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How much does a heat pump cost?

A heat pump is an expensive initial investment that has low running costs thanks to its high efficiency.

5 min read

Heat pumps are steadily garnering more attention across the UK as a potential way to combat rising energy costs. Despite this, many UK households are wary of what investing in a heat pump might mean for their finances owing to the expensive upfront costs.

This article will cover both air source and heat source pump costs, going over the price of the system itself as well as installation costs. The article will also go over the financial advantages of owning a heat pump, thanks to its low running costs and high efficiency.

Air source heat pumps

Air source heat pump

There are two types of air source heat pumps: air-to-air and air-to-water. Both types produce energy from natural heat in the air; the former transforms this heat into hot air, the latter into hot water.

In all cases, air source heat pumps provide heating for your home. Air-to-water pumps differ only in that they also provide hot water for your taps, radiators, bathtubs and showers.

What is the price of a heat pump?

The price of an air source heat pump and its installation vary depending on:

  • The size of your property
  • The nature of your property
  • The size and nature of the air source heat pump
  • The condition of your current heating system

Air-to-air heat pumps are cheaper, coming in at around £1,500-£3,500, whilst air-to-water pumps can cost anywhere from £8,000 to £18,000. Air-to-water pumps are more expensive as they also provide hot water.

So, on average, an air source heat pump costs £7,000-£13,000.

Air source heat pumps are expensive, so the government is offering grants of up to £5,000 on the installation of your system under the Boiler Upgrade Scheme.

How do I have a heat pump installed?

Before going ahead with any installation, make sure that your installers are MCS-certified. This accreditation is essential, as it guarantees a high quality installation.

MCS stands for the  Microgeneration Certification Scheme and it specialises in high-quality installation of **renewable energy for domestic use__.

Find out more and find accredited installers here.

Installing an air source heat pump is relatively simple, taking around a day to complete.

The heat pump will be installed outside, by the side of your house, unless there is space in your cellar. Before installing, your installers will survey the property to ascertain the ideal placement for your heat pump.

What are the running costs of a heat pump?

An air source heat pump comes with hefty upfront costs, but then becomes much cheaper than a traditional boiler thanks to the low running costs.

First of all, heat pump running costs are low thanks to its very high efficiency. Whereas a traditional boiler has 90% efficiency, meaning that 10% of gas is lost during heat production, heat pumps have a staggering 300% efficiency -- at the very least!

A gas boiler has a running cost of 6p/kWh, whilst the air source heat pump costs 5p/kWh.

Ground source heat pumps

Ground source heat pump

Ground source heat pumps retrieve energy from the ground’s heat. They need only mild temperatures (around 10-12℃ to function). They are thus well suited to the UK’s mild climate, and can generate heat all year long.

What is the price of a ground source heat pump?

Ground source heat pumps vary in large part due to the nature of the system installed.

Prices vary wildly, from £15,000 to £45,000. Let’s take a closer look at what causes these variations.

How do I install a ground source heat pump?

If the system is horizontal, with shallow trenches a couple metres deep, the heat pump will be much cheaper to install. Such a system requires much more space, however, so check that your property is suited to a horizontal system.

A vertical system, on the other hand, is much more expensive but takes up considerably less space. This is because installers will dig deep and narrow trenches to house your system.

With the same size and type of system, a horizontal installation will cost between £13,000 and £35,000; a vertical installation will cost between £30,000 and £45,000.

Because of these high costs, the government is running a Boiler Upgrade Scheme, offering grants of up to £6,000 for ground source heat pump installations.

What are the running costs of a ground source heat pump?

Much like air source heat pumps, ground source heat pumps are very efficient. Whilst gas boiler efficiency stands at 90%, heat pump efficiency is at 300%.

Added to this efficiency, ground source heat pumps are much cheaper to run. Boilers cost 6 p/kWh to run, whereas ground source heat pumps cost almost half -- 3.4 p/kWh.

Extra cost (necessary home improvements to install heat pumps)

Heat pumps are only efficient if installed in energy efficient homes.

Energy efficiency is calculated by EPCs (Energy Performance Certificates), giving buildings a rating from A to G based on a building’s insulation and the energy performance of its appliances.

In order to have a high energy efficiency, you will need to improve insulation through draught-proofing, and modernise your heating system with new radiators and an underfloor heating system.

If you have questions regarding home improvement, don’t hesitate to contact us.

How to calculate savings made with a heat pump?

Before contacting an expert, you can roughly calculate potential savings you will make with a heat pump.

Let’s take average gas use in the UK as an example.

An average household uses 12,000 kWh a year, 11,700 of which is for heating and hot water.

With current prices (gas at £0.103 per kWh and a standing charge of £0.28 every day) an annual gas bill will stand at roughly £1,307.

Boiler efficiency, however, means that not all we consume actually goes into heating. 15% of gas is lost** on average, so about __9,945 kWh is actually used.

Heat pump efficiency, on the other hand, is at 300%. So for 9,945 kWh, only 3,315 kWh needs to be produced.

With the running cost of heat pumps at 34 p/kWh, your yearly bill will stand at £1,127 -- almost £200 of savings.

Bear in mind, however, that these yearly savings may not be enough to pay back your initial investment. A heat pump has an average lifespan of 15 years, meaning that your heat pump would represent £3,000 of potential savings on energy bills.

Since the initial investment is more costly than the savings on energy bills, heat pumps remain an expensive heating system.

To sum it up

It is important not to rush into buying a heat pump, as it is a considerable financial investment. The government, however, can help alleviate this financial burden thanks to the creation of the Boiler Upgrade Scheme.

Heat pumps will always be clearly more efficient than gas and electric boilers, enabling low running costs and reduced yearly bills.

Speak to an expert

Our expert team offer free 30 minute phone consultations to help with your project.

Select a date for a call


Is it expensive to install a heat pump?

Heat pump installations are expensive, varying from £10,000 to £45,000.

Are heat pumps efficient?

Heat pumps are known for their efficiency and are much more efficient than boilers.

Is my property suited to a heat pump?

Your property needs to be well insulated if you want to install a heat pump.

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