What is the Clean Heat Market Mechanism? (CHMM) Updated 2026
Ryan Gill - Engineer
On 1st April 2025, the UK Government introduced the Clean Heat Market Mechanism (CHMM), an initiative designed to make boiler manufacturers sell more heat pumps.
Here’s an updated guide of everything you need to know for 2026.
How does the Clean Heat Market Mechanism work?
The Clean Heat Market Mechanism (CHMM) was introduced in 2025 with an aim to lower the UK's carbon emissions and support the Government's 2050 Net Zero targets. To achieve this, the Government set an annual goal of installing 600,000 heat pumps in UK homes by 2028.
Instead of placing pressure on homeowners, the CHMM has put the responsibility on boiler manufacturers. Each manufacturer will earn 'credits' for a heat pump installation, and must achieve a minimum number of 'credits' based on their average number of sales, or face a fine.
In 2025, each manufacturer was required to achieve 6% of their total boiler sales through heat pump sales. However, only 125,037 UK heat pump installations took place that year.
After reviewing this policy ahead of Scheme Year 2 (April 2026 to March 2027), the Government has now increased this figure to 8% of boiler sales.*
What is the Clean Heat Market Mechanism levy?
Back in 2024, some manufacturers decided to increase their prices in anticipation of being fined, which became known as the 'new boiler tax' or 'boiler levy'.
As reported, the CHMM levy means for every 92 boilers sold, manufacturers must sell eight heat pumps. If they fall short, companies face a fine of £500 per unsold heat pump.
The fines are passed on to customers in the form of higher prices to cover the losses, leading the policy to be dubbed the “boiler tax”, which comes in the new phase starting on 1st April 2026, adding an estimated £100 to the cost of replacing the appliances.** However, there is no formal government levy on households.
What does the Clean Heat Market Mechanism mean for UK households?
Any household looking to upgrade their boiler can choose whether they switch to a heat pump or stay with a boiler, as boilers will be available for decades to come***, with the government making clear there is no ban on the horizon.**** However, over time, the price of heat pumps may decrease as demand for the products increases. The price of boilers may increase, as manufacturers anticipate greater fines. And the cost of non-renewable energy may continue to fluctuate.****
To support those looking to transition to a heat pump, the Government will be providing a range of funding opportunities through the Warm Homes Plan, including grants, no-interest loans, and low-interest loans. Specifics of the loans and from when they'll be available are to be announced.
“Heat pumps are an excellent low-carbon option for many homes - particularly newer, well-insulated properties - but consumers need to do their research and speak to an expert to check that a heat pump is the right choice for their property and is likely to deliver the energy savings they expect or hope for ” said Angus Struthers, Managing Director at home heating and cooling company BOXT.
He added: “Consumers should try and keep an open mind as replacing gas boilers can often be the most cost effective solution, especially for households facing a heating or hot water emergency and there is no gas boiler ban on existing properties.”
Should I get a new boiler or a heat pump?
Ultimately, this is your decision. It comes down to finding the most suitable product for your home at the best price. For free help and advice, speak with our customer support team on live chat, or by calling 0800 193 7777.
Should I get a new heat pump?
Ground or air source pumps are definitely more pocket friendly than they used to be, due to the government funding (BUS) however, they are not suitable for every home in the UK. They work differently to a traditional gas/oil boiler system in heating the home with lower operating temperatures and are at their most energy and cost efficient in well insulated or ‘new build’ type homes that have large radiators, solar panels or underfloor heating. Most of the older homes in the UK are not as well suited to the wider heating system it requires and drafts and poor or old insulation might result in an inefficient heating output.
What is a hybrid heat pump?
This is a great option for people considering a heat pump but live in less-insulated or older homes. Hybrid heat pumps combine a heat pump and a gas or oil boiler, with an intelligent controller. This enables the system to use the most energy-efficient option throughout the year, and minimise costs where possible.
Should I get a new boiler?
When it comes to a new boiler, for those homes that aren’t well insulated or a non-new build, upgrading your old boiler to a new boiler could be the most cost-effective option, and by upgrading your old boiler it could still help to save over £591 a year on energy bills through improved efficiency.*****
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Get a fixed-price quote**https://www.express.co.uk/news/politics/2128550/ed-miliband-hit-brits-100-pound-boiler-tax-labour
****https://ourworldindata.org/grapher/fossil-fuel-price-index
*****In line with the January 2026 price cap
******Based on the highest proportion of 5-star Trustpilot reviews versus direct competitors.