How to Navigate the Clean Heat Market and Come Out On Top

From Mandates to Market Maturity: How to Lead in the UK’s Scaling Heat Transition

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January marked a structural shift in the UK’s heating transition.

The Government confirmed its £15 billion Warm Homes Plan, combining grant funding, low-cost loans, heat network support and innovation finance under a long-term framework. The Boiler Upgrade Scheme is now funded through to 2030, maintaining the £7,500 heat pump grant and removing the short-term policy uncertainty that has previously constrained investment decisions.

Alongside this, the Carbon Trust estimates that scaling air-source heat pumps could unlock £110 billion in cumulative system savings and generate £5.7 billion in gross value added by 2050. Clean heat is increasingly positioned not simply as a decarbonisation measure, but as economic infrastructure.

In a funded, regulated and scaling market, communication visibility and credibility determine who scales with it.

The Market Is Expanding Steadily and Across Channels

Recent data shows 61,142 MCS-certified heat pumps installed in 2025, a 5.3% year-on-year increase. Installations supported by the Boiler Upgrade Scheme reached 31,206, up 38% on 2024, while BUS applications rose 36%. 

Social Housing Decarbonisation Fund installations are running 270% higher year-to-date than the previous year and 29% of new homes in England and Wales now use heat pumps as their primary heating system

This is measured expansion across retrofit, social housing and new build. It reflects a sector moving beyond early adoption into structured uptake.

Electricity generation is also becoming cleaner. Zero-carbon generation reached 61% in January 2026, a marked rise on the previous year. Electrification is strengthening alongside deployment.

The growth is steady, institutional and increasingly coordinated - we are very much entering the ‘Decade of Delivery’ for decarbonised heat. 

Mandates Are Now Embedded in the System

Beyond funding, structural mandates are tightening across the UK.

The Future Homes Standard will reshape new build expectations going forwards. Scotland’s New Build Heat Standard is already in force. Heat network zoning is progressing in major cities, guiding infrastructure investment at local level. The Clean Heat Market Mechanism is increasing manufacturer obligations to scale low-carbon heating supply. 

Carbon budgets and statutory net zero targets continue to anchor long-term direction and clean heat is becoming embedded in regulatory architecture.

For developers, manufacturers, local authorities and investors, this changes the legacy view of heating - as the assumption of electrified heat as baseline infrastructure becomes the norm. 

This shift is already visible in major urban heating projects. A government-backed scheme is progressing to use large-scale water-source heat pumps in the Thames to heat some of London’s most recognisable buildings, including the Southbank Centre, the National Theatre, King’s College London and the BFI. The model draws steady, low-grade heat from the river and distributes it through a shared network - with potential to extend across large parts of the capital over time.

Water-source systems offer higher efficiency than air-source alternatives in dense urban environments, and heat networks enable district-scale decarbonisation rather than building-by-building retrofits. The Government has committed more than £1 billion to expand UK heat networks, and London alone is targeting 460,000 connected homes by 2030.

Projects of this scale reinforce a broader point: clean heat is becoming city infrastructure. And infrastructure deployment brings scrutiny, stakeholder complexity and reputational stakes. Clear communication about clean heat’s carbon and economic gains, becomes essential. 

Regulation Has Strengthened the Foundations

Governance has historically been a vulnerability, particularly for heat networks.

From late January 2026, heat networks in Great Britain fell under Ofgem regulation. Around half a million households connected to approximately 14,000 networks will now benefit from formal oversight, including clearer terms and conditions, annual billing based on actual consumption, alignment with national back-billing protections, and structured debt and vulnerability safeguards.

This brings heat networks into line with mainstream gas and electricity regulation - reducing policy risk for investors, operators and local authorities and introducing greater support and transparency for consumers.

The Economic Frame Now Carries Weight

Policy support and deployment growth sit within a sensitive economic backdrop.

The electricity-to-gas price ratio remains elevated, shaping perceptions of operating cost. Construction and manufacturing confidence is improving gradually but remains cautious. Household budgets are still under pressure.

In this environment, economic framing carries influence. Bill stability, long-term system savings and domestic supply chain growth resonate widely. The Warm Homes Plan reflects this by addressing upfront capital barriers while maintaining strategic decarbonisation momentum.

Clean heat is both a carbon and an economic strategy. 

In a market shaped by procurement frameworks, capital scrutiny and regulatory oversight, messaging carries structural weight. Research from Cambridge University shows that UK MPs consistently underestimate public support for green policies, including measures to make homes more energy efficient. In reality, 76% of the public support government action on home energy efficiency - significantly higher than policymakers assume.

This perception gap matters. When decision-makers believe support is weaker than it is, ambition softens and markets hesitate. Organisations that articulate both economic value and carbon impact clearly help close that gap. In doing so, they align more effectively with procurement teams, investors and policymakers - as well as consumers - whose priorities are often broader and more pragmatic than political narratives suggest.

Scaling Markets Reward Clear Voices

As funding stabilises, mandates tighten and regulation strengthens, the competitive environment changes.

More capital enters the space. Procurement frameworks formalise. Investors scrutinise delivery models. Local authorities demand clearer accountability. Technical competence becomes a baseline expectation.

Differentiation shifts to clarity of proposition, consistency of message and the ability to translate complexity into confidence.

Organisations that can communicate economic value, regulatory strength and operational reliability of their clean heat technology will build market leadership.

Navigating the Market From Here

For organisations across the heating value chain - manufacturers, drilling specialists, network developers, consultants and system integrators - the strategic environment is clearer than it has been in years as long-term policy stability enables confident capital planning and mandates anchor direction. 

Navigating the clean heat market successfully now requires more than a business’ technical excellence. For organisations operating across decarbonised heating, success in this next phase depends on aligning product or delivery capability with a mature communication strategy. 

That’s where we come in.

Start a conversation about how your organisation leads - not just participates - in the UK’s heat transition. 

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