Eco Happy (Solar Expert)

Published March 27, 2024

How much does a heat pump cost? The installation of a heat pump can cost you anywhere between £7,000 and £49,000.

Additionally, the annual running costs range from £685 to £1,550. These prices may seem steep but many benefits come with the installation of heat pumps, as well as potential savings in the long run.

Heat pump instalments may be low in the UK compared to Europe but if recent statistics are anything to go by, there should be a rise in numbers soon. In 2023 alone there was a 25% increase in installations.

If you are flirting with the idea of installing a heat pump but are worried about the costs, or wondering if heat pumps are worth it, Eco Happy is here to walk you through your journey to a greener future.

How Much Does It Cost To Install A Heat Pump?

When working out the costs of heat pump installations, you need to first decide which kind of pump (air source or ground source) is best suited to your home and heat demands. You would then look at the additional costs associated with your specific choice of heat pump, including the labour and additional expenses.

Heat Pump Cost

There are three main types of heat pumps used in the UK: air source, ground source, and hybrid. Each has its benefits and will be more suited to some households than others.

The figures shown below are a general idea of the installation-related costs associated with heat pumps.

Air source heat pumps

An air source heat pump (ASHP) is the most commonly installed type in the UK. There are two kinds of air source pumps: air-to-air, and air-to-water. Including installation and layout design, an air source pump ranges in price from £12,000 to £15,000, with air-to-air being on the more expensive end.

The air source heat pump installation process is fairly simple and requires interior and exterior units to be fitted and connected. Exterior units are fitted to a wall or concrete base and connected to power cables outside the house. The interior unit is connected to heating systems within the house, such as radiators, underfloor heating, and hot water pipes.

Ground source heat pumps

A ground source heat pump (GSHP) requires extensive planning and designing of the layout for pipework and, therefore, costs more than an air source heat pump. A ground source heat pump would work well for households with larger outside areas for the installation.

Ground source heat pumps range between £16,200 and £49,000, which includes digging and installation costs.

One significant benefit of a ground source heat pump is that it extracts solar energy from the ground. However, the installation of a ground source heat pump requires more intricate planning and labour.

During this process, loop fields are dug in preparation for the pipe network. Once the pipes are buried, they are filled with an antifreeze and water solution, which functions as a heat exchanger.

The next step addresses any modifications or replacements needed in your home for the heat pump to work effectively, such as installing underfloor heating or larger radiators. Finally, the ground source heat pump is connected to the pipes and any newly installed heating systems.

Hybrid heat pumps

Hybrid heat pumps can either be air or ground source heat pumps that are used in conjunction with a boiler and are therefore not 100% green. These pumps are best suited to older homes and range in price from £7,000 to £15,000.

Labour Costs

The labour costs of installing a heat pump range from £350 to £1,700.

Workers will typically charge a daily rate, and the complexity of the installation will affect the overall labour cost.  Both ground and air source heat pumps take approximately 1-2 days to install. However, this would depend on the property size and type. Larger areas will likely take longer than two days in the case of a ground source heat pump installation.

Factors Affecting The Cost Of Heat Pump Installation

Many factors affect the cost of installing a heat pump. The process can be broken down into three steps:

  1. Surveying of property, planning, and layout design
  2. Installation of interior and exterior units
  3. Servicing and maintenance

Before you contact a heat pump installer for a property assessment, you need to have an Energy Performance Certificate (EPC), which costs between £60 and £120. EPCs are especially important if you plan on applying for a government grant.

Brand of heat pump

The brand of heat pump you choose will have a direct impact on your overall expenditure. Below is a sample selection of prices from brands that make both ground source and air source heat pump models:

  • Worcester Bosch heat pumps: £8,000 – £15,000
  • Viessmann heat pumps: £9,000 – £14,000
  • Daikin heat pumps: £8,500 – £15,500
  • Vaillant heat pumps: £9,000 – £15,000

The above prices account for the installation as well as the unit; however, additional costs will be incurred for a ground source heat pump installation. Contact Eco Happy for more information on the best heat pump brands available.

Size of home

The size of your home will dictate how many kilowatts (kW) you require to supply a sufficient amount of heat, and thus what size heat pump you need. Larger pumps will obviously cost more.

The insulation of your home will also impact the size of your pump. Poorly-insulated houses will require a higher kW output to meet heat demands.

The average kW requirements for varying homes would look something like this:

  • Two-bedroom house: ASHP 5 kW; GSHP  4 kW
  • Well-insulated four-bedroom house: ASHP 9 kWGSHP 8 kW
  • Poorly-insulated four-bedroom house: ASHP 16 kW; GSHP 15 kW

The size of your home and property will also determine whether an air or ground source heat pump will be more efficient. There is no point in getting an air source heat pump for a 5-bedroom home, as this will only cost more to run.

Type of heat pump system

An air source heat pump is the more cost-effective option and can be installed in smaller dwellings. Those who opt for a ground source heat pump have a further choice of installing either a vertical or horizontal system.

Vertical ground source heat pumps are more labour-intensive and require deeper excavations, making them more expensive (£23,200- £49,000).

The type of ground source heat pump system you choose is usually determined by the exterior property size. However, some may opt for the vertical installation as a personal preference.

Heat Pump Running Costs In The UK

The use of a heat pump in place of a gas boiler will usually reduce your gas bills, depending on the type of pump.

Given that heat pumps are fully electrified, many people may be concerned about their increased electricity usage and what it will cost them. It might be cheaper to run a gas boiler today, but gas prices are likely to increase as the UK rallies towards a more sustainable future.

