The Clean Heat Market Mechanism Regulations 2025 (2025 No. 81)

These Regulations are made under Chapter 1 of Part 4 of the Energy Act 2023 (c. 52) and establish a low-carbon heat scheme known as the Clean Heat Market Mechanism. The scheme is divided into four “scheme years”. Participants in the scheme (identified in regulation 9) are those undertakings, or groups of undertakings, which are the supplier (as defined in regulation 2(1)) of a number of fossil fuel boilers above the relevant threshold which are sold during a scheme year. Scheme participants have a low-carbon heat target (regulation 12) for each scheme year. Participants must meet their low-carbon heat target by acquiring and surrendering to the scheme administrator (the Environment Agency) a number of certificates corresponding to the number of units in their target (regulation 25). Installations must be in accordance with regulation 5, which includes a requirement for information about them to be recorded on the register of a certification scheme approved by the Secretary of State under regulation 6. An undertaking which is not a scheme participant may also acquire certificates and is referred to as a certificate holder. Scheme participants and certificate holders may transfer certificates in accordance with regulation 24 and carry them over for use in subsequent scheme years, subject to limits (regulation 26). Part 5 includes provisions concerning information. Part 7 includes powers to enable the scheme administrator to monitor compliance with the Regulations. Part 8 includes a range of civil penalties and Part 9 includes two criminal offences relating to the provision of false or misleading information and obstructing a power of entry. Part 10 contains provision about appeals from decisions made by the scheme administrator to the First-tier Tribunal.