Are Heat Pumps Cheaper to Run Than Gas Boilers?

A survey of 1,000 heat pump owners has sparked fresh discussion about whether heat pumps really cost less to run than gas boilers. Surprisingly, despite claims about the savings they can offer, the results commissioned by the Green Britain Foundation show that many households are actually paying more than expected. This naturally raises questions for both businesses and homeowners who are thinking about making the switch.

What did the survey find?

The survey carried out by the Green Britain Foundation found that around two-thirds of respondents, roughly 60 per cent or more, said their heat pumps cost more to run than their old gas boiler systems. Around 15 per cent said their bills had gone down, while the rest reported little change or said they were not sure.

In reality, this seems to contradict surveys previously carried out by the government, which showed high levels of satisfaction among heat pump users. Officials have often pointed to research suggesting that most homeowners see lower energy bills after installation.

Understanding Electricity Prices and Heat Pump Efficiency

When you look at the data alongside people’s real life experiences, it does paint a mixed picture. However, much of this comes down to how energy is priced in the UK. Heat pumps are actually very efficient and, on average, they can produce three to four times more energy than they use. The challenge is pricing, as electricity costs more per unit than gas. For many users, that difference can cancel out the potential benefits of running a heat pump.

We would highly advise businesses to compare gas prices per kWh with commercial electricity rates before investing or to get in touch with us. At the moment, the gap between gas and electricity prices means that even very efficient heat pumps can struggle to deliver the savings people expect, especially in older buildings with poor insulation.

This suggests that the type of property may be the biggest factor when it comes to heat pumps. Modern, well-insulated buildings are more likely to see real savings. Older properties, on the other hand, can struggle to retain heat, which means they may not see these benefits. 

What this means for your business
Building insulation   A well insulated property is more likely to run a heat pump at a lower cost than your current boiler system. If improvements are needed, it may be worth carrying these out before installation.  
Electricity tariffs   Heat pumps work really well with time-of-use tariffs, so choosing the right electricity tariff matters. When comparing business gas and electricity prices, the right setup could make a big difference.  
Realistic expectations   When looking at efficiency figures and potential savings, try to get an independent review that compares the heat pump’s performance with your actual energy use. This will give you a clearer idea of the benefits for your business and roughly how much it would cost to run.  
Available funding   Support may be available to help with the cost of upgrading to a heat pump. You may be able to access funding through the £7,500 Boiler Upgrade Scheme grant and the new Warm Home Plan funding.  

Start with the basics

While the debate around heat pumps continues, many businesses are currently paying too much for their commercial gas and electricity. Before investing in new technology, it is worth checking whether you are on the cheapest business gas and the best business electricity rates available. More often than not, significant savings can be made simply by reviewing your current contracts. For example, take a look at our case studies.

Moving forward with heat pumps?

The government’s recent budget plans to cut electricity costs show a growing recognition that the price gap between gas and electricity needs to be addressed. As the grid becomes greener, electricity prices may begin to fall and move closer to gas prices, which would allow heat pumps to make more financial sense over time.

However, for now it is important to understand that heat pumps can save money only in the right conditions. Installing one without proper planning can easily lead to disappointment.

Can Purely Energy Help?

As a trusted UK energy broker, we’re here to help you make the right choice. If you need help with your businessgasorelectricity, get in touch with us! 

If you would like a free quote, please fill in the box below, or to find the best rates please click here.

For more information. Contact us on 0161 521 3400 or email us atinfo@purelyenergy.co.uk 

Written By Faith Labong at Purely Energy