On 21 November 2024 the Department for Energy Security and Net Zero (DESNZ) announced a series of updates and changes to support the UK's transition to low-carbon heating, according to the certification body MCS1. The measures cover funding for the Boiler Upgrade Scheme, the design of the Clean Heat Market Mechanism and planning rules for air source heat pumps in England1.
The Boiler Upgrade Scheme has been allocated an additional £30 million of funding for this financial year, while the budget for grant vouchers is almost doubling to £295 million for the next financial year1. The grant itself remains £7,5001. MCS chief executive Ian Rippin said:
"The £7,500 grant makes switching to heat pumps more affordable and accessible for consumers. By requiring MCS certification, those using a Boiler Upgrade Scheme grant can be confident in the quality and performance of their low-carbon heating installations. We welcome any additional funding and look forward to the continued growth."
A reformed Clean Heat Market Mechanism will be introduced on 1 April 20251. The mechanism is designed to increase the uptake of heat pumps across the UK by setting minimum annual heat pump sales targets for manufacturers1. The announcement stated there will be government support available for every heat pump installation required under the mechanism in 2025-26, as well as a phased approach to ensure supply chains are ready1.
The rule requiring air source heat pumps to be installed at least 1 metre from a property's boundary has been removed, meaning homeowners no longer need to submit a planning application in England1. Rippin said MCS had worked to coordinate the industry's responses and support updates to tools and standards, such as the MCS Planning Standard for Permitted Development Installations of Air Source Heat Pumps (MCS 020)1.
| Measure | Detail |
|---|---|
| Boiler Upgrade Scheme, this financial year | Additional £30 million allocated1 |
| Boiler Upgrade Scheme, next financial year | Budget for grant vouchers almost doubling to £295 million1 |
| Grant amount | £7,5001 |
| Clean Heat Market Mechanism | Reformed scheme introduced 1 April 20251 |
| Air source heat pump siting | 1 metre boundary rule removed in England1 |
Why it matters for households
The boundary rule change removes a planning step that applied to air source heat pump installations in England, which households previously had to clear before work could go ahead1. The extra funding affects the pot from which Boiler Upgrade Scheme grants are paid, and the £7,500 figure is unchanged1. For a household weighing up a switch away from a gas boiler, the grant and the planning position are two of the practical constraints; the eligibility rules and the finance options around an installation are separate matters that this announcement does not address1. The Clean Heat Market Mechanism works on manufacturers rather than on households directly, by setting sales targets for them1. How the reformed mechanism will operate in detail, and what the phased approach means for 2025-26, has not been reported in the announcement as summarised1.
What happens next
The reformed Clean Heat Market Mechanism takes effect on 1 April 20251. The additional £30 million applies to this financial year, and the £295 million voucher budget applies to the next financial year1. No further dates are given1.