diff --git a/src/vs/workbench/contrib/chat/browser/chatSetup.ts b/src/vs/workbench/contrib/chat/browser/chatSetup.ts
index f42fd26ada5..a325d5526f1 100644
--- a/src/vs/workbench/contrib/chat/browser/chatSetup.ts
+++ b/src/vs/workbench/contrib/chat/browser/chatSetup.ts
@@ -26,7 +26,6 @@ import { IConfigurationService } from '../../../../platform/configuration/common
 import { ContextKeyExpr, IContextKeyService } from '../../../../platform/contextkey/common/contextkey.js';
 import { IContextMenuService } from '../../../../platform/contextview/browser/contextView.js';
 import { IDialogService } from '../../../../platform/dialogs/common/dialogs.js';
-import { IExtensionManagementService } from '../../../../platform/extensionManagement/common/extensionManagement.js';
 import { ExtensionIdentifier } from '../../../../platform/extensions/common/extensions.js';
 import { IInstantiationService } from '../../../../platform/instantiation/common/instantiation.js';
 import { ILogService } from '../../../../platform/log/common/log.js';
@@ -60,7 +59,6 @@ import { IOpenerService } from '../../../../platform/opener/common/opener.js';
 import { URI } from '../../../../base/common/uri.js';
 import { IHostService } from '../../../services/host/browser/host.js';
 import Severity from '../../../../base/common/severity.js';
-import { IRemoteExtensionsScannerService } from '../../../../platform/remote/common/remoteExtensionsScanner.js';
 
 const defaultChat = {
 	extensionId: product.defaultChatAgent?.extensionId ?? '',
@@ -1021,10 +1019,9 @@ class ChatSetupContext extends Disposable {
 		@IStorageService private readonly storageService: IStorageService,
 		@IWorkspaceContextService private readonly workspaceContextService: IWorkspaceContextService,
 		@IExtensionService private readonly extensionService: IExtensionService,
-		@IExtensionManagementService private readonly extensionManagementService: IExtensionManagementService,
 		@IWorkbenchExtensionEnablementService private readonly extensionEnablementService: IWorkbenchExtensionEnablementService,
-		@IRemoteExtensionsScannerService private readonly remoteExtensionsScannerService: IRemoteExtensionsScannerService,
-		@ILogService private readonly logService: ILogService
+		@ILogService private readonly logService: ILogService,
+		@IExtensionsWorkbenchService private readonly extensionsWorkbenchService: IExtensionsWorkbenchService,
 	) {
 		super();
 
@@ -1049,10 +1046,9 @@ class ChatSetupContext extends Disposable {
 			}
 		}));
 
-		await this.remoteExtensionsScannerService.whenExtensionsReady();
-		const extensions = await this.extensionManagementService.getInstalled();
+		const extensions = await this.extensionsWorkbenchService.queryLocal();
 		const defaultChatExtension = extensions.find(value => ExtensionIdentifier.equals(value.identifier.id, defaultChat.extensionId));
-		this.update({ installed: !!defaultChatExtension && this.extensionEnablementService.isEnabled(defaultChatExtension) });
+		this.update({ installed: !!defaultChatExtension?.local && this.extensionEnablementService.isEnabled(defaultChatExtension.local) });
 	}
 
 	update(context: { installed: boolean }): Promise<void>;