How Much Does a Heat Pump Cost?

Air Source Heat Pump Costs

The average cost of an air source heat pump installation in the UK is £7,000-£13,000 before grants. With the £7,500 Boiler Upgrade Scheme grant, your out-of-pocket cost reduces to as little as £2,000-£5,500. Prices vary depending on the size of your property, the brand of heat pump, and any additional work required.

A typical 3-bedroom semi-detached house would need an 8-12kW heat pump, costing around £9,000-£11,000 before the grant. Larger detached properties may require a 12-16kW system at £11,000-£14,000. These prices include the heat pump unit, hot water cylinder, installation, MCS certification, and commissioning.

Ground Source Heat Pump Costs

Ground source heat pumps are more expensive to install at £20,000-£35,000 due to the cost of ground works (boreholes or horizontal trenches). However, they also qualify for the £7,500 BUS grant, and their higher efficiency means lower running costs over the system's 25-30 year lifespan.

The higher upfront cost is offset by superior efficiency — ground source systems typically achieve a COP of 4.0-5.0 compared to 3.0-4.0 for air source. Ground temperatures remain stable at 10-12°C year-round, providing more consistent performance than air source units.

Running Costs vs Other Systems

Annual running costs for an air source heat pump are typically £500-£800, compared to £800-£1,200 for gas, £1,200-£1,800 for oil, and £1,500-£2,500 for electric heating. Ground source heat pumps can be even cheaper at £400-£700 per year.

With 0% VAT on heat pump installations and the £7,500 BUS grant, the total cost of ownership over 20 years is typically 20-40% lower than gas heating and 50-70% lower than oil or LPG heating. As electricity prices are expected to fall relative to gas, these savings will increase over time.