One of the most common questions we hear from homeowners considering a heat pump is: what will it actually cost to run? The honest answer is that it depends on several factors — but this guide walks through the key figures, how they are calculated, and what you can realistically expect based on publicly available data from the Energy Saving Trust and government sources.
How a Heat Pump Uses Electricity
Unlike a gas boiler, which burns fuel to create heat, a heat pump moves heat from the outside air into your home using a refrigerant cycle — the same principle as a fridge working in reverse. This means it delivers more heat energy than the electrical energy it consumes.
The ratio of heat output to electricity input is called the Coefficient of Performance (COP). A heat pump with a COP of 3.0 produces 3 kilowatt-hours (kWh) of heat for every 1 kWh of electricity consumed. In seasonal terms, this is measured as the Seasonal Coefficient of Performance (SCOP), which accounts for performance variation across the year as outdoor temperatures change.
UK air source heat pumps typically achieve an SCOP of 2.5 to 3.5 in real-world conditions, depending on the system design, the property, and the climate. A well-designed installation in a reasonably insulated home commonly achieves an SCOP of around 3.0, meaning it is three times as efficient as a direct electric heater. According to the Heat Pump Association, independently monitored trials of UK heat pump installations have found median SCOPs of around 2.8 to 3.0.
What Does This Mean for Your Bills?
To estimate annual running costs, you need three things: your property’s annual heat demand (in kWh), the SCOP of the heat pump, and your electricity unit rate.
Using publicly available figures as a worked example (assumptions stated below):
- Property: Three-bedroom semi-detached house, built 1970s, cavity wall insulated, loft insulated — typical annual heat demand approximately 12,000–15,000 kWh (space heating and hot water combined)
- Assumed SCOP: 3.0
- Assumed electricity unit rate: 24–25p/kWh (Ofgem price cap Q2 2025 level — this figure changes quarterly)
Calculation: 13,500 kWh (heat demand) ÷ 3.0 (SCOP) = 4,500 kWh of electricity consumed.
Cost: 4,500 kWh × 25p = approximately £1,125 per year for heating and hot water in this example.
For comparison, the same property heated by gas (at around 6p/kWh gas unit rate, 90% efficient boiler): 13,500 ÷ 0.9 = 15,000 kWh gas consumed × 6p = approximately £900 per year.
At current (2025) energy price levels, a heat pump is often slightly more expensive to run than a modern gas boiler in monetary terms, primarily because electricity costs roughly four times as much per unit as gas. The financial gap narrows or reverses in well-insulated homes with low temperature heating distribution and in properties where the gas boiler would need replacement anyway.
Important disclaimer: These are illustrative estimates based on published data and stated assumptions. Your actual bills will differ depending on your property’s size, insulation level, hot water usage, thermostat settings, and the electricity tariff you are on. A home survey and heat loss calculation will give you a property-specific estimate before you commit.
Factors That Affect Running Costs
Insulation
The biggest single factor. A poorly insulated home loses heat quickly, requiring the heat pump to work harder and longer. Improving loft insulation, cavity wall insulation, and draught-proofing before installing a heat pump will reduce both running costs and the required heat pump capacity. The Energy Saving Trust estimates that improving a gas-heated semi-detached home from a D to a C EPC rating can cut heating bills by £200–£400 per year, and the same principle applies to heat pump-heated homes.
System Design and Radiator Sizing
Heat pumps work best at low flow temperatures (35–45°C) rather than the higher temperatures (65–75°C) typical of older gas boiler systems. To deliver enough heat at these lower temperatures, radiators often need to be larger or more numerous than those in a conventional system. Underfloor heating is naturally suited to low flow temperatures. A heat pump system installed without adequate radiator sizing will have to run at higher flow temperatures, reducing SCOP and increasing running costs.
Hot Water Strategy
Heating domestic hot water to 55°C or above (as required for Legionella prevention) is less efficient for a heat pump than space heating. Systems typically include an immersion heater for periodic legionella prevention cycles. Some systems use an immersion heater for all hot water at certain times, which can add to bills if not managed well. A well-designed system minimises immersion use while meeting hygiene requirements.
Your Electricity Tariff
Smart or time-of-use electricity tariffs — such as Octopus Cosy or Intelligent Octopus — can significantly reduce running costs by allowing the heat pump to charge a hot water cylinder during cheaper overnight or off-peak hours. Some homeowners with solar PV can also offset daytime heat pump use with self-generated electricity, reducing grid consumption.
Comparing Running Costs to Gas
The Renewable Energy Consumer Code (RECC) and the Energy Saving Trust both note that the running cost comparison between heat pumps and gas boilers depends heavily on the electricity-to-gas price ratio. In 2022–2023, when gas prices spiked, heat pumps were clearly cheaper to run. In 2025, with energy prices closer to pre-crisis levels, the comparison is tighter for many homes.
A heat pump is more likely to be cheaper to run than gas in a well-insulated home, in a property with underfloor heating or upgraded radiators, or where a homeowner has access to a favourable time-of-use electricity tariff. In a poorly insulated home with small radiators and standard electricity pricing, running costs may be higher than gas until insulation improvements are made.
What This Means in Practice
A heat pump is a long-term investment in a low-carbon heating system. Installation quality, home insulation, and system design have a larger impact on running costs than the heat pump model itself. Getting a proper heat loss survey before installation — rather than a quote based on floor area alone — is the single most important step to ensuring the system is sized correctly and runs efficiently.
RnR Renewables carries out heat loss surveys as part of our air source heat pump assessment process. Call 07907 001 957 or send an enquiry to find out whether a heat pump is a good fit for your home.
Last updated: June 2026. Energy prices quoted are based on Ofgem price cap data and are subject to quarterly change. Running cost estimates use publicly available figures from the Energy Saving Trust and are illustrative only — they are not a guarantee of savings. Actual costs depend on your property, usage, and energy tariff.