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Can my landlord ask for carpet replacement or can it be carpet repair?

Hi everyone. I have got a few questions about carpet damage and would like to see if anyone can provide me with some advice.

I have rented a house from a private landlord but accidentaly I have burnt a small patch of carpet with a hair dryer in one of the bedrooms (The burn looks like a hollow oval shape, the estimated length and width of it are 20cm and 5cm respectively). My LL has suggested three options.

1. Try to get it out with a diluted bleach solution.
2. Try to steam clean it (which will cost about £35).
3. To replace the carpet (which will cost about £220 according to my LL). He has completely ruled out repairing the carpet with a spare patch. He also mentioned to me that the carpet was brand new when I moved in in July 2012.

Please don't get me wrong, I am happy to pay for the cost of the damage but I would like to go for the most cost-effective way as I am only a university student. Which option should I go for in this case? Do I need to pay for all the cost for the repair if the LL ends up going for option 3?

Many thanks

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