If you’re considering making the switch to renewable heating, an important question that might be going through your mind is: what will my air source heat pump running costs actually look like? It’s one of the most important questions UK homeowners put forward when working out whether or not a heat pump investment is the right decision, especially during these hard financial times. The good news is that the answer can be much higher in favour of you making the switch than you might anticipate.Â
While air source heat pumps offer incredible efficiency improvements compared to traditional gas boilers, it’s crucial to understand what the real-world running costs will be to make the right decision about the future of your home’s heating. In this blog, we will break down exactly how much you will pay, what affects your bills, and proven strategies to keep your costs as low as possible.
How Much Does It Really Cost to Run an Air Source Heat Pump in the UK?
The annual running cost of an air source heat pump ranges from £450 to £1,500, depending on home size, the quality of its insulation, and your electricity rates. For a typical 3-bedroom semi-detached home, you can be looking at approximately £938 to £1,065 annually.
These figures are based on current UK electricity prices and assume a well-sized, properly installed system with an average Coefficient of Performance of 3.0 to 3.5. The reason these savings are not higher is because currently, electricity is more expensive per kilowatt hour than gas – about 26p per kWh for electricity versus 6p per kWh for gas on standard tariffs.
With a price disparity, the heat pump remains competitive thanks to its unparalleled efficiency.
Why Heat Pumps Win Despite Higher Electricity Prices
An air-source heat pump is more than 300-400% efficient, which means three to four units of heat are produced for each unit of electricity used by the system. Compare that to a conventional gas boiler, which can manage only about 88 to 94 percent efficiency.
If we assess this efficiency for a 3-bedroom home, which usually requires nearly 9,200 kWh of heat output for heating and hot water purposes per year, you’d need 11,500 kWh of gas, which would cost you around £630–£705 per year. With an air source heat pump, you’d just need 3,286 kWh of electricity, if it’s a lower 3.0 COP, which would cost you £734–£824 per year.
The difference will matter even more if you factor in government funding and support. Specialist heat pump tariffs can slash your electricity rates while the ECO4 scheme allows you to install the whole system at no cost to you! Fill in our simple 1-minute eligibility form and check if you qualify for government funding for a free air source heat pump!Â
Breakdown of Air Source Heat Pump Running Costs
Your actual running costs will depend on a number of factors, covered below, and understanding them will help you predict how much you will save in your specific situation with more accuracy.
1. Coefficient of Performance (COP)Â
The COP is how your heat pump’s efficiency is determined and measured, meaning it shows how many units of heat the system produces for every unit of electricity consumed.
- COP 3.0: Generates 3 kWh of heat for every 1 kWh of electricity used – average UK performance
- COP 4.0: Provides 4 kWh of heat with every 1 kWh of consumed electricity. (premium systems)
A system with COP 3.5 will be around 15% cheaper to run compared to the system having COP 3.0. Making sure you choose a reliable installer can impact your systems efficiency!
ECO Boiler Grants only instals high quality systems with Gas-Safe registered installers, helping bring reliable home heat and comfort to you and your home. Fill in our eligibility form to learn more!
2. Quality of Home Insulation
Overlooking the thermal efficiency of your home can greatly affect the running cost of your heat pump. A poorly insulated property will make your heat pump work harder and longer to maintain comfortable temperatures. Upgrading cavity wall insulation can have a 5-10% reduction in running costs, while adding loft insulation can bring it down a further 8–12%.
Draught-proofing and sealing air leaks: 3-5% reduction. Comprehensive insulation improvements can result in up to 20% reduction in annual running costs.Â
If you’re installing a heat pump, then investing in insulation improvements creates a powerful double-benefit: better comfort and significantly lower bills.
If you are eligible for the ECO4 or GBIS scheme, the upgraded insulation is done for free! Fill in our simple form and find out if you qualify now!
3. System Sizing and Design
An incorrectly sized heat pump leads to efficiency issues, with oversized systems frequently turning on and off (short-cycling), thus wasting energy; while undersized systems operate constantly at full capacity, using much more electricity than needed
Professional sizing ensures optimal performance, reducing wasted energy and lowering your bills. This is why choosing a qualified installer is worth the investment as their expertise directly impacts your long-term costs.
