This year has been a particularly unusual and uncertain year for boiler installations, with several new laws and standards that managed to confuse a lot of people before a change of government put these new plans into question as well.
The rollout of heat pumps only started to pick up in the middle of the year, the future of hydrogen boilers was in doubt, and conventional boilers increased in price somewhat dramatically as a response to a proposed Clean Heat Market Mechanism (CHMM).
Because everything was changing so quickly, homeowners, installers and manufacturers alike were not entirely certain about what to do when people needed to install a new boiler, what to replace it with and how much it would cost.
The prevailing advice is that regardless of what happens in the distant future, there is unlikely to be a mandate forcing people to rip out new, economical boilers, and ultimately that view has not only been vindicated but could potentially make people £120 richer.
To explain this, it is important to look back at the CHMM, how it affected the market and what is going to happen next.
“Boiler Tax”
In 2023, plans were put in motion by the then-government to incentivise current boiler manufacturers to also sell heat pump systems, requiring them to sell a certain number of heat pumps relative to the boilers they sell, with fines relative to how far they fall short of this target.
Initially, the proposal was set to start in April 2024 and would charge companies £3000 multiplied by how many heat pumps they fell short of the four per cent of total sales target, although the exact charges and weightings varied tremendously.
It was characterised as a “boiler tax” in media reports although this was a misnomer, but many manufacturers responded to the potential extra expense by increasing the prices of their boilers by as much as £120.
In particular, Worcester Bosch, Baxi, Ideal and Vaillant (also sold as Glow Worm) all increased their prices by £120, £120, £110 and £95 respectively. Some manufacturers such as BOXT, froze their prices and did not charge extra.
This meant that distributors and installers had to make the difficult choice of eating the cost or passing it on to customers, meaning that a lot of people who had boilers installed at the start of the year paid up to £120 more than they were supposed to.
It became controversial for a lot of reasons and led to a lot of finger-pointing between manufacturers and the government about who was to blame for increasing the prices of potentially money-saving boilers during the tail end of an energy crisis and in the middle of a cost of living crisis.
The plan was delayed in April and it has been suggested by statements by new Energy Secretary Ed Milliband that it will be dropped entirely following the change in government and alternative priorities for the energy market.
As the extra charge was a precautionary measure at the manufacturer level, homeowners are only eligible for a refund if the costs were passed on to them, so it is important to get in touch with your installer if you feel this was the case and have not received that money.
