy Security and Net Zero said the mechanism "will incentivise the UK's heating industry to invest in making heat pumps an increasingly attractive and affordable choice for families and businesses"1.
New applications to the Boiler Upgrade Scheme reached 1,150 in the first week after the uplift, more than three times the average weekly rate before the change, and remained nearly 60 per cent higher than the previous weekly average over the following three weeks1. The scheme, which is available in England and Wales, provides financial support to switch from fossil fuel heating to a heat pump, and the department said the 50 per cent increase makes it one of the most generous of its kind in Europe1. Weekly application figures cover the start of the scheme on 23 May 2022 to the week ending 13 November 2023, while separate delivery statistics run to 31 October1.
The government also said it will consult on introducing new permitted development rights to end the blanket restriction on heat pumps one metre from a property boundary in England1. That followed an independent review of air source heat pump noise, carried out by WSP, BSRIA, the University of Salford and Stephen Turner Acoustics, which concluded that heat pumps are now very quiet, with sound levels similar to a gas boiler or fridge, and recommended changing planning rules while strengthening installer noise assessments1.
"Today's new figures show our pragmatic approach to net zero is working. In the first week after our 50% increase to the Boiler Upgrade Scheme, applications tripled."
The mechanism's timing has since moved. It was originally due to be implemented on 1 April 2024, but in March 2024, two weeks before that start date, the government postponed it by a year to 1 April 20252. Under the design described, manufacturers would have to ensure at least 4 per cent of their sales are heat pumps rather than gas boilers, extending to 6 per cent in the second year, with a £3,000 fine per missed installation2. The aim is to support the government's target of 600,000 heat pump installations a year by 20282. Some manufacturers added a so-called boiler tax to gas and oil products ahead of the original start date and are now returning that money through distribution companies or installers, which does not necessarily mean the end user receives the rebate2. Hybrid systems currently count for half a credit under the mechanism but do not qualify for Boiler Upgrade Scheme funding2.
| Item | Detail |
|---|---|
| Boiler Upgrade Scheme grant | £7,500 per heat pump installation1 |
| Applications, first week after uplift | 1,150, more than 3 times the prior weekly average1 |
| Applications, following 3 weeks | Nearly 60% above the prior weekly average1 |
| Mechanism sales requirement | At least 4% heat pumps in year one, 6% in year two2 |
| Penalty | £3,000 per missed installation2 |
| Original start date | 1 April 20242 |
| Postponed start date | 1 April 20252 |
Why it matters for households
The Clean Heat Market Mechanism works on manufacturers rather than on households directly, so its effect on a home is indirect: it is intended to shift what heating equipment is made, stocked and priced. The confirmed grant level and the application figures show how sensitive uptake is to the upfront cost of a heat pump, and the proposed planning changes would remove one of the consent hurdles that can add cost and delay to an installation in England. The postponement to 1 April 2025 means the pressure on manufacturers' sales mixes begins a year later than first set out, and the treatment of hybrids differs between the two policies, which affects which systems attract support. For a household weighing up a switch away from a gas boiler, the practical picture is a larger grant, a possible easing of planning rules, and a manufacturer obligation whose start date has moved. The policy targets and rules behind these measures, including the 600,000 installations a year aim, set the context in which grant levels and equipment prices may change.
What happens next
The government said it will consult on new permitted development rights for heat pumps in England1. The Clean Heat Market Mechanism is due to start on 1 April 2025 following the one-year postponement2. No further dates for the consultation or for the mechanism's detailed rules have been reported.
Sources2 cited
- Heat pump applications surge after increase in government grant - GOV.UK, gov.uk
- At Boiling Point: Why the ‘Boiler Tax’, alpha-innovation.co.uk