Running Cost Comparison: Heat Pump vs Gas Boiler 2026

The central question for most homeowners is straightforward: which system is cheaper to run day-to-day? The answer in 2026 is nuanced, but the trajectory is clearly in favour of heat pumps — particularly as electricity tariffs become more heat-pump-friendly and gas prices remain unpredictable.

Key Energy Prices Used in This Comparison (April 2026)

• Electricity unit rate: approximately 24p per kWh (Ofgem price cap basis)
• Gas unit rate: approximately 6.4p per kWh (Ofgem price cap basis)
• Typical home annual heat demand: 12,000 kWh

Although electricity is roughly four times more expensive per unit than gas, a modern air source heat pump delivers 3–4 units of heat for every 1 unit of electricity consumed — a ratio known as the Coefficient of Performance (CoP). This is what makes the economics work.

The headline takeaway: a well-installed heat pump in a reasonably insulated home can match or beat a gas boiler on running costs right now — and the gap will widen as the government's smart tariffs and time-of-use electricity pricing roll out further. Homeowners with solar panels or battery storage can push costs even lower.

When a Gas Boiler Still Has the Edge

Honesty matters here. If your home is poorly insulated (EPC rating E or below), a heat pump running at a CoP of 2.0 or less will be more expensive than gas. The fix isn't to avoid heat pumps — it's to improve insulation first, which also increases comfort and reduces overall heat demand. Our running cost calculator factors in your EPC rating to give you an honest projection.

What Does a Heat Pump Cost to Install in the UK?

Before running costs, there's the upfront capital outlay to consider. Here's what UK homeowners are typically paying in 2026:

These costs include the heat pump unit, labour, pipework modifications, a hot water cylinder, thermostat controls, and commissioning. They do not typically include radiator upgrades or additional insulation — though in many well-insulated UK homes, existing radiators are perfectly adequate.

Compare these figures to a new gas boiler, which typically costs £2,500–£4,500 installed. The upfront gap is real — but the BUS grant dramatically closes it, and running cost savings compound over the system's 15–20 year lifespan.

Boiler Upgrade Scheme 2026: Am I Eligible?

The Boiler Upgrade Scheme has been running since 2022 and remains one of the most generous home energy grants available in the UK. Here are the headline eligibility criteria for 2026:

• Your property must be in England or Wales
• You must own the property (including landlords installing for rental properties)
• The property must have a valid EPC (Energy Performance Certificate) with no outstanding recommendations for loft or cavity wall insulation — or those recommendations must have already been acted upon
• The heat pump must be installed by an MCS-certified installer and meet MCS product standards
• You must not have received a previous BUS grant for the same property
• The existing heating system must be fossil-fuel based (gas, oil, LPG, or electric storage heaters)

The good news: the scheme has no upper income limit and no means testing. It's available to homeowners across the income spectrum. The grant is deducted from your installer's quote, so you simply pay the balance — there's no need to claim it back yourself.

Unsure whether you qualify? Our eligibility checker takes less than a minute and will give you a clear steer. Read our full BUS grant guide or jump straight to the checker below.

Best Heat Pump Brands in the UK 2026

Not all heat pumps are created equal. Brand reliability, warranty length, and real-world Seasonal Coefficient of Performance (SCoP) data matter enormously for long-term running costs. Here are the brands consistently rated highest by UK installers and homeowners in 2026: