NICEIC Head of Standards, Dani Putney, shares her thoughts on the major policy changes set to impact the sector in 2025.
Dani Putney | Certification and Accreditation Services Manager
There have been a raft of policy announcements since the current government took office in July. These have ranged from the broad objectives the government has set itself and which were most recently outlined in Keir Starmer’s December ‘Plan for Change’ speech to more concrete regulatory reforms, impacting the electrotechnical sector.
In the Plan for Change speech, Starmer reiterated key manifesto pledges on clean energy and skills and promised to streamline the planning process to enable greater housebuilding and expedite infrastructure projects. The Prime Minister’s milestones, laid out in the speech, are the measures by which he is asking to be judged in the next general election, which is likely to take place in 2029. In the more immediate term, there are regulations coming into effect in the new year, as well as government capital expenditure projects that will directly impact the sector.
In November, the Department for Energy Security and Net Zero (DESNZ), announced changes to its Warm Homes Plan, which aims to provide upgrades to 300,000 homes through clean heating technology and improved insulation. The new measures and additional funding announced are a strong signal of intent that the government is making this a priority area, with potentially significant implications for heating, renewables and electrical installers.
The cornerstone of the government’s plan is improving the energy efficiency of residential properties across the country. Domestic heating is a significant contributor to the UK’s greenhouse gas output, accounting for 14% of total national emissions. In order to meet the UK’s targets for cutting carbon emissions by 45% by 2030, and net zero emissions by 2050, there has to be an accelerating transition away from fossil fuel based heating systems.
Primarily, this will be achieved through upgrading traditional gas boiler heating systems to more energy efficient alternatives such as air source heat pumps. The government announced an additional £30m funding for the Boiler Upgrade Scheme this financial year, as well as an increase in allocated spending for the next financial year, taking the budget to £180m.
The scheme, administered by Ofgem, provides upfront capital grants to support the installation of heat pumps and biomass boilers in homes in England and Wales. Installers, on behalf of householders, can apply for a grant of £7,500 off the cost and installation of an air source heat pump.
In an effort to ensure its target of 600,000 heat pump installations per year by 2028 is met, the government also announced major changes to planning rules. Previously, if a heat pump was within one metre of a neighbouring property, planning permission was required. From 2025, permitted development rights will remove the 1m boundary rule, enabling heat pumps to be installed within 1m of the property boundary and increase the size limit of the heat pump for homes from 0.6m(3) to 1.5m(3).
It is estimated that 34% of those who order a heat pump are discouraged or drop out for reasons associated with planning and this intervention may be crucial in unlocking demand and increasing the number of heat pump installations in the medium term. This presents a clear opportunity for certified installers in 2025 to be right at the heart of the UK’s clean homes transformation.
This is further supported by changes to the regulatory framework that underpins the transition to low carbon heating, the Clean Heat Market Mechanism (CHMM). The CHMM, which comes into effect on 1 April 2025, includes a market standard for heat pumps as a proportion of fossil fuel boiler sales, currently set at 6%. This is designed to provide manufacturers with certainty and the confidence to invest as well as making heat pumps an attractive choice for households.
There have also been commitments impacting the social housing sector, with £1.29 billion committed to the Warm Homes: Social Housing Fund over the next three years. On average, social housing suffers from reduced energy efficiency, compared to the private rented sector, meaning greater emissions and increased costs for residents. The investment aims to enable the upgrading of a significant amount of the social housing stock currently below Energy Performance Certificate (EPC) band C. The Social Housing Fund will support the installation of energy performance measures in social homes in England that improve efficiency and reduce carbon emissions as well as supporting the growth of the retro fit sector.
The policies announced amount to a range of targeted interventions, which have been designed in collaboration with manufacturers and installers, with the potential to drive demand and accelerate adoption of low carbon technologies. 2024 has been a record year for heat pump installations, with average monthly installs up 39% compared to 2023, indicating that consumers will choose new solutions if the incentives are right. With the new investments and policy changes, there is a marked opportunity to build on that momentum and ensure that heat decarbonisation plays will a vital role in meeting net zero ambitions.
