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2023 – the good, the bad and the ugly

Eoin McManus
CEO, Lyrical Communications (Installer and elemental)

2023 was a bit of mixed bag – lots of good stuff, some not so good, and just recently the industry’s reaction to the Government’s Clean Heat Mechanism was a bit ugly.

On the bright side, it was another good year for small scale renewables – with data from MCS (Microgeneration Certification Scheme) showing that UK homeowners are turning to renewables and installing low-carbon energy and heating technologies in record numbers.

There were over 183,022 certified solar PV installations across the UK in 2023, exceeding the 138,000 in 2022 by a third.
It was also a record year for heat pumps, with more than 37,000 certified installations registered. In October this year, the grant value for heat pumps was increased to £7,500, which saw the average weekly applications for vouchers soar from 331 to 1,172.

This is all good news – things are heading in the right direction, but there’s still a long way to go.

It’s bad news for renewables, however, when the Government ‘adjusts’ the ban on the sale of new oil boilers by almost a decade. In September, Prime Minister Rishi Sunak announced a ‘new strategy’ – and moved the goalposts which wouldn’t have delighted the heat pump industry. New technology will only have to be put in when people replace their existing boiler and poorer households “will never have to switch at all”.

“We’re changing the way we reach Net Zero by 2050 to ease the burden on working people,” said the PM.

Fair enough, you might say, but behind the headlines there’s increasing pressure on the PM from the right of his party and an election coming up in 2024 where the Tories are trailing badly in the polls. So, is this really about easing the burden on working people, or just cynical electioneering?

And finally, things got a bit ugly with the recent announcement that the Clean Heat Market Mechanism (CHHM) will launch in 2024. Essentially the aim of the CHHM is to incentivise the UK’s heating industry to invest in making heat pumps an increasingly attractive and affordable choice for families and businesses.

This controversial initiative will fine gas and oil boiler manufacturers if they don’t sell a percentage of heat pumps compared to their boiler sales. The idea is that this will increase the number of heat pumps installed in the UK and lower heat pump prices. Mmm, will it?

However, some have argued that the CHMM is unfair on traditional boiler manufacturers and could lead to increases in boiler prices if fines are passed on to the installer and end user. Which inevitably they will. Under the Mechanism, a £3,000 fine will be charged for every missed heat pump sale.

Writing on InstallerONLINE, Heating Engineer Andy Gibbs doesn’t beat around the bush – “It’s a tax on boilers,” he says. “So, let’s call it what it is, a boiler tax”.

Not surprisingly, the heat pump lobby is very supportive of this initiative, but the reality on the ground is far less enthusiastic – especially when the cost of a new boiler could, it’s predicted, rise by as much as £300.

One thing is for sure, 2024 will be an interesting one. We’ll have lots to talk about and lots to agree and disagree about. But the climate change targets are still in place, the deadlines are still there – we just need clarity from the Government, whichever colour it turns out to be, and a little less flip-flopping.

Our industry is responsive, it always has been.

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