What Is The Clean Heat Market Mechanism?

​The UK’s heating landscape is undergoing a significant transformation with the introduction of the Clean Heat Market Mechanism (CHMM).

This initiative aims to accelerate the adoption of heat pumps, positioning them as a cornerstone in the nation’s strategy to achieve net-zero carbon emissions.

Given the current policy environment and available financial incentives, now presents an opportune moment for homeowners to consider transitioning to heat pump technology.

Understanding the Scheme

The CHMM is a government scheme designed to promote the uptake of heat pumps by setting specific sales targets for heating appliance manufacturers.

From 1st April 2025 until at least 2029, manufacturers are required to ensure that heat pumps constitute at least 6% of their relevant boiler sales, with failure to meet these targets resulting in a £500 payment per missed heat pump sale!

This policy is intended to stimulate competition, drive down prices, and encourage investment in heat pump supply chains.

What Does This Mean for Manufacturers?

Manufacturers of traditional heating systems now need to do more than just offer heat pumps as part of their catalogue. Under the CHMM:

• Sales Targets: Manufacturers must achieve specified heat pump sales percentages, starting at 6% of the number of gas boilers in excess of 19,999 and the number of oil boilers in excess of 999.​

• Penalties: Non-compliance results in fines, and in response to industry feedback, the government has made adjustments to the CHMM to ease the transition for manufacturers and consumers. Notably, the penalty for manufacturers not meeting heat pump sales targets has been reduced from £3,000 to £500 per missed sale.

• Flexibility: Companies can carry over up to 35% of unmet targets (300 gas and 50 oil boilers) to the following year, or purchase credits from compliant manufacturers.​

Why This Is Good News for Homeowners and Developers?

1. Greater Availability and Choice – With manufacturers prioritising heat pump sales, we’re guaranteed to see more models, improved technology, and better product support hitting the market.

2. More Competitive Pricing – To meet their targets, manufacturers are likely to offer better pricing, deals, and incentives. For example, Worcester Bosch are offering a £500 cashback for every qualifying heat pump installed between 1st April – 31st March 2026.

3. Government Grants Still Apply – The Boiler Upgrade Scheme offers £7,500 grants toward the cost of air source heat pump installations in England and Wales, further reducing the barrier to entry.

4. Long-Term Energy Savings – Heat pumps are around 300-400% efficient, meaning they can produce 3-4 units of heat for every unit of electricity consumed. Compared to boilers, which achieve between 80-90% efficiency, it means that over time this translates into substantial savings on your energy bills — especially when paired with solar panels.

5. Environmental Benefits – Adopting heat pumps reduces reliance on fossil fuels, thereby lowering household carbon footprints. This aligns with the UK’s goal to achieve net-zero carbon emissions by 2050, and assist developers in achieving Part L building regulations. 

Why the Time is Now

There’s momentum in the market, from both the policy and technology side. With manufacturers ramping up supply, installers getting more support, and grants reducing upfront costs, 2025 marks a tipping point!

If you’re building, renovating, or just thinking about switching from gas, now is the ideal time to explore heat pumps. They’re no longer a niche solution — they’re central to the UK’s clean energy future.

To learn more, reach out to our team here!