4. Type of Radiator and Flow Temperatures
The operational temperature of your heating system will greatly influence the heat pump’s efficiency. Conventional radiators require 50–65°C flow temperature, with its lower COP resulting in higher running costs. Large modern radiators with a 40–45°C flow temperature have a higher COP and lower running costs. Setting your radiators to 45°C instead of 65°C can provide an improvement of 10-15% in efficiency, directly saving £70-£150 annually.
Underfloor heating needs a much lower 30–35°C flow temperature, offering the highest COP, allowing you to save the most.Â
Under the ECO4 scheme, radiators are upgraded for free if you need them to be, as bigger radiators work better with ASHPs.Â
5. Your Electricity Tariff
This is an important opportunity that would allow smart consumers to make the biggest savings immediately. Standard variable tariffs charge 25–30p per kWh, but heat pump–specific tariffs can reduce this to 12–17p per kWh, which is a saving of up to 40%.
6. Thermostat Settings
How you operate your heat pump dramatically influences costs. Constantly turning the system on and off makes the compressor work much harder when restarting each time, thus consuming a lot more energy.
It would be better to set your thermostat to a comfortable, consistent temperature, usually between 19 and 21°C, and allowing the system to run at a steady level. This may seem counter-intuitive compared with how traditional boilers would have behaved, but it’s how you can utilize your heat pump’s efficiency advantage.
Heat Pumps + Solar Panels = Maximum Savings
Here’s where heat pumps really shine! When paired with solar panels, you become much more independent from the grid, while potentially saving more than £1,500 on your annual energy bills. Savings are even higher if you install solar batteries to store excess generation.Â
Carbon emissions are also reduced by up to 80% compared with gas heating.
A typical 4 kWp system would generate enough electricity to run the heat pump for 25–50% of your annual heating needs.
Your Next Steps: Making the Switch
If you are ready to explore the installation of air source heat pumps, there are a few things you need to be aware of! First, the large amount of funding available for eligible homeowners. The ECO4 allows you to install the system for no cost, while the Boiler Upgrade Scheme offers funding of up to £7,500. For the BUS scheme, you’ll need to be replacing an existing fossil fuel heating system (gas, oil or LPG boiler), and your home is not a listed building or the improvement complies with listed building restrictions. You can fill in our 1-minute eligibility form to see if you qualify for the ECO4, BUS, or Great British Insulation Scheme.Â
Assessing the suitability of your home for the new installation is crucial before beginning any work. Heat pumps work best with good insulation and adequate space available for an outdoor unit. The assessment will help you avoid any future potential problems and ensure that the installation can meet all the required guidelines. The assessment is done for free if you are eligible under a government funded scheme. If you are not eligible, make sure to pick an experienced installer as the quality of the installation will have a direct effect on running costs.Â
The air source heat pumps represent a genuine shift in domestic heating economics. While running costs on standard tariffs remain marginally higher than gas boilers, the introduction of specialist electricity tariffs, government grants, and efficiency improvements have fundamentally changed the financial equation. With the available government grants and a specialist electricity tariff, heat pump running costs become competitive with or cheaper than gas boilers. The smart time of use also allows homeowners to save a lot, largely changing the balance to ASHP favour. Combined with solar panels, annual savings of £1,300-£1,700 are realistic over the 15–20 year lifespan of the system. The technology has proven itself to be dependable and trustworthy in the cold UK climate, with the government being strongly committed to support the adoption by recommending it to homeowners through various channels, the technology is seen as a crucial part of the UK’s energy future. Energy suppliers also offer attractive tariffs to try and win over homeowners who have the system installed, allowing you to easily secure yourself with new options to run your system for less.Â
For homeowners looking to seriously reduce their energy bills while eliminating dependence on fossil fuels, the time to act is now! Ready to see what options are available to you? Complete our eligibility form and find out precisely what government support you’re eligible for. ECO Boiler Grants makes the process simple, transparent, and satisfying, always putting our customer satisfaction over anything else. than ever, do not hesitate and fill in our form now!
At ECO Boiler Grants, we specialise in helping UK homeowners through the process of upgrading to renewable heating. Our team will check your ECO4 and Boiler Upgrade Scheme eligibility, assess the best heating system options for your unique needs, and make sure you receive the maximum government support available. The future of home heating is now more affordable.
