The innovation charity, Nesta, has today welcomed changes to the Boiler Upgrade Scheme’s eligibility criteria but cautioned that delays to the Clean Heat Market Mechanism (CHMM) could lead to uncertainty in a key market for the UK economy.

Madeleine Gabriel, director of sustainable future at Nesta, said:

“Heat pumps are the most efficient low carbon source of heating for people’s homes and the Boiler Upgrade Scheme is helping keep installation costs down for households.

“The strength of the Boiler Upgrade Scheme is that it is a straightforward offer with relatively few restrictions on eligibility. The Government’s announcement today removes further barriers to uptake meaning that even more homes will be eligible to use the grant to install a heat pump. This is good news - in fact, research we published today finds that it is all too easy for consumers to assume they won't be eligible for this kind of Government scheme even when they are.

“Nevertheless, we are concerned that today’s launch of a consultation on delaying implementation of the Clean Heat Market Mechanism sends the wrong signal to a key market for the future UK economy that needs stability to attract the right investment.”

Nesta’s statement follows the UK Government’s publication of its response to a consultation on the Boiler Upgrade Scheme, which provides grants of up to £7,500 to people in England and Wales to install low-carbon heating systems such as heat pumps. In its consultation response, the Government has stated that the scheme will remove the requirement to have no outstanding recommendations for loft and cavity wall insulation  on a valid Energy Performance Certificate (EPC), a change which Nesta called for in its consultation response.

The UK Government today also launched a consultation on postponing the launch of the CHMM scheme to 1 April 2025. The CHMM requires boiler manufacturers to sell a quota of heat pumps, starting with 4 for every 100 boilers they sell in the first year, rising to 6 for every 100 from 2025. If they can’t meet these quotas, they can buy credits from companies selling heat pumps, or pay a fine of £3,000 per missing heat pump.

Nesta today published a report looking at how policymakers could improve current and future subsidy schemes that increase the number of households adopting low-carbon heating systems.