The scheme fines UK boiler manufacturers if they do not install a Whitehall set target number of heat pumps into homes. These fines, estimated over the two years 2024 and 2025 to cost the consumer £682 million have now been reduced to an estimated £28 million.

Responding to the news that fines associated with the CHMM are to be massively scaled back, EUA’s chief executive Mike Foster said: “We have consistently opposed the scheme because of the impact it would have on consumers replacing their boilers. We haven’t been the most popular kids on the block for speaking out, but we have helped save three million households around £650 million.

“The new Minister, Miatta Fahnbulleh, has spent time understanding the implications of the scheme she inherited from the previous government. She has displayed an intellectual rigor to this that her predecessor could not.

“She has engaged constructively with industry and British manufacturers, who have warmly welcomed this new approach. By working in partnership, we have an outcome which no longer unfairly penalises business and consumers. That is a big win for households across the country.

“The challenge the government faces is not the lack of supply of heat pumps, you can buy one today if you want, it is the lack of consumer demand. As officials have acknowledged, they cost considerably more to buy than a gas boiler; they cost more to run than a gas boiler and they are more disruptive to fit in the home compared to simply replacing a boiler. These things need addressing if heat pumps are to become more universal.

“We look forward to our continued partnership, working on solutions to decarbonise homes that is affordable for consumers, that can be delivered by British business, taking into account whole energy system thinking and importantly, utilising the world-class energy infrastructure we have built up over the decades.”