How much is a heat pump?
Imagine slashing your heating bills while simultaneously reducing your home's carbon emissions. A heat pump seamlessly and efficiently does both. But how much does a heat pump cost?
To answer that, we'll unpack the upfront costs, the grants available in the UK, the running costs compared to traditional heating methods and the installation and maintenance costs of an air source heat pump.
How much does a heat pump cost?
First of all, the average cost of a heat pump depends on the type of heat pump. The cost of an air source heat pump system, like the Aira Heat Pump, can range anywhere between £5,450 and £12,000 in the UK, including the cost of installation and taking into account government grants.
This range is affected by various factors such as:
- The size and power of the unit
- The brand
- The complexity of the installation
- Any additional requirements like larger radiators or integration with an existing hot water system.
While installation costs may be higher than a traditional gas boiler, these costs are mitigated by the significant energy bill savings a heat pump provides over time. There are also numerous heat pump grants in the UK to help homeowners significantly lower their upfront costs.
Comparing how much a heat pump costs
Air source heat pump (Aira Heat Pump) | Ground source heat pump | Gas boiler | |
|---|---|---|---|
| Upfront costs | Between £5,450 and £12,000 (after government grant) | Between £7,500 and £27,500 (after government grant) | Between £2,000 and £6000 |
| Cost of gas for heating | N/A | N/A | About £1,068 per year |
| Cost of electricity for heating | About £840 per year (£684 with Aira Zero tariff) | About £672 per year | N/A |
| Cost of electricity for appliances | About £744 per year (£600 with Aira Zero tariff) | About £744 per year | About £744 per year |
| Maintenance costs | Annual or biennial maintenance visit (£238.80 per year & free for first year with Aira all-inclusive plan) | Annual or biennial maintenance visit (£150 to £300 per visit) | About £468 per year |
| Total costs over 20 years | £37,748 (with Aira Zero) | £48,070 | £49,600 |
* Actual upfront & running costs may vary based on variable factors, e.g. size of home, size of heat pump, future energy consumption, future energy price caps and future tariff rates. Running costs based on January 1st 2025 gas and electricity rates. Learn more about how we calculated all costs at the bottom of this article.
What type of house do you live in?
Calculating your own heat pump running costs
Part of calculating how much a heat pump is is understanding its potential running costs. You can do this by creating your own heat pump cost calculator.
First, find your yearly energy usage (you can usually find this in your energy provider's app or website). Divide this number by the expected coefficient energy performance (e.g. 4.5) and multiply this by the current cost of electricity (e.g. 27p).
A practical example
For a practical example, let's use a well-insulated, four-bedroom detached house, requiring about 20,000 kWh for heating per year. Note that this is a different scenario than our table above.
If we assume the heat pump efficiency, or Coefficient of Performance (COP), is 4.5 and the price of electricity is 27p per kWh, the annual cost to run the pump would be:
Annual heating costs = (20,000 kWh / 4.5 COP) x £0.27 = £1200
These calculations underscore not just the potential energy savings, which can range from £65 to as much as £1,100 per annum according to the Energy Saving Trust, but also how energy prices and home specifics, like loft insulation, household heat demand and energy usage, can cause running costs to vary.
How these costs compare to a traditional gas boiler
Heat pumps boast significantly lower running costs compared to conventional gas boilers. Because they use fossil fuels, a gas boiler's maximum efficiency caps at about 92%, whereas heat pumps can reach more than 400%. This means that for every unit of electricity, a heat pump can provide 4X the amount of heat.
Whilst gas prices are lower than electricity, heat pumps, coupled with the right central heating infrastructure, like underfloor heating or larger radiators, deliver heat more consistently and efficiently than standard boilers. This means they are still cheaper to run than a traditional gas boiler.
