Heat pump prices: what’s the cost of an air source or ground source heat pump?

11 October 2021 | Aimee Tweedale

With the UK government discussing the future of gas boilers, it’s time for many of us to start looking for alternatives. 

When it comes to eco-friendly home heating, heat pumps are the future. They’re efficient, renewable, safe, and they’re bound to be a key part of our path to a net zero world

The only catch? Right now, upgrading to an air source or ground source heat pump is pricier than choosing another same-old boiler. But there's some good news: the UK government recently announced an initiative to give grants to homeowners to install heat pumps from 2022.

So: how much does a heat pump cost here in the UK? Can it save you money on your energy bills? And how can you get your hands on an air source heat pump grant? Here’s everything you need to know. 

How much does an air source heat pump cost?

Heat pump costs depend on lots of different factors. Just like with any other heating system, if you’ve got a bigger 3-4 bedroom house, for example, you can expect to pay more. If you choose a lower quality system or fewer fancy controls and add-ons, you could pay a bit less.

The first step in your air source heat pump pricing journey should be to get some quotes. You can do this by contacting MCS-registered installers and inviting them to survey your home. They can tell you how much it’s likely to cost to fit a heat pump that will keep your whole house toasty and warm.

A new air source heat pump can cost between £2,000-£9,0001, but typically, you can expect to pay £3,000-£4,000 for an average-sized home. That figure doesn’t include the price of installation, replacing your radiators, and other costs.

Read more about how air source heat pumps work

Children playing in front of a radiator

Air source heat pump running costs

How much does an air source heat pump cost to run, and can it save you money? The answer depends on:

  • How big your home is
  • How well-insulated your home is
  • What type of heating system you’re replacing
  • How warm you’d like it to be
  • Your electricity tariff
  • The temperature outside 
  • Whether you’re receiving the Renewable Heat Incentive (scroll down to learn more about this!)

In general, air source heat pumps are very efficient. They have what’s called a Coefficient of Performance, or CoP, of between 2.5-3.52. This means that for each kW of electricity used, 2.5-3.5 kW of heat is generated.

In other words, that’s an efficiency rating of 250%-350%. For comparison, most new, energy-efficient gas boilers have an efficiency rating of around 90%. 

But this doesn’t necessarily mean your heating bills will be lower than they would be with a gas boiler, especially if you’re replacing a brand new model. If you’re replacing an oil or LPG boiler, conventional electric heating, or an old gas boiler, you might save some cash.

Switching to a time of use tariff can help you save money when running your air source heat pump. Even better: if you pair it with your own electricity generation system, such as solar panels, you’ll be saving even more. (Plus, you could apply for the Smart Export Guarantee, too!)

How much does a ground source heat pump cost?

While air source heat pumps take their heat from the air, ground source heat pumps – of course – take theirs from the ground. 

The installation process includes placing pipes underground, usually in your back garden, to absorb the warmth. This means they’re quite big and complex, which can make them a bit pricier than air source heat pumps. 

So: how much is the pump itself? Home Building estimates that an 8 kW GSHP that could heat a 4-bedroom house would be likely to cost £6,000-£7,000, not including installation3. There’s a big variation in cost in the market, though. It’ll depend on the quality and power of the heat pump you choose.

Learn more about how ground source heat pumps work

Ground source heat pump running costs

Ground source heat pumps are even more efficient than air source heat pumps. They generally have a CoP of 3-44 (or an efficiency rating of 300-400%).

But, just like air source heat pumps, their running costs will depend on all the factors listed above. If you’re replacing a very inefficient system you might save money. If you’re replacing a brand new boiler, you probably won’t.

Here are some estimates from the Energy Saving Trust. They worked out what you could save on your energy bills each year with a GSHP, depending on what type of heating system you switched from. 

These numbers are based on a well-insulated 4-bed detached house, with bigger-than-average radiators.

Original heating systemMoney saved on energy bills by switching to a GSHP (£/year)
Old (G-rated) gas boiler£330
New (A-rated) gas boiler-£210
Old electric storage heater system£1050
New electric storage heater system£550
Old (G-rated) oil boiler£440
New (A-rated) oil boiler-£215
Old (G-rated) LPG boiler£1330
New (G-rated) LPG boiler£380

How much does it cost to install a heat pump?

