Those involved in the heating industry on the Isle of Man may have recently received notice of a levy or price increase on fossil fuel boiler sales from UK manufacturers.
Following consultation, on 1 January 2024, the UK Government introduced the Clean Heat Market Mechanism (CHMM), obligating manufacturers selling fossil fuel boilers into the UK market to install a proportion of heat pumps based off their fossil fuel boiler sales. Boilers provably exported from the UK market (which would include boilers to the Isle of Man) are not included in how the manufacturers’ clean heat targets under the CHMM are calculated.[1]
The Clean Heat Market Mechanism (CHMM) is a UK Government policy that aims to improve energy efficiency in the home to meet carbon emission reduction targets. The focus of the policy is to increase the installation of ground and air source heat pumps as an alternative to gas and oil heating systems.
‘Introducing the CHMM as planned in 2024 was important for providing market actors with the necessary certainty and confidence to invest in scaling up the UK heat pump market at the pace needed to improve national energy security, contribute to decarbonisation objectives and keep pace with developments in other countries.’ - Gemserv
The introduction of the CHMM has led to some manufacturers adjusting boiler prices, but companies’ decisions with regards to product prices are entirely their own. Some firms are referring to their price adjustments as a ‘tax’ or as a ‘charge’, this is not something which the UK Government has required, nor is there a requirement within the Clean Heat Market Mechanism policy for manufacturers to adjust prices. [2]
As exported boilers (including those exported to the Isle of Man) are not counted within the UK CHMM targets, an agreement on whether to draw a distinction in the approach to pricing is up to the manufacturer and the Isle of Man business.
The Isle of Man Government is aiming to publish a Low Carbon Heat Strategy in 2024, which will detail targets, technology options, policy levers, support schemes and timeframes for phase out dates for fossil fuel heating in the Island’s building stock.
Information on the current regulations for heating in new buildings can be found at www.netzero.im/heatingsystems
[1] https://www.gov.uk/government/consultations/clean-heat-market-mechanism
[2] Department for Energy Security and Net Zero