Heat pump running costs combined with solar panels
Adding solar panels can significantly reduce a heat pump's running costs. A home equipped with solar PV technology and a heat pump can potentially cut its energy bills by £1732 and increase the value of the property by £5,400. There's also 0% VAT to pay on solar panels until 2028, further reducing the upfront costs.
Heat pump running costs combined with a heat pump tariff
To maximise savings, homeowners can also choose a heat pump tariff designed exclusively for heat pumps, such as Aira Zero.
Powered by Octopus Energy, this heat pump tariff allows Aira to adjust your system to heat your home and hot water when the price of electricity is lower and use stored heat and hot water during peak times when it is more expensive. Reducing your energy costs by up to £525 a year without compromising comfort.
Heat pump installation costs and maintenance costs
While considering how much a heat pump is, it's helpful to understand the installation and maintenance costs involved:
Installation costs: The investment for an air source heat pump system ranges from £5,450 and £12,000 (inclusive of government grants). The type of heat pump, property size, and existing heating infrastructure influence the cost.
Additional costs: If you're upgrading your home's heating system, you may need larger radiators or underfloor heating, potentially adding £1,000 to £15,000 to the initial installation costs.
Maintenance costs: Heat pumps are designed to last longer than boilers and, therefore, require less maintenance. Find out how long heat pumps last. Included in all our Aira Heat Pump installs is the Aira Guarantee, which ensures that any parts and labour required to ensure the function of your product and installation are covered for 15 years.
Heat pump grants in the UK
Heat pump grants in England and Wales
The Boiler Upgrade Scheme (BUS) is an initiative by the UK government to encourage people to replace their existing gas or oil boilers with a greener heating system.
Homeowners switching to an air source heat pump in England or Wales can apply for a grant of up to £7,500. To qualify, you must own the property, have a valid EPC, and ensure the installation is done by an MCS-certified installer.
As part of our hassle-free switch, we'll apply for the BUS grant on your behalf and deduct it from your quote.
Heat pump grants in Scotland
In Scotland, the Home Energy Scotland Grant and Loan provides homeowners a grant of up to £7,500 towards the cost of their heat pump installation. An additional £1,500 is also available for rural properties.
The financial assistance doesn't end there – Scottish homeowners also have access to an interest-free loan of up to £7,500. This is applicable for both retrofits of existing properties and new-build projects.
What is the average payback period for an air source heat pump?
The payback period for an air source heat pump depends on various factors such as the initial installation cost, energy savings, and government incentives. On average, it typically ranges from 7 to 12 years. However, this can vary depending on your specific circumstances.
Are there any financing options available to help pay for the upfront cost of an air source heat pump?
Yes, there are financing options available to help manage the upfront cost of an air source heat pump. This includes heat pump grants and schemes offered by the government and energy providers.
Our all-inclusive switch experience also includes heat pump financing options, so you can spread the cost of your heat pump across affordable monthly payments.
Will the cost of an air source heat pump increase my home's value?
Installing an air source heat pump can potentially increase the value of your home by £8,000. Buyers are becoming more interested in energy-efficient and sustainable features when looking for properties. However, the extent of the increase in value can vary depending on the market and location.
Learn more about heat pumps
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*Ground source heat pump running costs are calculated based on a COP that is 1 point higher (5 COP) than that of an air source heat pump (4 COP). Boiler cover & maintenance costs are based on a yearly average spread over 20 years. Includes annual inspection, servicing, repairs and insurance. Total costs are calculated using the average price of the upfront cost of the heating system (£8,725 for the ASHP, £17,500 for the GSHP and £4,000 for the gas boiler), and the average price of a check-up once every two years for the ground source heat pump (£2,250 over 20 years). Total costs for the air source heat pump include the Aira Zero heat pump tariff and the all-inclusive plan, which features the 15-Year Aira Guarantee and a maintenance visit every two years. The all-inclusive plan is complimentary for the first year and costs £19.90 per month for a total of 15 years (£3,343 over 20 years). Total costs also cover two £150 check-ups after the 15-year period.
