In 2026, running costs for a heat pump and a gas boiler are close. At the current Ofgem price cap (1 July–30 September 2026: electricity 26.11p/kWh, gas 7.33p/kWh), a well-installed air source heat pump (seasonal efficiency around SCOP 3.5) costs roughly £900 a year to heat a typical 3-bedroom home, versus about £960 for a gas boiler — so the heat pump is marginally cheaper, but the honest answer genuinely depends on your heat pump's efficiency (SCOP) and your electricity tariff. On a specialist heat-pump tariff, a heat pump typically runs £200–£400 a year cheaper than gas (Energy Saving Trust); in a poorly insulated home or at a low SCOP it can cost the same or more. Installation is higher for heat pumps (£10,000–£15,000 vs £2,500–£4,500), but the £7,500 Boiler Upgrade Scheme grant (Ofgem/DESNZ) cuts the net cost to £2,500–£7,500. Over 20 years the financial case rests mainly on that grant, on avoiding a mid-life gas-boiler replacement and the heat pump's longer lifespan — plus around 70% lower carbon emissions.
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 current price cap (1 July–30 September 2026: electricity 26.11p/kWh, gas 7.33p/kWh), a heat pump at SCOP 3.5 delivers heat at about 7.5p/kWh — slightly below a 92%-efficient gas boiler at about 8.0p/kWh. The gap swings with your heat pump's efficiency and your tariff, so it's the £7,500 BUS grant, the longer lifespan and a specialist heat-pump tariff that drive the lifetime case — not a big day-one saving.
Running cost comparison: 2026 energy prices
Let's look at the actual numbers for a typical 3-bedroom semi-detached house using 12,000 kWh of heat demand per year (the UK average):
| Cost Factor | Air Source Heat Pump | Gas Boiler (A-rated) |
|---|---|---|
| Fuel price (price cap, Jul–Sep 2026) | 26.11p/kWh electricity | 7.33p/kWh gas |
| Efficiency | SCOP 3.5 (350%) | 92% efficient |
| Effective cost of useful heat | ~7.5p/kWh | ~8.0p/kWh |
| Annual heating + hot water (~12,000 kWh) | ~£900 | ~£960 |
| On a specialist heat-pump tariff | ~£550–£700 | Not available |
| Annual service cost | £100–£150 | £80–£120 |
Figures use the Ofgem price cap for 1 July–30 September 2026 (electricity 26.11p/kWh, gas 7.33p/kWh, direct debit) and a typical 12,000 kWh heat demand, with the gas boiler at 92% efficiency and the heat pump at SCOP 3.5. The outcome moves with your heat pump's real SCOP and your electricity tariff. Source: Ofgem; Energy Saving Trust, 2026.
On the standard price cap the running costs are close — a well-installed heat pump is marginally cheaper, and clearly cheaper on a heat-pump tariff. Several trends favour heat pumps going forward:
- Gas prices are expected to rise — the UK's gas supply is increasingly imported and subject to global volatility
- Electricity prices are falling — as more renewable energy comes online, wholesale electricity costs decline
- Carbon taxes on gas — the government is considering rebalancing energy levies to make electricity cheaper relative to gas
- Heat pump efficiency improves — well-maintained systems in insulated homes often achieve COP 4.0+, making them even cheaper
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 | £10,000-£15,000 | £2,500-£4,500 |
| BUS grant available | -£7,500 | None |
| Your cost after grant | £2,500-£7,500 | £2,500-£4,500 |
| Radiator upgrades (if needed) | £1,000-£3,000 | Not usually needed |
| Equipment lifespan | 20-25 years | 12-15 years |
| Cost per year of ownership | £125-£375 | £167-£375 |
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. Some households can get completely free heat pump installations through the ECO4 scheme, while others can use the £7,500 Boiler Upgrade Scheme.
Check which heat pump grant you qualify for →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 access the £7,500 BUS grant or ECO4 funding
- 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 and have a valid EPC (use our eligibility checker)
- Get quotes from MCS-certified installers — they handle the grant application for you
- Installer applies for the voucher — approved within days in most cases
- Installation completed — typically takes 2-3 days
- Grant paid directly to installer — you only pay the difference
Can you get a free heat pump? If you receive qualifying benefits, you may be eligible for a completely free heat pump through the ECO4 scheme, or you can combine ECO4 with BUS. Enter your postcode to check what you qualify for.
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 electricity tariff — on a standard tariff running costs are near parity, but on a specialist heat-pump tariff a heat pump can save £200–£400 a year (Energy Saving Trust), which compounds to several thousand pounds over 20 years.
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.