Installing a heat pump in your home is a bit more complicated than fitting a new boiler. For one thing, there are far fewer trained heat pump installers available in the UK than boiler engineers5. This means you’re paying for more specialist skills. 

So how much will a new heat pump cost in total, once you factor in installation, parts, and everything else? The Energy Saving Trust estimates that getting an air source heat pump, including installation, comes to around £7,000-£13,0006

Ground source heat pumps are usually more expensive to install. This is because the process involves digging underground to lay down new pipes. The Renewable Energy Hub estimates that a new ground source heat pump with installation costs could come to a total of £11,000-£15,0007.

The Energy Saving Trust puts their estimate higher, at £14,000-£19,0008.

There’s no getting around it: ground source heat pumps are a big investment. But they’re also often more energy-efficient, which means the outlay could be worth it eventually, thanks to savings on your heating bills. (The exact payback period is tricky to predict, as it depends on how well-insulated your home is, whether you get the Renewable Heat Incentive, and other factors.)

Now for some good news: as heat pumps become more common, more and more engineers will be trained in how to install them, making it less expensive. As the market grows, prices should fall. So, if you’re put off by costs right now, just watch this space.

Underfloor heating installation

Can I get a grant for installing a heat pump?

Got one eye on a new heat pump, and another on your bank account? Help is available!

The Renewable Heat Incentive

The government’s Renewable Heat Incentive (RHI) pays out to householders who opt for clean, green heating tech (including some heat pumps). 

This scheme gives you quarterly payments, rewarding you for each kWh of heat you produce. And these payments last for up to 7 years!

Applications for the RHI are open until 31 March 2022. 

Find out more about the RHI, who is eligible, and how to apply

The Boiler Upgrade Scheme

In April 2022, the Renewable Heat Incentive will be replaced by the Boiler Upgrade Scheme. 

Rather than quarterly payments, this new scheme will give homeowners a one-off grant towards the cost of installing a heat pump. 

You could get £5,000 towards the cost of getting an air source heat pump, or £6,000 if your property needs a ground source heat pump.

Should I get a heat pump now with the RHI, or wait for the Boiler Upgrade Scheme?

Whether you could get more money from the Renewable Heat Incentive or the Boiler Upgrade Scheme depends on several different factors. 

The RHI pays out money for each kWh of renewable heat that your system produces. So, if you have a big property and are planning to install a large heat pump, you could make more from the Renewable Heat Incentive than from the Boiler Upgrade Scheme. 

But remember: this money would be spread out in payments over several years. The Boiler Upgrade Scheme, however, pays out one lump sum to help with the fairly high upfront cost of getting a heat pump. You’ll have to decide which is right for you.

Before making a decision, your best bet is to have installers survey your property and tell you their estimates of what you could make from the RHI. Then, you’ll need to look at these quotes along with your own finances to make the right call for you.

Are heat pumps worth the cost?

So, are air source heat pumps worth the money? We think so.

Sadly, right now, not everyone can afford them. But we hope this will change in the near future. In the meantime, here are a few reasons why we believe heat pumps are so worthwhile.

Benefits of air source and ground source heat pumps

  • You can claim the Renewable Heat Incentive, to help with the running cost of your heat pump.
  • Air source and ground source heat pumps are safe, with no flammable fuel and no risk of carbon monoxide leaks.
  • They have a long lifespan, potentially lasting around 15 years9.
  • Heat pumps could lower your energy bills if you’re replacing an old, inefficient system, or conventional electric heating10.
  • You’ll be helping to fight the climate crisis by decarbonising heat, moving away from our dependence on fossil fuels. This is a really important part of the UK’s journey to net zero – and what could be a better benefit than that?

Don’t forget, the UK government is currently looking at the future of home heating in the UK. Gas boilers might be phased out in the coming years. But heat pumps have a bright future ahead.

If you've got more questions about heat pumps, why not head to the OVO Forum? The Forum is where our green community comes together to share their firsthand experiences of green living, and to help each other out. There are tonnes of discussions about every aspect of heat pumps, so why not get involved and join the conversation? 

How we’re taking the carbon out of home heating

Here at OVO, we love heat pumps so much that last year we started running our Zero Carbon Heating Trial. 

This involved installing low-carbon heating tech in the homes of hundreds of our members. We fitted heat pumps, hot water storage, and even some extra draught-proofing and insulation. And we can’t wait to share our findings with you!

Find out more about the Zero Carbon Heating Trial

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