Heat Pump vs Gas Boiler: The Real Running Cost Comparison
🔍 Key Findings
- On a standard electricity tariff, a heat pump can cost around £110 a year more to run than an efficient gas boiler
- Replacing an old, inefficient gas boiler, it could save around £220 a year even on a standard tariff
- On a heat pump tariff with the gas account closed, savings of around £204–£530 a year are estimated
- A heat pump typically costs around £12,000 before the £7,500 grant; a like-for-like combi boiler swap is usually £2,500–£4,000
Running cost figures: Energy Saving Trust, July 2026 fuel prices. Boiler price: Checkatrade guide, March 2026.
There's widespread confusion about whether heat pumps are more expensive to run than gas boilers. This guide uses Energy Saving Trust estimates and the current Ofgem price cap to explain why the answer depends on which tariff you're on and how efficient your current boiler is.
Understanding the Efficiency Gap
The running cost debate centres on two key facts:
- Electricity costs more than three times as much as gas per unit (kWh) under the October–December 2026 price cap: 26.32p against 7.97p
- Heat pumps are more than three times as efficient as a gas or oil boiler, according to the Energy Saving Trust
A heat pump's efficiency is measured by its Seasonal Coefficient of Performance (SCOP). Which? says that in the UK this is generally around 3.0, so for every unit of electricity it uses it delivers about three units of heat. It does this by extracting heat from the outside air and concentrating it through a refrigeration cycle. A gas boiler generates heat by burning gas, and even a modern condensing boiler cannot turn all of that energy into heat.
Why This Matters
If electricity costs three to four times as much as gas but the heat pump is about three times as efficient, the running costs end up in the same range. The tariff you choose, and whether you still pay a gas standing charge, then decide which comes out cheaper.
Annual Running Costs: The Real Numbers
| Heat pump set-up | Replacing an old, inefficient gas boiler | Replacing an efficient gas boiler |
|---|---|---|
| Standard electricity tariff, gas account kept | Saves around £220 | Costs around £110 more |
| Standard tariff, gas account closed (no gas standing charge) | Saves around £330 | Saves around £4 |
| Heat pump tariff, gas account closed | Saves around £530 | Saves around £204 |
*Change in annual bills from replacing a gas boiler with a standard air source heat pump in a three-bedroom semi-detached home, with radiator upgrades as needed. Energy Saving Trust estimates based on fuel prices as of July 2026. Typical figures, last reviewed September 2026. Your result depends on your home, your tariff and how you use your heating.
Why Your Tariff Matters
Your electricity tariff is one of the biggest factors in a heat pump's running cost. The Energy Saving Trust says that on standard tariffs, heat pumps can cost slightly more to run than new gas or oil boilers. A heat pump tariff, and closing your gas account, can change that.
What Are Heat Pump Tariffs?
Some energy suppliers offer tariffs aimed at heat pump owners. They usually offer:
- Cheaper electricity at certain times of day
- Time-of-use pricing that lets you heat your home and hot water when electricity is cheapest
- Conditions to check, such as needing a smart meter
💰 Closing Your Gas Account
If a heat pump replaces your only gas appliance, you can close your gas account and stop paying the gas standing charge.
Choosing a Heat Pump Tariff
- Compare current offers from several suppliers, as rates and conditions change often
- Check the eligibility conditions, such as needing a smart meter
- Look at the peak rate as well as the cheap rate, and whether your heating pattern fits the cheap periods
- Include the standing charge when you compare
Upfront Cost Comparison
New Gas Combi Boiler
Air Source Heat Pump
Looking at the Long-Term Cost
We don't put a 15-year total on this page, because it would depend on energy prices years from now that nobody can forecast. When you compare options, weigh up:
- The installed price after any grant
- Your likely running costs on the tariff you will actually use (see the table above)
- Whether you can close your gas account and stop paying the gas standing charge
- Servicing costs and the conditions of each warranty
💡 The Verdict
On a standard tariff, a heat pump can cost slightly more to run than an efficient gas boiler. The case is strongest when you are replacing an old, inefficient boiler, switch to a heat pump tariff and close your gas account, where Energy Saving Trust estimates savings of around £204–£530 a year. A heat pump also burns no fuel in your home.
Pros & Cons: Heat Pumps
Advantages
- • More than three times as efficient as a gas boiler
- • Can be cheaper to run on a heat pump tariff
- • No fuel burned in your home
- • Some systems can also provide cooling
- • £7,500 Boiler Upgrade Scheme grant in England and Wales
- • Lets you close your gas account if it replaces your only gas appliance
- • The kind of low-carbon heating new homes in England will need from March 2027
Disadvantages
- • Higher upfront cost (before the grant)
- • Works best with good insulation
- • Lower flow temperatures (radiators may need upgrading)
- • External unit needs outside space
- • Usually needs a hot water cylinder, unlike a combi boiler
- • Can cost more to run than an efficient gas boiler on a standard tariff
Is a Heat Pump Right for You?
A heat pump is worth serious consideration if:
- You're replacing an old, inefficient boiler
- Your home is reasonably well insulated, or you can insulate first
- You can switch to a heat pump tariff
- You want to move away from burning fossil fuels at home
- You have outside space for the external unit
- You own the home in England or Wales and qualify for the Boiler Upgrade Scheme
⚠️ When to Stick with Gas (For Now)
A new gas boiler may be more practical if:
- Your current boiler is fairly new and working efficiently
- Your home loses heat quickly and you can't insulate first
- You rent and can't make major alterations
- You need an immediate, lower-cost replacement
The Future of Heating in the UK
Important clarifications about UK heating policy:
- There is currently no ban on replacing a gas boiler in an existing home
- New homes in England will need low-carbon heating, such as a heat pump or heat network, under the Future Homes Standard from 24 March 2027
- Gas boilers will not meet the performance standard for those new homes
- Government policy can change, so check GOV.UK before planning years ahead
The Bottom Line
If you're replacing an old boiler and qualify for the Boiler Upgrade Scheme, price up a heat pump alongside a new gas boiler.
After the £7,500 grant, a typical £12,000 heat pump costs about £4,500, against £2,500–£4,000 for a like-for-like combi swap. On a heat pump tariff with no gas standing charge, savings of around £204–£530 a year are estimated; on a standard tariff it can cost more to run than an efficient gas boiler. These are typical figures, not a promise for your home.
It's crucial to insulate your home first if it's poorly insulated, and to switch to a heat pump tariff after installation to get the most from it.
Typical costs, last reviewed September 2026. Sources: Energy Saving Trust (July 2026 prices), DESNZ Boiler Upgrade Scheme statistics (July 2026), Ofgem price cap (October–December 2026) and Checkatrade new boiler cost guide (March 2026).
UK Energy Partnership is run by Harber Glaves Trading Ltd. We are not a government body and cannot decide who gets funding — check eligibility with the official scheme.
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