Are heat pumps worth it? Initial outlay vs savings

We weigh up the pros and cons of installing one at home.

If youre in the market for a new boiler, you may be thinking about swapping to a heat pump. Theyre todays low carbon alternative to gas boilers that use electricity and can be used to heat your home and provide you with hot water.

Although the technology has been around for years, you may still be reluctant to make the change, and be wondering if they are worth the hassle and disruption. We’ve spoken to the experts to share the pros and cons to help you decide.

Heat pump placed against an outside wallCredit: Shutterstock/Studio Harmony

How does a heat pump work?

In simple terms, heat pumps transfer heat from one place to another by extracting heat from the air, ground or water.

The pros

Heat pumps: the positives

From helping the environment to potentially saving you money, installing a heat pump can have more than one benefit. We take a look at why you should consider one. 


Heat pumps are energy efficient

With 17% of UK carbon emissions currently coming from heating our homes, the introduction of heat pumps is a way of reducing emissions. The Energy Saving Trust explains: At the moment, most UK homes use fossil fuel boilers for their heating and hot water. In contrast, heat pumps are an extremely low carbon heating option because they use electricity to produce heat in a highly efficient way.”   

In simple terms, because the amount of heat that heat pumps produce is more than the amount of electricity they use, they consume far less energy than gas boilers. In fact, a spokesperson at Octopus Energy says:They use four times less energy than even the most efficient boilers to generate the same amount of heat.stating customers can reduce their carbon footprint by 73%. 

This claim is slightly higher than the figure stated by Stephen Bielby, operations manager at the Ground Source Heat Pump Association, who says: A heat pump is much more energy efficient than a gas boiler, typically 300% versus 92%. On this basis the heat pump will reduce CO2 emissions by 68% against natural gas. 

David Hilton, heating experts at Heat and Energy, explains that it can be complex to compare carbon emissions:“Heat pumps use electricity, which means that their CO2 emissions change seasonally depending on the electricity mix in the grid. The carbon intensity of gas will increase as it gets harder to find, but if synthesis gas or hydrogen is added to the mix then the carbon reduces.”. (If you’re signed up to a green energy supplier, you will still be getting the same electricity from the national grid as everyone else, but over time you’re helping to increase the proportion of renewables in the national grid.) 

The Energy Saving Trust notes that the amount of carbon emissions you will save will depend on the type of system you are replacing, but in all cases, replacing an existing fossil fuel heating system with a heat pump will save carbon emissions.

Heat pumps are also greener in terms of the energy used to fuel them. Martyn Bridges, director of technical services at Worcester Bosch, says: Over the past 10 to 20 years, the UK has decarbonised electricity production significantly, mostly by reducing the use of coal-fired power stations and developing offshore wind and solar PV capabilities. Therefore, the energy supplying heat pumps makes them greener than gas or oil-fired boilers.”  

Longer shelf life

Although there is an initial investment in a heat pump,says Wilkins, in the long term it will benefit the homeowner as they typically last a lot longer than a typical regular domestic boiler.

Where boilers are expected to last around 10-12 years, Wilkins says you can expect a heat pump to have an average lifespan of 20-25 years. The technology behind heat pumps is robust and simple, making for a low maintenance system thats durable. 

However, David Hilton, heating expert at Heat and Energy, explains that heat pumps will still need maintenance and an annual service, adding that the heating distribution system (radiators) is the same for both technologies and will require some maintenance as well”.

An air-source heat pump will still require an annual inspection to make sure the system is clean and working efficiently,agrees the Energy Savings Trust. Its also important to periodically check that the system is still properly dosed with antifreeze [refrigerant].”  If you have any concerns, contact your installer. 

Do you really save money with a heat pump?

Current energy costs may reduce the difference

But what about the day-to-day running costs? When it comes to comparing heat pumps, Bielby says: Ground source heat pumps tend to be more efficient than air source, and therefore cost less to run, because the source temperature of the ground is usually higher than the source temperature in the air in the depths of winter. 

However, he adds: Under the current Ofgem domestic price cap, most heat pump systems will cost about the same to run as a gas boiler, provided they are well specified and installed.

Why is there not a larger margin of difference? Under the current Ofgem price caps, electricity is still more expensive than gas.

Gas is around a third of the cost of electricity, so you need to have an efficiency of 300% to break even,says Hilton. But, as gas becomes harder to find and more expensive to produce, the ratio will inevitably narrow – especially when we use less gas to produce electricity.

