In late 2026 a heat pump and a gas boiler cost roughly the same to run — the result turns on the heat pump's real efficiency. At the Ofgem price cap for 1 October–31 December 2026 (electricity 26.32p/kWh with no VAT, gas 7.97p/kWh, GB average), heating a typical home that uses 9,500 kWh of gas a year costs about £760 on gas, against about £810 for a heat pump at the median efficiency measured in the government's Electrification of Heat trial (2.78) and about £640 for a well-designed low-temperature system (3.5). Switching fully also ends the gas standing charge — about £110 a year. Against oil and LPG the heat pump is cheaper at every efficiency in our comparison. An air source heat pump costs a median £12,908 installed under the Boiler Upgrade Scheme (DESNZ, April–June 2026), and the scheme takes £7,500 off — £9,000 for homes with no mains gas replacing oil or LPG until 31 March 2027.
The big question: Heat pump or gas boiler in 2026?
With energy prices remaining high and the UK government pushing towards net zero, the choice between a heat pump and a gas boiler has never been more consequential for homeowners. Whether your current boiler is failing or you're planning ahead, this guide gives you the real numbers.
The short answer: for most well-insulated UK homes in 2026, a heat pump will save you money over its lifetime — especially with the £7,500 Boiler Upgrade Scheme (BUS) grant. But the full picture depends on your home's insulation, your radiator setup, and your willingness to invest upfront.
Bottom line: At the October–December 2026 price cap, gas heat costs about 8.9p per kWh of heat (7.97p at 90% boiler efficiency). A heat pump delivers heat at about 9.5p at the trial median efficiency of 2.78, 8.6p at 3.05 and 7.5p at 3.5. So the design — and in particular the flow temperature — decides whether you save, and it's the grant, dropping the gas standing charge and a heat-pump or time-of-use tariff that make the case, not a big day-one saving.
Running cost comparison: 2026 energy prices
The comparison below uses Ofgem's typical medium gas use of 9,500 kWh a year (the value it adopted from 1 July 2026), delivered by a 90%-efficient boiler — about 8,550 kWh of useful heat. The heat pump rows supply the same heat at three efficiencies: the median (2.78) and upper quartile (3.05) measured across 428 homes in the government's Electrification of Heat trial, and 3.5, the kind of figure a system designed to run at 45°C or below aims for.
| Heating | Energy bought a year | Unit rate (Oct–Dec 2026) | Annual running cost |
|---|---|---|---|
| Gas boiler (90%) | 9,500 kWh gas | 7.97p/kWh | £760 |
| Heat pump, 2.78 (trial median) | 3,076 kWh electricity | 26.32p/kWh | £810 |
| Heat pump, 3.05 (trial upper quartile) | 2,803 kWh electricity | 26.32p/kWh | £740 |
| Heat pump, 3.5 (low-temperature design) | 2,443 kWh electricity | 26.32p/kWh | £640 |
Unit rates: Ofgem price cap, 1 October–31 December 2026, GB average, direct debit (Ofgem, 26 August 2026). Electricity carries 0% VAT from 1 October 2026 to 31 March 2027 (HMRC); gas includes 5% VAT. Typical use: Ofgem TDCV decision, 27 May 2026. Efficiency: Electrification of Heat project summary, Energy Systems Catapult for DESNZ, December 2024. Standing charges excluded: if you remove the gas meter you also stop paying the gas standing charge of 29.68p a day (about £110 a year). Servicing excluded.
On the standard price cap the two are close: a heat pump at the trial median costs a little more in unit costs than gas, one at the upper quartile a little less, and a well-designed low-temperature system clearly less. Ending the gas standing charge tips the median case to roughly level. A heat-pump or time-of-use electricity tariff can lower the heat pump's cost further; compare tariffs once it is installed. Future prices are uncertain — this comparison uses today's capped rates, not a forecast.
