- Firms that make boilers and heat pumps are bringing in new charges this year
- The fees of up to £120 per new boiler will pay for expected Government fines
Households are set to pay a ‘boiler tax’ of up to £120 when buying a new one – because manufacturers believe they will miss heat pump installation targets.
The Government will fine boiler and heat pump makers from April if they are not fitting enough heat pumps.
But these manufacturers already think they will miss these targets, and say they will have to increase boiler costs in response – with some already charging consumers extra.
The Government’s Clean Heat Market Mechanism (CHMM) gives each manufacturer of gas and oil boilers credits for fitting a certain number of heat pumps per year.
Out with the old: Getting a new gas boiler fitted this year could mean paying extra
The Government is set to say that heat pump installations are 4 per cent of firms’ boiler sales for 2024/25, rising to 6 per cent in 2025/26.
If manufacturers do not meet their individual targets then they face fines of £3,000 per missing credit.
The aim of the scheme is to lower the UK’s carbon emissions and increase the energy efficiency of households by encouraging more heat pump installations.
But boiler makers such as Baxi, Ideal, Worcester Bosch and Vaillant have said they will have to pass the cost of these fines on to consumers in the form of higher prices for boiler installations.
Vaillant said its boilers would increase in price by £95, Ideal’s prices by £110 and the cost of Baxi and Worcester Bosch boilers by £120.
Getting a boiler fitted typically costs between £1,500 and £5,000, depending on the size and type required.
To encourage homeowners to make the switch, the Government offers Boiler Upgrade Scheme grants of up to £7,500 to get a heat pump.
The Government has previously criticised the way boiler and heat pump makers pass on the expected cost of future fines.
In with the new: Homes are being nudged towards greater heat pump uptake by Government
A spokesman for the Department for Energy Security & Net Zero said: ‘We are not imposing a boiler tax and any suggestion otherwise is completely inaccurate. We have looked into the figures from manufacturers and do not recognise their reason for imposing these costs onto hardworking families.
‘Targets under the CHMM are realistic and achievable, and manufacturers have failed to recognise they can carry over up to 35 per cent of their heat pump targets under the scheme into the subsequent year.
‘We’ve also made for it easier to get a heat pump by increasing the Boiler Upgrade Scheme grant by 50 per cent to £7,500 – tripling applications in the week after it was rolled out.’
Mel Butler, founder of boiler fitter Boxt, said: ‘Whilst the move to cleaner heating in the UK is something we are absolutely supportive of, the people who are ultimately paying with this policy are homeowners.
‘Our worry is that this will create a substantial financial barrier for some homeowners and could result in them opting for a less efficient or reliable boiler with a shorter warranty to help reduce the initial outlay, but is likely to ultimately cost them more in the long run in maintenance, repairs, and potentially having to replace it again sooner.’
Baxi, Ideal, Worcester Bosch and Vaillant did not comment.