The Energy Saving Trust says that although heat pumps are more efficient than gas boilers, their running costs might not always be lower. Today, savings are around £8 a year when replacing a new (A-rated) gas boiler with a heat pump that achieves an average of 298% efficiency.

This figure is based on potential savings of installing a standard air-source heat pump in an average size, three-bedroom semi-detached home, with radiator upgrades as required. The fuel prices are as of July 2023.

You don’t have to replace your gas boiler just yet

Gas boilers are being phased out

Gas boiler set against coloured wallCredit: Shutterstock/esoxx

Beilby tell us that the Government has an aspiration to phase out gas boilers around 2035 by banning their replacement. 

The move is in line with the Governments target to phase out the use of all fossil-fuelled heating appliances by this date, with the aim to reach the net zero’ target by 2050.

However, you dont need to panic. Although the Governments plan is to eliminate the use of gas boilers, Bielby adds:No one will be required to take out a boiler before it reaches the end of its useable life.

This gives us some reassurance that we dont have to make the swap to an alternative heating system while our current boiler is still ticking along nicely. It also gives us time to research and consider alternative heating solutions before we need to make the change.  


Heat pumps work in almost all homes

Is my home suitable for a heat pump?

Most homes are suitable for a heat pump,explains Octopus Energy.As a general rule, if your house is below 200 sq m, was built after the 1930s and is well insulated, it should be a good fit.

The Energy Savings Trust says theres been some concern over whether heat pumps are suitable for older homes, although they say this isnt the case: While they certainly have design challenges, many period property owners are successfully heating their home and hot water with a heat pump, even where they havent been able to increase insulation. 

The cons

Heat pumps: the downsides

Despite cost savings and carbon reduction, installing a heat pump may prove problematic if you live in an apartment, have less outdoor space or need planning permission. A heat pump is certainly not a one-size-fitsall product, and it will need a heating engineer and installer to design a system that is right for your home to ensure you gain the correct heat output.  

We look at some of the negatives to give you a balanced view.

The initial cost is pricey

A heat pump will set you back at least £7,000 but you can claim a grant for £5,000

Heat pump fitted on a front drivewayCredit: Shutterstock/klikkipetra

The amount you pay will depend on the size of the heat pump, the type of heat pump you choose (ground or air source), your property and the changes that need to be made to your heating system, such as upgrading your radiators. 

As a result, costs can range dramatically and the upfront cost of installing a heat pump can be a barrier, says the Energy Saving Trust, with an air source heat pump typically ranging from £7,000 to £13,000.

Ground source heat pumps are pricier. According to Greenmatch, you can expect to pay anything in the region of £17,000-£45,000.

Bridges tells us that despite the high upfront cost, which is around four times that of a natural gas boiler [for air source heat pumps], there is however a £5,000 grant available in the form of the Government’s Boiler Upgrade Scheme 

But while this goes part of the way to covering the cost, Bielby says the price of transitioning to a heat pump is still too high for most people: For this reason, the Government, the heat pump industry and the financial sector are all working together on a range of funding packages, from green mortgages to heat-as-a-service models, to make the transition affordable.

Hilton agrees that the funding schemes are beneficial, but says: We need to learn to fit them more efficiently and bring costs down through volume. If you look at the feed-in tariff for solar panels (PV), the costs only really dropped when the incentives went. And who pays for the incentives and vouchers? The money needs to be paid back somehow and it seems that the energy costs have taken the lion’s share of that. 

Heat pumps need space inside and out

You’ll need more room than a standard combi boiler

The space requirements for an air source heat pump are unfortunately not viable for all homeowners. Bridges says: There are around 17 million properties in the UK with a combination boiler installed, which dont need to have any hot water cylinder. Therefore, space will be needed indoors for a cylinder to be sited. Similarly, space will be needed outside to site the air source pump unit.

If you do have outside space, Octopus Energy says youll need an area similar in size to what youd need for a moped approximately 1m x 1m x 2m (3.28ft x 3.28ft x 6.56ft). While inside, a hot water tank will take the same space as a modern fridge freezer. 

If outside space isnt available to locate the heat pump, Bielby suggests a ground source heat pump may be a possible option: Individual ground source heat pumps take up much the same internal space as a boiler,he says, and outside, the vertical boreholes can be drilled in very small footprints.However, the ability to drill boreholes can be limited by how easy it is to gain drilling rig access. 

