Making the switch from gas boiler to air source heat pump

30 Sep 2023
6 min read
Air source heat pump external view

Grants of £7,500 are available for people wanting to replace their oil and gas boilers with heating systems that don’t rely on fossil fuels.

Homeowners in England and Wales can now apply to the Government’s Boiler Upgrade Scheme provides grants for low carbon heating systems such as heat pumps.  

You can get:

  • £7,500 off the cost and installation of an air source heat pump or ground source heat pump 
  • £5,000 off the cost and installation of a biomass boiler 

The grants bring the cost of installing a heat pump close to the cost of installing a traditional gas boiler, while improving the energy efficiency of homes, reducing energy bills and cutting carbon emissions. 

Emissions from heating (and cooling) UK homes account for around 15 per cent of the country’s total greenhouse gas emissions so choosing a low carbon heating option is an important consideration for anyone looking to replace their old gas boiler. The scheme is backdated to April 1 2022 so includes clean heating systems installed after that date. 

How do heat pumps work?

Air source heat pumps don’t generate heat. Instead, they move existing heat energy from outside your home. They are more efficient than conventional heating systems as they deliver more heat than they consume. Typically, one unit of electricity generates three units of heat. 

Heat pumps can run with your existing radiators and pipework but it’s not ideal as they operate at lower temperatures than gas boilers which means they require a larger surface area to radiate heat from. This means they work well with larger radiators and underfloor heating. You can install a heat pump without replacing the existing heating infrastructure but you will probably want to think about replacing it at some point in the near future. 

The heat pump can also heat your water – in fact, most ASHPs in the UK do this (known as air-to-water) so they provide hot water and central heating. If you opt for this, you will probably need to change your hot water tank to a heat pump compatible one, that will be bigger than standard. 

What will it cost?

It depends on the size of your home. Your installer will assess your home and recommend the system that will work best but expect to pay between £8,000 to £10,000, which includes the pump and installation cost. You can reduce this substantially with the Government grant, but consider the additional costs that you may need to pay for things like underfloor heating or a new hot water cylinder. 

A new gas boiler will set you back around £2,500. While on the face of it, this makes heat pumps seem more expensive, the cheaper day to day running costs of a heat pump make it an attractive option. 

Several firms are competing to drive down the cost of a heat pump. For instance, Octopus Energy has launched a ‘Cosy Octopus’ heat pump which they say can be fitted for as little as £500, or even for free, as long as the homeowner does not need any upgrade work and is eligible for the Government grant. 

It’s important to look at the lifetime costs of the different options. Research carried out in 2022 by the Regulatory Assistance Project found that the lifetime costs of a heat pump were pretty much the same as a gas boiler but this is likely to change in favour of heat pumps as the cost of the technology goes down and energy prices remain high. 

However, suppliers are competing to bring running costs down and Ovo has announced a new heat pump tariff called Heat Pump Plus that will cut energy prices by 50 per cent for customers with an Ovo heat pump. 

Heat pumps also have a longer life span than gas boilers – 20-25 years compared with 10-15 for a conventional system. 

But insulate too

As heat pumps operate at lower temperatures, the purpose is to maintain a more consistent ambient temperature so having a good level of insulation will help to keep the heat in. Your installer will advise you on whether you need to make any insulation upgrades. The good news is that the Committee for Climate Change says that 40 per cent of all homes in the UK are suited to a heat pump without any insulation upgrades as they would have been built since the 1970s when building regulations were introduced. 

Ensuring you have space outside for the heat pump unit is another consideration and is something your installer will advise you on. Most houses with even a small amount of outdoor space can accommodate a heat pump. 

The information provided was correct at the time of publication.  Some incentives and grants may no longer be available. 

Martin’s story

Heat pump installation

Martin Stanley lives in a modern, timber-framed mews house in Wells, Somerset. He installed an air source heat pump in May 2022. His gas boiler was coming up to 10 years old so he knew that it would need to be replaced in the next year or so and this seemed like a good moment to install an AHSP as energy prices continue to rise.

Martin chose a reversible Panasonic pump system, which means it cools the house in the summer as well as heating it in the winter. Timber framed houses tend to get very warm in the summer so Martin was keen to have this cooling function, particularly with the prospect of warmer summers in years to come. The Government’s grant scheme does not however cover reversible systems; it only covers ‘heating only’ systems.

Martin’s ASHP cost around £12,000 without a grant which included the cost of installation.

Martin said: “I wanted a system that was more efficient than a gas boiler and with lower carbon emissions.

Heat pump installation

“It is a substantial capital investment but it should result in lower running costs. I’m taking the long-term view and would expect that, over a 10 to 15 year period, it might save me money.”

As will be the case for many homeowners, Martin had a retrofit installation and made a decision to run the cables and pipes on the outside rather than inside as he didn’t want to damage some built-in furniture.

“This is one of the complications of a retrofit installation. It’s probably better to do this sort of work as part of a major house refurbishment or, if you are buying a new home and want to install a heat pump, look carefully at the practical details,” said Martin.

The installation was carried out by Swift Mechanical, based in Clevedon, and it took one week to complete.

“Choosing a system and an installer was a fairly lengthy process – probably about 12 months in total. It involved three house visits to assess my energy usage and ensure the system fitted my needs exactly.

“There was a bit of mess as you might expect, as they had to drill some holes for the trunking, but they cleared up afterwards so there was no major disruption.

Heat pump installation

“Both internal and external units are very quiet. They make a low-level continuous hum, a bit like a dishwasher.

“I’m really pleased with the heat pump and it’s great to know that I have an efficient, low emissions system in place.”

The final word

With energy prices continuing to rise, choosing a heating option which protects you from fossil fuel price fluctuations is a smart choice for customers who can afford the greater upfront cost. The new Government grant makes a tangible difference and it’s a great way for homeowners to play their part in the essential move away from fossil fuel heating systems.


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