An air source heat pump (ASHP) costs £8,000-£14,000 installed and suits the vast majority of UK homes. A ground source heat pump (GSHP) costs £15,000-£35,000 but delivers higher efficiency (COP 4.0-5.0 vs 2.8-3.5). Both qualify for the £7,500 BUS grant. Ofgem data shows 97% of Boiler Upgrade Scheme applications are for air source systems — and for good reason. Unless you have a large garden (200m2+) and want maximum long-term efficiency, an air source heat pump is the right choice for most UK homeowners.
Head-to-Head Comparison Table
| Feature | Air Source (ASHP) | Ground Source (GSHP) |
|---|---|---|
| Installed cost (before grant) | £8,000-£14,000 | £15,000-£35,000 |
| Cost after £7,500 BUS grant | £500-£6,500 | £7,500-£27,500 |
| Efficiency (COP) | 2.8-3.5 | 4.0-5.0 |
| Annual running cost (3-bed) | £800-£1,200 | £500-£900 |
| Installation time | 2-4 days | 1-3 weeks |
| Garden space needed | Minimal — wall-mounted unit | 200m2+ for trenches, or borehole |
| Lifespan | 20-25 years | 25-30+ years |
| Noise level | 40-55 dB at 1 metre | Near silent (indoor unit only) |
| Maintenance | Annual service, £100-£200 | Annual service, £100-£150 |
| BUS grant share | 97% of applications | 3% of applications |
| Planning permission | Usually permitted development | Usually permitted development |
Sources: Energy Saving Trust, Ofgem BUS Statistics, MCS
How Do Air Source Heat Pumps Work?
An ASHP extracts heat from outdoor air — even at temperatures as low as -20C — and transfers it into your home via a refrigerant cycle. The unit sits outside your property, typically mounted on the ground against an external wall. It connects to your existing central heating system (radiators or underfloor heating) and a hot water cylinder.
Installation is straightforward: most systems are fitted in 2-4 days with minimal disruption. No garden digging is required. The outdoor unit is roughly the size of a large suitcase and operates at 40-55dB — comparable to a fridge.
Key advantages:
- Lower upfront cost (£8,000-£14,000 before grant)
- Quick installation with no groundwork
- Works with any UK property that has wall or ground space for the outdoor unit
- Proven technology — over 88,000 BUS-funded installations completed (Ofgem)
How Do Ground Source Heat Pumps Work?
A GSHP extracts heat from the ground via buried pipes (ground loops), which maintain a constant temperature of 10-13C year-round regardless of weather. This stable heat source is why ground source systems achieve higher efficiency ratings.
There are two main installation methods:
- Horizontal trenches — pipes buried 1.5-2 metres deep across a large garden area (200m2+ for a typical 3-bed home)
- Vertical boreholes — pipes drilled 60-200 metres deep, suitable for smaller gardens but more expensive (£5,000-£10,000 for drilling alone)
Installation takes 1-3 weeks due to the civil engineering work involved. The indoor unit is compact and near-silent.
Key advantages:
- Higher efficiency (COP 4.0-5.0) for lower running costs
- Silent operation — no outdoor fan unit
- Longer lifespan (25-30+ years for the ground loop, which can outlast the heat pump itself)
- Unaffected by outdoor air temperature — consistent performance year-round
Which Costs Less to Run?
Ground source heat pumps are 20-30% cheaper to run than air source, but the higher installation cost means payback takes 15-20 years. At current Ofgem rates (electricity 24.67p/kWh, Q2 2026), here is a typical annual running cost comparison for a 3-bedroom home:
| ASHP (COP 3.2) | GSHP (COP 4.5) | |
|---|---|---|
| Electricity used for heating | 4,375 kWh | 3,111 kWh |
| Annual heating cost | £1,080 | £768 |
| Annual saving vs gas boiler | £100-£300 | £400-£600 |
| Hot water cost | £150-£250 | £100-£180 |
| Total annual heating + hot water | £1,080-£1,330 | £768-£948 |
Based on 14,000 kWh annual heating demand. Actual costs depend on property size, insulation and usage patterns.
Over a 20-25 year lifespan, a GSHP typically costs less in total than an ASHP due to lower running costs and longer equipment life (Energy Saving Trust).
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Which Is More Efficient?
Ground source heat pumps consistently outperform air source on efficiency because ground temperatures remain stable at 10-13C, while UK air temperatures range from -5C to 30C. When outdoor air drops below 5C in winter (exactly when you need heating most), ASHP efficiency falls. GSHP efficiency stays constant.
Seasonal efficiency ratings:
- ASHP SCOP: 2.8-3.5 (for every 1kWh of electricity, produces 2.8-3.5kWh of heat)
- GSHP SCOP: 4.0-5.0 (for every 1kWh of electricity, produces 4.0-5.0kWh of heat)
In practice, this means a GSHP uses 25-35% less electricity than an ASHP to heat the same home.
What About the BUS Grant?
Both air source and ground source heat pumps qualify for the £7,500 Boiler Upgrade Scheme grant in England and Wales. The scheme has been extended to 2028 under the Government’s Warm Homes Plan.
From 21 July 2026, homes currently using oil or LPG heating can receive an increased grant of £9,000. This temporary uplift applies to both ASHP and GSHP installations and runs until March 2027 (GOV.UK).
The grant makes a bigger proportional difference for ASHPs: a £12,000 ASHP installation becomes £4,500 out of pocket, while a £25,000 GSHP installation is still £17,500 after the grant.
Which Should You Choose?
For 97% of UK homeowners, an air source heat pump is the better choice. The lower upfront cost, simpler installation and proven technology make it the practical option. Choose a ground source heat pump only if:
- You have a garden of 200m2 or more (or budget for borehole drilling)
- You want the lowest possible running costs over 25+ years
- You prefer silent outdoor operation
- You are building a new home where ground loops can be installed during construction
For more detail on system types and how they work, visit our heat pumps guide.
FAQ
Is a ground source heat pump worth the extra cost?
Over a 20-25 year lifespan, yes — a GSHP typically saves £3,000-£8,000 in running costs compared to an ASHP. However, the higher upfront cost (£15,000-£35,000 vs £8,000-£14,000) means the payback period is 15-20 years. If you plan to stay in your home long-term and have the garden space, it is a sound investment. For most homeowners on tighter budgets, an ASHP with the BUS grant is the pragmatic choice.
Can you install a ground source heat pump without a big garden?
Yes, via vertical boreholes drilled 60-200 metres deep. This removes the need for large garden trenches but adds £5,000-£10,000 to the installation cost. Boreholes are suitable for smaller plots and are particularly popular with new-build developments where ground loops are installed before landscaping.
Do air source heat pumps work in cold UK winters?
Yes. Modern ASHPs operate efficiently down to -20C. Efficiency does drop in colder weather (a system rated at COP 3.5 at 7C might deliver COP 2.5 at -5C), but the UK rarely experiences prolonged sub-zero temperatures. The Mitsubishi Ecodan and Daikin Altherma 3 are both designed and tested for UK winter conditions.
Which type is quieter?
Ground source heat pumps are near-silent because the heat exchange happens underground and the indoor unit has no external fan. Air source heat pumps produce 40-55dB at 1 metre from the outdoor unit — comparable to a quiet conversation. The Mitsubishi Ecodan Ultra Quiet operates at 45dB. Noise is rarely a practical issue for either type.
Do both types provide hot water?
Yes. Both ASHP and GSHP systems connect to a hot water cylinder and can heat domestic water to 55-65C. Ground source systems tend to heat water more efficiently due to their higher COP. Both eliminate the need for a separate boiler or immersion heater.
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