Patrick Harvie has urged the UK Government not to bow to pressure and phantom fears over a so-called “boiler tax” amid warnings a U-turn on a key heat pump regulation could leave “a gaping hole” in climate ambitions.
The UK Government has vowed to launch the Clean Heat Market Mechanism (CHMM) in April of this year, which would require fossil fuel boiler manufacturers to install a certain number of heat pumps proportionate to boiler sales.
The policy is a key method to incentivise the industry to invest in clean heating systems and help bring down the price of heat pumps.
The CHMM will ensure that 4% of sales by manufacturers and suppliers are made up of heat pumps in the 2024-25 financial year, with the proportion set to rise to 6% in 2025-26.
Read more: Analysis: Let's not blow cold over heat pumps win
But some within the gas boiler industry have wrongly claimed that the CHMM will significantly increase the cost of boilers, despite the policy not requiring suppliers to raise prices.
The industry is pondering imposing a levy on new boilers to cover the costs of penalties incurred by failing to meet the CHMM – with the threat of £3,000 fines for each missed heat pump installation.
The UK Government has investigated the industry claims but has said it does “not recognise their reason for raising prices for hardworking families”.
In November, the UK Government pledged to “proceed to introduce scheme regulations to Parliament…in advance of the start of the first scheme year in April 2024”.
But the UK Government is facing pressure to U-turn on the plans – after Rishi Sunak rolled back other key net zero policies to help drive a wedge with Labour ahead of this year’s general election.
Lord Callanan, the UK Energy Efficiency and Green Finance Minister, has issued a warning that "vested interests" are "funding campaigns of misinformation" about heat pumps.
Read more: Scotland's leads UK for heat pump installations but 'more work to do'
Ill-informed concerns about heat pumps have gained traction and potentially put people off installing renewable heating systems, including the false claim they will not work during Scotland’s cold winters.
The technology is popular in Scandinavian countries with harsher winter weather than Scotland – but insulation improvements are needed in homes alongside installing a heat pump to be most effective.
UK Net Zero Secretary Claire Coutinho has suggested her government is looking at the policy very carefully, while a government spokesperson told The Herald on Sunday that “no decision has yet been made” on whether the CHMM will proceed as planned.
UK Climate Minister Graham Stuart is reportedly ready to resign if the CHMM policy is reversed.
The UK Government’s 2020 energy white paper committed to “growing the installation of electric heat pumps, from 30,000 per year to 600,000 per year by 2028".
UK-wide, the CHMM policy is forecast to produce 200,000 heat pump installations a year – covering one-third of the 2028 target.
But the UK Government’s statutory advisers, the Climate Change Committee (CCC) has warned that policies to speed up installations of heat pumps need “moved as swiftly as possible towards delivery”.
In its latest progress report, published in June, the CCC stressed that “installations of heat pumps across the UK must rise nine-fold in six years, from 69,000 per year in 2022 to 600,000 in 2028”, warning that “the UK is not currently on track to hit this target”.
The document said that reducing the costs of heat pumps “is a core aim of the Government’s Clean Heat Market Mechanism”, adding that “industry needs encouragement to invest and roll them out at pace”.
The Scottish Government does not have a specific target for heat pump installations but as a proportion of the UK-wide ambition, we could expect around 60,000 a year could be plugged in north of the Border by 2028.
Last year, a record 6,338 heat pumps were installed in Scotland – 37% more than in 2021 and a 113% increase from 2020.
But Scottish ministers have starkly warned that “the current rate of switching to clean heating is far short of what is needed to reach Scotland’s climate change targets”.
Read more: 100k could avoid heat pump installation as heat networks to ramp up
At the current pace, it would take several hundred years to reach net zero. Scotland has pledged to reach net zero by 2045, give years ahead of the UK-wide target of 2050.
Amid speculation the CHMM is set to be axed, the Scottish Government has now formally called on Tory ministers to keep the policy on track.
The power to regulate suppliers and policies rests with the UK Government – which also has the ability to untie gas and electricity prices, another crucial step to ramp up heat pump installations.
A Scottish Government source has warned that “the repeated roll back on net zero action” by the UK Government “creates an environment in which consumers get mixed messages and investors lack the certainty they need”.
In a letter to Lord Callanan, seen by the Herald on Sunday, Mr Harvie, the Scottish Government's Zero Carbon Buildings Minister, has pointed to “speculation that the scheme may be scrapped or seriously diluted”, warning he is “disappointed” the policy could not materialise as planned.
Mr Harvie added: “The CHMM can potentially work alongside and complement the Scottish Government’s existing and future frameworks to incentivise growth of clean heating systems.
“It has real potential to shape the growing market for clean heating systems by encouraging existing boiler manufacturers to sell an increasing proportion of heat pumps.
“I am therefore concerned that the mechanism may be scrapped or seriously diluted and note that doing so is likely to have a detrimental effect on the delivery of Scottish Government plans, as well as our contribution toward UK-wide targets.”
The Greens co-leader added that “aside from specific impacts” cancelling the policy will have, “it also sends a message to consumers and supply chain which is unhelpful and which affects all parts of the UK”.
He said: “As we have discussed previously, clean heat straddles devolved and reserved competencies and it is imperative that we work together on the endeavour to remove emissions from our homes and buildings.
“In that spirit of shared interest and collaboration, I urge you to ensure that decisions taken by the UK Government, specifically those which affect devolved governments, should continue to be made in collaboration through transparent communications.
“I expect that this would be the case with decisions made regarding the implementation of the Clean Heat Market Mechanism, particularly given its ability to impact positively or negatively on the ability to deliver the UK targets on heat in buildings and Scotland’s share of these targets.”
Read more: UK told to 'supercharge heat pumps' as Patrick Harvie launches vision
Mr Harvie has called on Lord Callanan to give him “an update on the progress of the market mechanism and confirmation that it is still the intention of the UK Government to bring these regulations into force from April of this year”.
Dr Jan Rosenow, principal and director of European Programmes at independent green transition organisation, the Regulatory Assistance Project (RAP), has warned that a U-turn on the CHMM would be a disaster for the UK’s heat transition.
He said: “The CHMM is one of the cornerstones of UK policy to decarbonise heating and meet the carbon targets for buildings.
“About one-third of the 600,000 heat pumps per year target by 2028 is supposed to be delivered by the CHMM.
“Scrapping it leaves a gaping hole in the UK’s clean heat policy portfolio. It would also send a very negative signal to investors and companies that have geared up to deliver the millions of heat pump installations required to meet that target.”
A UK Department for Energy Security and Net Zero spokesperson, said: “No decision has yet been made and we remain committed to our ambition of installing 600,000 heat pumps a year by 2028.
“We want to do this in a way that does not burden consumers.”
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