Heat Pump Running Costs: What You'll Actually Pay

The £7,500 Boiler Upgrade Scheme grant answers the installation cost question. The next question is the one that matters for the following fifteen years: what does a heat pump cost to run?

The efficiency arithmetic

A modern gas boiler converts about 90% of the energy in gas into heat. An air source heat pump delivers 2.5–5 units of heat per unit of electricity — 250–500% efficient, expressed as a SCOP (seasonal coefficient of performance, the average over the whole year).

Electricity costs roughly four times what gas does per unit (about 24p vs 6p). So the maths is a straight race: if your heat pump runs at a SCOP of 3.5, each unit of heat costs about 6.9p from electricity vs 6.7p from gas — near parity. Above that, the heat pump wins on a standard tariff; below it, the boiler does.

That is why installation quality dominates this conversation. A system designed from a proper room-by-room heat loss survey, running low flow temperatures into correctly sized radiators, achieves the high SCOP the sales brochure promised. A rushed install doesn’t.

Heat pump tariffs change the picture

Several energy suppliers now offer heat-pump-specific tariffs with cheaper electricity rates — some around 15–19p per unit, either all day or across long windows. At 17p and a SCOP of 3.5, a unit of heat costs under 5p — clearly beating gas. Combined with solar panels covering a chunk of daytime consumption, many of our customers’ effective heating costs land well below their old gas bills.

Against oil and LPG it’s not close

Oil and LPG heating typically costs 8–11p per kWh of delivered heat, and both fuels swing with the market. A heat pump on almost any tariff undercuts them — which is exactly why the Boiler Upgrade Scheme pays the enhanced £9,000 grant for oil and LPG heated homes. Rural homes around the Ribble Valley, south Cheshire and the moorland fringes of Lancashire are the biggest winners we install for.

Typical annual figures

For an average three-bed semi needing ~12,000 kWh of heat per year:

• Gas boiler (90%): ~£800–£900/year
• Heat pump, standard tariff (SCOP 3.5): ~£820/year
• Heat pump, heat pump tariff (SCOP 3.5): ~£580–£650/year
• Heat pump + solar + battery: often £400–£550/year
• Oil boiler: ~£1,000–£1,300/year — the heat pump saves from day one

The honest summary

On a standard electricity tariff, a well-installed heat pump roughly matches gas. On the right tariff, it beats gas comfortably. Off the gas grid, it wins by a distance. And every scenario improves further with solar on the roof.

The variable in all of it is the quality of the design — which is why every heat pump quote we issue starts with a heat loss survey, not a postcode estimate.