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How We Calculate Costs: Our Methodology

How We Calculate Costs: Our Methodology

By Home Energy Quotes · Updated September 2026

Quick answer: Every modelled cost on Home Energy Quotes starts from a national installed-price baseline for each product, is adjusted by a 12-region labour index (0.92 to 1.20), and is given a typical range of 0.65× to 1.55× the mid-point. Running costs and savings use the October–December 2026 Ofgem price cap (26.32p/kWh electricity, 7.97p/kWh gas) and Ofgem’s typical household use of 2,500 kWh of electricity and 9,500 kWh of gas a year.

This page is the methodology behind our UK Home Energy Cost Index and the savings calculator. It was last reviewed on 29 September 2026, when every saving and payback figure was recalculated for the October–December 2026 cap and insulation was re-priced from the Energy Saving Trust’s installed costs. We publish it in full because a cost estimate you cannot interrogate is just a guess with confidence.

The inputs

The range rule: mid × 0.65 to mid × 1.55

A single average hides more than it reveals, so every cost is published with a typical range: the mid-point multiplied by 0.65 at the low end and 1.55 at the high end. The asymmetry is deliberate — real quotes overshoot the average more often, and by more, than they undershoot it (bigger properties, awkward access, higher-spec kit). A heat pump with a £11,014 mid-point therefore shows as £7,159–£17,072.

The regional index

Multiply the national mid-point by the index to get our regional figure. Rounded to the nearest pound, this is the entire regional calculation, with one exception: insulation in Northern Ireland uses the Energy Saving Trust’s own Northern Ireland prices (loft insulation £1,100, cavity wall insulation £1,000), which differ from Great Britain’s by far more than the index would suggest.

RegionIndexvs UK average
London1.20+20%
South East1.12+12%
East of England1.06+6%
South West1.05+5%
West Midlands0.98−2%
East Midlands0.97−3%
Scotland0.96−4%
Yorkshire & the Humber0.95−5%
North West0.95−5%
Wales0.94−6%
North East0.93−7%
Northern Ireland0.92−8%

Savings and payback

Every saving is a “could save up to” estimate for a typical household at the October–December 2026 cap, recalculated on 28 September 2026. We take the better end of what a typical home can expect and say which case that is. Energy Saving Trust figures are converted back to kWh at the prices it states (6.5p/kWh gas) and re-priced at the cap.

Simple payback is the modelled mid-point cost divided by the modelled annual saving, rounded to the nearest year. It ignores price inflation, financing, maintenance and grant support unless stated. Where a grant applies, as with the £7,500 Boiler Upgrade Scheme, we show payback both ways: on the cap a heat pump pays back in about 40 years without the grant and about 13 years with it.

Limitations — read these before quoting us

If you spot an error or a figure that has drifted from reality, we want to know — the index only earns trust by being checkable. Start comparing costs on the Cost Index, or put your own numbers into the savings calculator.

Download the dataset

The full Cost Index (9 upgrades × 12 UK regions: installed costs July 2026, savings at the October to December 2026 price cap) as CSV: gre-cost-index.csv. Free to reuse with attribution (CC BY 4.0) — please credit Home Energy Quotes and link the methodology. Figures are modelled estimates, not quotes.