Running costs by region
Price-cap unit rates differ by region, so the same home costs slightly different amounts to heat in different places:
| Region | Electricity / gas unit rate | Gas boiler | Heat pump, 2.78 | Heat pump, 3.5 |
|---|---|---|---|---|
| West Midlands (Birmingham) | 25.60p / 7.90p | £750 | £790 | £630 |
| Yorkshire (Sheffield, Doncaster) | 25.60p / 7.90p | £750 | £790 | £630 |
| South West (Bristol) | 26.58p / 8.12p | £770 | £820 | £650 |
| North East (Newcastle) | 25.46p / 7.92p | £750 | £780 | £620 |
| East Midlands (Nottingham) | 25.36p / 7.82p | £740 | £780 | £620 |
| North West | 26.49p / 7.86p | £750 | £810 | £650 |
| Eastern | 26.61p / 7.91p | £750 | £820 | £650 |
| South Wales | 26.55p / 8.09p | £770 | £820 | £650 |
Same assumptions as above, regional direct-debit rates for 1 October–31 December 2026 from Ofgem. Linked cities have local guides covering housing, planning and installation costs.
Heat pump vs oil and LPG boilers
For homes off the gas grid the comparison is different, because oil and LPG cost more per unit of heat than mains gas. Using an illustrative 15,000 kWh of heat a year — a larger, older rural house — and an 85%-efficient boiler:
| Heating | Fuel bought a year | Price | Annual running cost |
|---|---|---|---|
| Oil boiler (85%) | 17,647 kWh (about 1,715 litres) | 8.75p/kWh | £1,540 |
| LPG boiler (85%) | 17,647 kWh | 9.50p/kWh | £1,680 |
| Heat pump, 2.78 (trial median) | 5,396 kWh electricity | 26.32p/kWh | £1,420 |
| Heat pump, 3.5 (low-temperature design) | 4,286 kWh electricity | 26.32p/kWh | £1,130 |
Heating oil: 90.01p a litre, August 2026 (DESNZ Quarterly Energy Prices table 4.1.1), converted at 10.29 kWh per litre (DESNZ greenhouse gas conversion factors 2025). LPG: 9.5p/kWh (Energy Saving Trust, updated 22 September 2026). Electricity: GB average price cap, October–December 2026. Standing charges and servicing excluded.
Against oil and LPG a heat pump is cheaper to run at every efficiency in the table, and the Boiler Upgrade Scheme pays £9,000 rather than £7,500 when a heat pump replaces oil or LPG heating in a home with no mains gas connection, for applications up to 31 March 2027 (how the uplift works). Local guides: Cornwall, Somerset, Fenland & Peterborough, Northumberland, Carmarthenshire & Pembrokeshire.
Installation costs: The upfront investment
This is where the difference is most obvious. Heat pumps cost significantly more to install, but grants dramatically close the gap:
| Installation Factor | Air Source Heat Pump | Gas Boiler Replacement |
|---|---|---|
| Equipment + installation | £12,908 median (£11,128–£15,627 middle half) | £2,500-£4,500 |
| BUS grant available | -£7,500 | None |
| Your cost after grant | about £5,400 at the median | £2,500-£4,500 |
| Radiator upgrades (if needed) | £1,000-£3,000 | Not usually needed |
| Equipment lifespan | 20-25 years | 12-15 years |
Heat pump cost: median installed cost of an air-to-water heat pump under the Boiler Upgrade Scheme, April–June 2026, before the grant (DESNZ BUS statistics, 27 August 2026). Gas boiler replacement and radiator figures are typical installer ranges, not official statistics.
After the £7,500 BUS grant, the installation cost of an air source heat pump is comparable to a premium gas boiler. And because heat pumps last nearly twice as long, the annualised cost of ownership is often lower.
Don’t compare boiler vs heat pump on headline price alone. The Boiler Upgrade Scheme takes £7,500 off (£9,000 replacing oil or LPG off mains gas) — it is a discount, not a free installation. Fully funded heating is limited to some lower-income households through other schemes.
Get a heat pump quote from one MCS-certified installer →Environmental comparison
If reducing your carbon footprint matters to you, the comparison is clear:
| Environmental Factor | Heat Pump | Gas Boiler |
|---|---|---|
| CO₂ per year (heating) | 0.7 tonnes | 2.5 tonnes |
| Fossil fuel use | None (electric) | Direct gas combustion |
| Improves with grid | Yes — gets greener over time | No — locked to gas |
| Air quality impact | Zero local emissions | NOx and CO₂ from flue |
| Lifetime CO₂ (20 yrs) | ~14 tonnes | ~50 tonnes |
A heat pump produces roughly 70% fewer carbon emissions than a gas boiler. As the UK electricity grid continues to decarbonise (it's already over 50% renewable), heat pumps become even greener over time. A gas boiler's emissions remain constant throughout its life.
