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How much does an air source heat pump cost?

Imagine slashing your heating bills while simultaneously reducing your home's carbon emissions. An air source heat pump seamlessly and efficiently does both.

We'll unpack the initial costs, potential grants available in England, Wales and Scotland, the running costs compared to traditional heating methods and the financial side of installation and maintenance of an air source heat pump.

How much will your heat pump cost?
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What is an air source heat pump?

An air source heat pump is a sustainable heating solution that harnesses the heat from the outside air to warm your home. Eco-friendly and more cost-effective in the long run, this system operates by extracting natural heat from the air, which - even at low temperatures - contains thermal energy.

Once collected, the heat pump uses electricity, which can be sourced from renewable supplies, to provide warmth through radiators or underfloor heating systems. Not only do air source heat pumps serve as a green alternative to conventional gas boilers, but they also play a significant role in reducing our reliance on fossil fuels and decreasing our carbon footprint.

What is an air to water heat pump?
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Given their energy-efficient operation and compatibility with other renewable technologies like solar panels, air source heat pumps are becoming an increasingly popular choice for those seeking a more eco-friendly way to generate hot water and heat their homes.

While the upfront costs can be substantial, government grants like the Boiler Upgrade Scheme and the Home Energy Scotland Grant and Loan are available to help offset the initial investment.

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What does an air source heat pump cost?

Investing in an air source heat pump system not only provides environmental benefits but long-term cost savings too.

The average cost of an air source heat pump system, including the cost of installation, can range anywhere between £4,500 and £10,000 in the UK (inclusive of government grants). 

This range is affected by various factors such as the size and power of the unit, the brand of the heat pump, the complexity of the installation process, and any additional requirements like larger radiators or integration with existing hot water systems.

Higher installation costs compared to traditional gas boilers are mitigated by the significant energy bill savings that a heat pump provides over time.

To help lower the upfront costs, homeowners in the UK can take advantage of heat pump grants.

How much will your heat pump cost?

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Air source heat pump grants in the UK

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Air source heat pump grant in England and Wales

The Boiler Upgrade Scheme (BUS) is an initiative by the UK government to encourage people to replace their existing, traditional heating systems 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. With our hassle-free switch, we'll apply for the grant on your behalf and deduct it from your quote.

Eligibility criteria for the BUS grant include owning the property where the heat pump will be installed, having a valid EPC and ensuring the installation is carried out by an MCS-certified installer.

Learn more about the Boiler Upgrade Scheme
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Air source heat pump grant in Scotland

In Scotland, the Home Energy Scotland Grant and Loan provides homeowners a grant of £7,500 towards the cost of a 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 to help with the installation fees if necessary. This is applicable for both retrofits of existing properties and new-build projects.

The combined grant and loan offering in Scotland, which increases if you also install solar panels, significantly reduces the financial burdens of installing a heat pump system.

Learn more about the Home Energy Scotland Grant & Loan
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Calculating your own air source heat pump running costs

Want to create your own heat pump cost calculator?

Find your yearly energy usage within your provider's app or website. Divide this number by the expected coefficient energy performance (4.5) and multiply this by the current cost of electricity (27p).

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A practical example

A practical example would be a well-insulated, four-bedroom detached house, requiring about 20,000 kWh for heating per year. 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.

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How these compare to a traditional gas boiler

When pitched against a conventional gas boiler, air to water heat pumps significantly lower running costs. 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, an efficient 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.

Air source 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 can potentially cut its energy bills by up to 70% and can increase the value of the property by around £5,400. 

Ein schönes dunkles Einfamilienhaus mit Solaranlage auf dem Dach

By harnessing free solar energy during daylight hours to power the heat pump, homeowners can substantially decrease their dependence on the grid and save on electricity bills.

Including solar panels not only doubles down on the household's energy efficiency but also enhances self-sufficiency. There's also 0% VAT to pay on solar panels until 2028, further reducing the upfront costs.

Learn more about solar panels
Solar panels on large roof
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Heat pump running costs combined with a heat pump tariff

Homeowners can also choose a heat pump tariff designed exclusively for heat pumps, such as Ocotpus Cosy, which allows your heat pump to heat and store your hot water during off-peak hours when the price of electricity is lower. 

This can unlock potential savings of up to £330 per year on heating bills.

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Air source heat pump installation costs and maintenance costs

While considering an air source heat pump, it's essential to understand the installation and maintenance costs involved:

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Installation costs

The investment for an air source heat pump system ranges from £4,500 to £10,000 (inclusive of government grants). The type of heat pump, property size, and existing heating infrastructure influence the cost.
Joint being sealed on newly installed, copper radiator pipes

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.
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Running costs

Once installed, air source heat pumps offer lower running costs compared to conventional heating systems. The actual savings vary based on your home's insulation, the efficiency of the system, the type of heat pump and your usage patterns.
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Maintenance costs

Regular maintenance is vital to ensure optimal performance. With the Aira Comfort Guarantee, any parts and labour required to ensure the function of your product and installation are on us for 15 years.

Government support

Homeowners in England and Wales may be eligible for the Boiler Upgrade Scheme, offsetting up to £7,500 of the upfront costs. In Scotland, the Home Energy Scotland Grant and Loan provides individuals up to £15,000 in funding. These grants make the switch to a heat pump more affordable and accessible.

Learn more about heat pumps

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The Aira Heat Pump

Some say intelligent, affordable and carbon emission-free heating sounds too good to be true. We say it sounds like Aira.

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How do heat pumps work?

Heat pumps are a clean alternative to traditional heating systems. Learn more about the different types and how they all work.

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What are air to water heat pumps?

Air to water heat pumps use thermal energy to heat your home and water. But how do they work and how are they installed?

Cost of an air source heat pump FAQs

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.

Yes, there are financing options available to help manage the upfront cost of an air source heat pump. This includes grants and schemes offered by the government and energy providers. With the Aira all-inclusive plan, you have the flexibility to opt for monthly payments.

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.

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