Hilton says there are also other elements to consider: Boreholes cost a lot more than horizontal collectors and there is a lot of spoil to take away. The drill rigs and spoil containers take up a lot of space, too.

It may be worth speaking to your neighbours if you are considering switching to a heat pump, as, says Bielby: Individual ground source heat pumps can also be connected to a common shared ground array in the street or in an amenity area.”

But this can add complexity, says Hilton. You need to check who actually owns the system, who is responsible for maintenance and repairs, and also who pays if it fails. Does it need additional metering for pro-rata shares of costs and does your mortgage provider actually allow you to have a shared heating system? 

Planning permission may be necessary

In some instances, a heat pump will fall outside of a ‘permitted development’

Permitted development permission is usually granted for [air source] heat pumps, provided they are below a certain size and noise level,explains Bridges. Its something your installer should be able to advise during a site survey, but its also worth checking with your council if in doubt.

Air source and ground source heat pumps are usually classed as permitted development, so you dont need to apply for planning permission. However, if you live in a listed building or a conservation area, do check with your local council.

Octopus Energy explains scenarios where permitted development is not allowed. The location of your heat pump might be within 1m of the boundary of your property, or your home is located within a World Heritage Site, conservation area, or is a listed building.” 

So if your requirements are outside of permitted development, you will need to obtain planning permission from your local planning authority and permission from the Distribution Network Operator (DNO) to connect a heat pump to your electricity supply.

Heat pumps are often unsuitable for flats

Fitting a heat pump in a flat that’s not ground floor can be difficult

Installing a heat pump can be tricky if you live in a flat, as you have no outside space to site the outside air source unit, explains Bridges. With tower blocks and high-rise apartments, this is obviously almost impossible to do,he adds.

Again, this is also a problem for ground source heat pumps, as youd need access to a garden.

However, Bridges explains there is a halfway house. There are compact heat pumps, which essentially comprise a boiler and a heat pump in the same unit that are wall mounted and dont require outside space. For the majority of the time, the heating system would be served by the heat pump element, and in the colder weather, the boiler would be there to assist.

While fitting heat pumps in flats can be challenging, the Energy Saving Trust confirms there are solutions: In 2022, Maryhill Housing Association in Glasgow, Scotland fitted 11 ‘mini multi’ housing blocks with heat pumps, providing heating and hot water to approximately 20 households.

Bielby says: Blocks of flats can be decarbonised using heat pumps, potentially by district heating, which circulates around the block and has a centralised plant room on the roof or in the basement.This centralised plant can be either an air source or ground source heat pump

As an alternative, a common ground array could be installed around the block,he says, with each flat having its own small ground source heat pump.

But Hilton warns opting for such a system is huge money and very disruptive”. 

However, Bielby adds: The challenge with flats is more to do with ownership than technology. If the block is owned by a single private landlord or housing association, installing a new heating system can be imposed. But if the flats are individually owned, then getting an agreement between leasehold owners can be more difficult. 

Are heat pumps worth it?

They help with decarbonising our homes, but may still prove cost prohibitive

If the aim is to decarbonise a home or commercial building, heat pump technology is probably the best readily available solution,says Bielby. However, the transition to this technology is costly and does not currently result in lower heating costs because of the Governments policy on the relative pricing of gas and electricity.

But as new policy brings down the price of electricity, as new funding models are introduced, and as the UK moves towards reducing its reliance on fossil fuels, heat pumps will start to become the heat technologies of choice.

In agreement with Bielby, the Energy Saving Trust says that more needs to be done to help people access grants and low-cost finance to address the upfront costs of switching to heat pumps: Until both the costs of installing and running a heat pump are consistently competitive with, or better than, a gas boiler, higher upfront costs and affordability will remain significant barriers for many households.”  

Camilla Sharman

Written by Camilla Sharman she/her


With her 30 years of experience, Camilla Sharman has covered a wide range of sectors within the business and consumer industries both as a feature, content, and freelance writer.  As a business journalist, Camilla has researched articles for many different sectors from the jewellery industry to finance and tech, charities, and the arts. Whatever she’s covered, she enjoys delving deep and learning the ins and out of different topics, then conveying her research within engaging content that informs the reader.