Heat pump pros and cons
✓ Heat Pump Advantages
- Lower running costs in well-insulated homes
- £7,500 government grant available (BUS)
- 20-25 year lifespan (vs 12-15 for boilers)
- 70% lower carbon emissions
- Provides cooling in summer
- No gas supply needed
- Less annual maintenance required
- Future-proof as gas is phased out
✗ Heat Pump Drawbacks
- Higher upfront cost (even after grant)
- Needs well-insulated home for best results
- May need larger radiators or underfloor heating
- Outdoor unit takes garden space
- Some noise from outdoor unit
- Lower flow temperature than gas boilers
- Needs qualified MCS-certified installer
- Installation takes 2-3 days (vs 1 for boiler)
Gas boiler pros and cons
✓ Gas Boiler Advantages
- Lower upfront cost (£2,500-£4,500)
- Works with existing radiators and pipework
- Familiar technology — easy to find engineers
- Quick installation (typically 1 day)
- High flow temperature for quick warm-up
- Compact size — fits in a kitchen cupboard
- No external unit required
- Established supply chain and parts
✗ Gas Boiler Drawbacks
- Rising gas prices increase running costs
- Shorter lifespan (12-15 years)
- Annual gas safety check legally required
- Carbon emissions (2.5 tonnes CO₂/year)
- Dependent on volatile gas market
- No government grants for replacement
- Future phase-out expected
- Air quality impact from combustion
Which is better for your home?
The right choice depends on your specific situation. Here's a quick decision guide:
Choose a heat pump if:
- Your home is well-insulated (or you plan to insulate first)
- You have outdoor space for the unit (about 1m × 1m)
- You can use the £7,500 BUS grant (£9,000 replacing oil or LPG off mains gas)
- You plan to stay in your home for 10+ years
- You want to reduce your carbon footprint
- You'd consider underfloor heating or larger radiators
Stick with a gas boiler if:
- Your home has poor insulation and you can't improve it (e.g., listed building)
- You need a quick, low-cost replacement and your boiler has died
- You're planning to move within the next few years
- Your property can't accommodate an outdoor unit
How to get a heat pump with the BUS grant
The Boiler Upgrade Scheme provides a £7,500 voucher towards the cost of an air source or ground source heat pump. Here's how to claim it:
- Check eligibility — you must own the property (landlords included) in England or Wales; since 28 April 2026 a valid EPC is no longer required (GOV.UK; SI 2026/390)
- Get quotes from MCS-certified installers — they handle the grant application for you
- Installer applies for the voucher — Ofgem contacts you to confirm you agree to the application
- Installation completed — typically takes 2-3 days
- Grant paid directly to installer — you only pay the difference
Can you get a free heat pump? Not through the Boiler Upgrade Scheme — it is a discount on the price, and it can't be added on top of other public funding for the same heat pump. Funded heating for lower-income households runs through separate schemes; see heat pump grants. If you're paying your share, get a quote from one MCS-certified installer.
The 20-year picture
Over the roughly 20-year life of a heat pump, the financial case is driven less by day-one running savings — which are close at the current price cap — and more by three things:
- The £7,500 BUS grant, which offsets most of the higher installation cost.
- Avoiding a mid-life boiler replacement — a gas boiler typically needs replacing around year 12–15 (£2,500–£4,500), whereas a heat pump lasts 20–25 years.
- Your system's efficiency and tariff — at the trial-median efficiency running costs are near parity with gas; a well-designed low-temperature system and a heat-pump or time-of-use tariff are where the yearly saving comes from.
Put simply: at the standard price cap the running costs are close, so a heat pump's lifetime advantage comes mainly from the grant, its longer lifespan and a heat-pump tariff — not from a large day-one saving. If gas prices rise faster than electricity (as the government's plan to rebalance energy levies is expected to encourage), the balance tips further towards heat pumps. Over 20 years a heat pump in a typical home also avoids roughly 35 tonnes of CO₂ compared with gas.