With gas bills surging thanks to volatile global fossil fuel markets, research shows electric powered heat pumps could save homes up to £260 on average
The most efficient heat pumps are now cheaper to run than conventional gas boilers, potentially saving the average UK household up to £261 on their annual energy bill, fresh analysis that takes into account the impact of surging global gas prices has calculated.
Energy bills have already soared in recent months due to the global gas supply shortage, and they are set to climb yet further from April by another 84 per cent, taking the average UK household’s annual bills to almost £2,000 a year.
However, gas prices have increased far more than electricity prices, due to volatile global market for fossil gas which provides electricity to gas power plants, as well as feeding into the national gas grid which provides heating to around 85 per cent – 23 million – of the UK’s residential buildings.
As a result, renewable heating technologies such as heat pumps are now “much more competitive”, according to the study. It calculates that electric-powered heat pumps which are designed and installed efficiently may be cheaper to run, saving households up to 27 per cent on their energy bills compared to a conventional gas boiler, accounting for an average saving of up to £261 per year.
The study, published yesterday by the Regulatory Assistance Project NGO, is one of the first to demonstrate it could now be cheaper to heat homes in the UK using heat pumps rather than from the gas grid, which could potentially bolster the case for investing in low carbon heating systems in the UK.
“This analysis shows that if they are designed and installed well, heat pumps can be cheaper than gas boilers, the main home heating technology used in the UK,” the study concludes. “Heating with a gas boiler will cost households £934 per year, up from £579. A very efficient heat pump will only cost £723 per year, up from £536 per year. For an average household, this is a saving of £261 per year.”
Gas prices are expected to remain high for at least the next year or two, putting pressure on the government to provide support to vulnerable households struggling to meet the rising cost of their bills, in addition to more ambitious policy and financial incentives for energy efficiency measures and clean energy to reduce reliance on fossil fuel imports while also driving down domestic greenhouse gas emissions.
Earlier this month the government unveiled a £9.1bn support package that effectively offers billpayers a loan to foot their energy bills this year, which will then be paid back in instalments on their bills later, but even with that support bills will still rise significantly for most households.
It has also remained steadfast in its support for scaling up domestic renewable energy capacity in order to boost energy security, last week announcing plans to hold subsidy contract auctions for fresh clean power capacity every year rather than every two years.
However, the government faces an uphill battle to deliver on its target for 600,000 heat pump installations across the UK each year by 2028, with just a fraction of that number having been installed in homes last year, due in part to a shortage of installers and financial incentives to accelerate the rollout
But the RAP’s research could potentially further bolster the case for households able to invest in fitting an efficient electric-powered heat pump in their home, as it suggest doing so could potentially save them hundreds of pounds a year, while also significantly slashing their emissions.
Study author and director of the RAP Jan Rosenow suggested he had undertaken the study in part to combat “misinformation” around the costs associated with heating homes using heat pumps compared to conventional gas boilers.
The statements reported in the media that heat pumps cost more to run that gas boilers are equally untrue as are statements that heat pumps are always cheaper to run than gas boilers. It all depends on the efficiency of the heating system before and after.
— Jan Rosenow (@janrosenow) February 17, 2022
However, he cautioned that it would be “equally untrue” to suggest that heat pumps were always cheaper to run than gas boilers, just as it would be false to claim gas boilers were always cheaper than heat pumps.
“It all depends on the efficiency of the heating system before and after,” he stressed.