UK Clean Heat Market Mechanism: Boiler prices may rise £300 as heat pump targets take effect from 2025

The UK's Clean Heat Market Mechanism (CHMM) came into force on 1 April 2025, requiring boiler manufacturers to match a portion of their fossil fuel boiler sales with heat pump installations. Manufacturers that miss the targets face penalties of £3,000 per unit shortfall, which they may pass on to consumers. Reports suggest boiler prices could rise by up to £300, with VAT pushing the added cost closer to £360, lifting a typical installation from £2,000 to over £2,360. Baxi has already added a £120 surcharge to cover potential fines, while other manufacturers warn of larger increases. The scheme applies across the UK until at least 2029 and is administered by the Environment Agency. It aims to support low-carbon electric heat pumps, but the near-term effect on household costs is a key concern for consumers and installers.