The average annual cost to run a heat pump is between £685 and £1,550, with hybrid heat pumps being the most expensive to run and GSHPs being more cost-effective.

How the running costs are calculated

To arrive at an estimate of the running cost:

  1. Divide the household heat requirement by the heat pump’s efficiency.
  2. Then multiply it by the current electricity tariff.

Factors affecting the running costs

One of the most important factors to consider when installing a heat pump is the current state of your home’s insulation. Structures with poor insulation will see higher running costs, and vice versa.

If the insulation in your home is completely inadequate, installers may suggest implementing the following:

  • Double glazing windows: Costs between £300 and £500
  • Loft insulation: Traditional quilt insulation costs around £400 and 270 mm; thick insulation costs between £500 and £700
  • Cavity wall insulation: Polyurethane foam costs between £30 and £65 per square metre (sq m), and glass wool costs between £25 and £30 per sq m.

Additional labour costs can begin at £50 an hour, with an average installation taking between one and two hours.

Location and climate

Those living in the warmer parts of the UK (towards the south), will find that the cost to run their heat pumps is less than the annual cost of running a gas boiler. However, the areas more prone to cold weather may have higher running costs.

Efficiency

A heat pump offers a high level of efficiency (300%), but there are models with even higher levels (up to 500%). The more efficient the pump, the higher the cost. However, pumps with higher efficiencies have lower long term running costs.

Heat demands of the household

The heat demands of your home will dictate the size and type of heat pump required to supply your home with sufficient warmth. This is a more technical aspect but it’s a crucial part of the installation process and gives insight into running costs.

A larger system with a higher kilowatt output for a larger home will cost more to run than a system suited for a smaller home.

How to calculate actual heat demand

These calculations are quite technical and can be performed by a heating engineer. To calculate your heating demands, you need to consider the following:

Heat loss is calculated by multiplying the thermal resistance of the material (e.g. the wall, floor, or ceiling) by the area of the surface/material and the difference in temperature inside vs outside.

The heating day degrees is the total number of days per year the temperature falls below a certain threshold (so the number of days per year you’ll need heating).

Once you have these figures, heating demand is calculated using the following equation:

(heat loss) x (heating day degrees) ÷ (efficiency of the heating system) = watts of heating needed

The watts can then be converted into BTU (British Thermal Units, a common unit needed when buying heat pumps) by multiplying it by 3.412142.

Special tariffs for heat pumps

To encourage UK residents to make the switch to heat pumps over gas boilers, special electricity tariffs have been implemented. These offer flexible or lower rates specifically for the running of the heat pumps.

It is worth looking into, as many companies, such as OVO, offer competitively low prices (but only if your installation is done through them).

Government Grants For Heat Pumps In The UK

The UK government’s Boiler Upgrade Scheme came into effect on 1 April 2022. This scheme covers part of the upfront costs for those making the switch from gas boilers to heat pump systems. It currently pays £7,500 towards the installation of ground or air source heat pumps. This grant does not cover hybrid heat pumps.

To be eligible for the Boiler Upgrade Scheme, your house and heat pump must meet certain criteria. For example:

  1. You must own the building or property where the installation is taking place
  2. The pump must meet minimum efficiency levels
  3. The home must have a valid EPC

To begin the process of applying for this grant, first, get an MSC-certified installer to assess your property. The Boiler Upgrade Scheme is done through and paid to MSC-certified companies and installers.

These companies will determine whether or not you qualify for the grant and provide feedback on how to become eligible should your property not meet the standard. The Boiler Upgrade Scheme is only valid until 2028, so be sure not to delay your installation.

FAQs

What are the potential savings relating to heat pumps?

You could potentially save up to £500 a year on your energy bills when you switch from a boiler to a heat pump.

A heat pump can be quite cost-effective despite the high upfront costs. Be sure to apply for the Boiler Upgrade Scheme while it is valid, find a suitable heat pump electricity tariff, and do away with your gas boiler. The running costs have the potential to be lower than that of an oil or gas boiler.

Will a heat pump add value to your property?

Properties with energy-efficient fixtures (such as heat pumps) have a higher selling price. These features can increase your property value by between 1.7% and 3%. Installing a heat pump guarantees a good return on investment.

Do heat pumps make noise?

Heat pumps are not noisy. Newer heat pumps shouldn’t be a problem as far as decibel levels are concerned. A heat pump that is properly fitted and maintained should not exceed a decibel level of 60. This is the same as a boiler and is the equivalent of a low hum, much like a refrigerator. It is more like white noise.

Naturally, the decibel level increases in winter as the heat pump works harder. An air source heat pump tends to be “louder” than ground source heat pumps but not by a noticeable amount. If silence is especially important to you, there are heat pump models with “extra quiet” features, but these may cost more than standard models.

What is the environmental impact of a heat pump?

A heat pump (hybrid excluded) runs exclusively on electricity, and releases fewer harmful emissions into the environment by not burning additional fossil fuels, as gas and oil boilers do. Since electricity is being used, fossil fuels are still being burned but the emissions are lessened.

Even though heat pumps contain refrigerants, they are a low global warming potential refrigerant, meaning their impact on the environment is minimal.

Conclusion

If you are still not convinced that a heat pump is the right investment for you, keep the future in mind. Heat pumps are not only a way forward to sustainable living but may very well become mandatory as a means to reach the UK’s net zero government initiative. It is in your best interest to act now while there are government grants and incentives in place to ensure that your choice is financially viable.

It is a big step and there is a lot of conflicting information regarding heat pumps. Eco Happy has a wealth of sound information to answer any questions or concerns you may have. Feel free to contact us.

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