The Government confirmed on 26 November 2024 that it will implement the Clean Heat Market Mechanism from 1 April 2025, according to a summary of the November 2024 Warm Homes Plan announcements published by the National Insulation Association1. The same set of announcements confirmed that 300,000 homes will benefit from retrofit upgrades over the next financial year, 2025/261.
The funding behind that figure sits within an initial £3.4 billion committed to the Warm Homes Plan for 2025/26 to 2027/28, announced in the Autumn Budget the previous month1. That total includes central government grant funding and between £1.4 billion and £1.6 billion of energy supplier-led investment delivered through the Energy Company Obligation (ECO) scheme and the Great British Insulation Scheme (GBIS)1. Approximately £1 billion of the funding has been allocated to the financial year 2025/261.
Alongside the CHMM confirmation, the announcements covered several other policy updates: publication of policy proposals to raise product standards for space heating appliances across Great Britain; additional funding for the Boiler Upgrade Scheme; an award of over £5 million to Ideal Heating through the Heat Pump Investment Accelerator Competition (HPIAC); and removal of the 1m planning restriction for heat pumps1.
"Confirmation of its plans for implementation of the Clean Heat Market Mechanism (CHMM) from 1 April 2025."
The association's summary sets out the following elements of the November 2024 announcements1:
| Announcement | Detail |
|---|---|
| Clean Heat Market Mechanism | Implementation confirmed from 1 April 2025 |
| Warm Homes Plan retrofit | 300,000 homes upgraded in 2025/26 |
| Warm Homes Plan funding | £3.4bn committed for 2025/26 to 2027/28; about £1bn allocated to 2025/26 |
| Supplier-led investment | £1.4bn to £1.6bn via ECO and GBIS |
| Heat pump planning | Removal of the 1m planning restriction |
| Heat Pump Investment Accelerator Competition | Over £5m awarded to Ideal Heating |
| Product standards | Policy proposals published for space heating appliances across Great Britain |
| Boiler Upgrade Scheme | Additional funding announced |
The summary does not give the rates at which the CHMM will operate, the measures eligible under the 2025/26 retrofit funding, or the size of the additional Boiler Upgrade Scheme funding. Those details have not been reported in the summary1.
Why it matters for households
The CHMM places an obligation on boiler manufacturers in relation to the share of low-carbon heating equipment they sell, so its start date determines when those market pressures begin to feed through to the appliances installed in homes. For a household weighing up a replacement boiler or a heat pump, the mechanism is one of the policy levers that shapes what is available and at what cost, alongside the heat pump policy and targets that set the wider direction.
The removal of the 1m planning restriction for heat pumps addresses a rule that affected where certain installations could go ahead, which bears directly on whether a given property can take one at all. The retrofit funding figures indicate the scale of government-supported insulation and heating upgrades expected in 2025/26, though the summary does not set out which measures the £1bn covers or how households access it.
What happens next
The CHMM implementation date is 1 April 20251. The 2025/26 financial year is the first covered by the £3.4 billion Warm Homes Plan commitment, with about £1 billion allocated to it1. The summary gives no further dated milestones for the product standards proposals, the additional Boiler Upgrade Scheme funding or the HPIAC award1.