NICEIC recently announced that its Heat Pumps Installation and Maintenance training course is now available through the government’s Heat Training Grant.
In the Plan for Change speech, Starmer reiterated key manifesto pledges on clean energy and skills and promised to streamline the planning process to enable greater housebuilding and expedite infrastructure projects. The Prime Minister’s milestones, laid out in the speech, are the measures by which he is asking to be judged in the next general election, which is likely to take place in 2029. In the more immediate term, there are regulations coming into effect in the new year, as well as government capital expenditure projects that will directly impact the sector.
In November, the Department for Energy Security and Net Zero (DESNZ), announced changes to its Warm Homes Plan, which aims to provide upgrades to 300,000 homes through clean heating technology and improved insulation. The new measures and additional funding announced are a strong signal of intent that the government is making this a priority area, with potentially significant implications for heating, renewables and electrical installers.
The cornerstone of the government’s plan is improving the energy efficiency of residential properties across the country. Domestic heating is a significant contributor to the UK’s greenhouse gas output, accounting for 14% of total national emissions. In order to meet the UK’s targets for cutting carbon emissions by 45% by 2030, and net zero emissions by 2050, there has to be an accelerating transition away from fossil fuel based heating systems.
Primarily, this will be achieved through upgrading traditional gas boiler heating systems to more energy efficient alternatives such as air source heat pumps. The government announced an additional £30m funding for the Boiler Upgrade Scheme this financial year, as well as an increase in allocated spending for the next financial year, taking the budget to £180m.
The scheme, administered by Ofgem, provides upfront capital grants to support the installation of heat pumps and biomass boilers in homes in England and Wales. Installers, on behalf of householders, can apply for a grant of £7,500 off the cost and installation of an air source heat pump.
In an effort to ensure its target of 600,000 heat pump installations per year by 2028 is met, the government also announced major changes to planning rules. Previously, if a heat pump was within one metre of a neighbouring property, planning permission was required. From 2025, permitted development rights will remove the 1m boundary rule, enabling heat pumps to be installed within 1m of the property boundary and increase the size limit of the heat pump for homes from 0.6m(3) to 1.5m(3).
It is estimated that 34% of those who order a heat pump are discouraged or drop out for reasons associated with planning and this intervention may be crucial in unlocking demand and increasing the number of heat pump installations in the medium term. This presents a clear opportunity for certified installers in 2025 to be right at the heart of the UK’s clean homes transformation.
This is further supported by changes to the regulatory framework that underpins the transition to low carbon heating, the Clean Heat Market Mechanism (CHMM). The CHMM, which comes into effect on 1 April 2025, includes a market standard for heat pumps as a proportion of fossil fuel boiler sales, currently set at 6%. This is designed to provide manufacturers with certainty and the confidence to invest as well as making heat pumps an attractive choice for households.
There have also been commitments impacting the social housing sector, with £1.29 billion committed to the Warm Homes: Social Housing Fund over the next three years. On average, social housing suffers from reduced energy efficiency, compared to the private rented sector, meaning greater emissions and increased costs for residents. The investment aims to enable the upgrading of a significant amount of the social housing stock currently below Energy Performance Certificate (EPC) band C. The Social Housing Fund will support the installation of energy performance measures in social homes in England that improve efficiency and reduce carbon emissions as well as supporting the growth of the retro fit sector.
The policies announced amount to a range of targeted interventions, which have been designed in collaboration with manufacturers and installers, with the potential to drive demand and accelerate adoption of low carbon technologies. 2024 has been a record year for heat pump installations, with average monthly installs up 39% compared to 2023, indicating that consumers will choose new solutions if the incentives are right. With the new investments and policy changes, there is a marked opportunity to build on that momentum and ensure that heat decarbonisation plays will a vital role in meeting net zero ambitions.
NICEIC recently announced that its Heat Pumps Installation and Maintenance training course is now available through the government’s Heat Training Grant.
