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Clean Heat Market Mechanism: A new government initiative

Published on 20 December 2023

Posted in Advice & Reviews

by MKM

3 min read

UPDATE: CHMM Postponement 18.03.2024

The government has stated that the response to the Boiler Upgrade Scheme grant increase has been especially positive - with a nearly 40 per cent increase in people applying in January 2024 compared to the same month in 2023.However, the government continues to monitor market developments, and the timeline for the introduction of the Clean Heat Market Mechanism.

The government wants to provide the industry with further time to prepare their businesses, and for more consumers to take up heat pumps, before introducing the CHMM scheme. As a result, the government now plans to adjust the launch of the scheme from 1 April 2024 to 1 April 2025. We will update this blog as and when we have further information to share. 

This initiative aims to drive the transition towards cleaner heating solutions. The CHMM initiative requires boiler manufacturers to substitute or match a minimum of 4% of their boiler sales with heat pumps. Currently, the UK market does not exist at sufficient scale for manufacturers to satisfy the proposed CHMM quotas for heat pumps or hybrid heat pump systems. So what does this mean for you?

Market scale challenge

The UK market lacks the necessary scale for manufacturers to meet the proposed CHMM quotas for heat pumps or hybrid heat pump systems. To offset this levy charge, the manufacturers are passing this cost on.

Will your cost per boiler increase?

Whilst the cost of the product itself is not increasing, the manufacturers are passing the cost of the Levy on, meaning you will pay more.

  • Vaillant - £95 per boiler, all boilers up to 70kw
  • Ideal - £110 per boiler, all boilers up to 70kw
  • Baxi - £120 per boiler, all boilers up to 70kw
  • Worcester - £120 per boiler (oil & gas), all boilers up to 70kw

The sales of both boilers and heat pumps, that are being installed into new build properties are excluded from the CHMM. A levy will be put on boiler manufacturers for each heat pump/hybrid system that don't meet their quota. However, not all manufacturers will be involved. There will be no commercial gain from a supplier or MKM, as this is a levy from manufacturers and not a price increase. This is an unavoidable impact of the policy being imposed upon the industry by the UK Government.

We understand that navigating through these changes may pose challenges. But we are committed to supporting you.

For more detailed information on the manufacturers & boilers included or excluded from the levy, please ask your local branch. We are here to help you understand and adapt to this new legislation. If you have any questions or concerns, please feel free to contact us.

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Read our blogs to find out more about sustainable building tips and advice.