Alt: New gas boiler next to an air source heat pump unit — UK home heating comparison
A new gas boiler costs £2,000-£3,500 installed. An air source heat pump costs £8,000-£14,000, but the £7,500 Boiler Upgrade Scheme (BUS) grant brings the net cost down to £500-£6,500 (GOV.UK, Boiler Upgrade Scheme). At April 2026 Ofgem price cap rates (gas 5.74p/kWh, electricity 24.67p/kWh), annual running costs are roughly comparable: £800-£1,100 for a gas boiler versus £700-£1,100 for a heat pump with a COP of 3.0. Over 20 years, a heat pump saves approximately £3,900 in total cost of ownership (Energy Saving Trust).
Head-to-head comparison table
| Factor | New Gas Boiler | Air Source Heat Pump |
|---|---|---|
| Installed cost | £2,000-£3,500 | £8,000-£14,000 |
| After BUS grant | N/A | £500-£6,500 |
| Annual running cost (Ofgem April 2026) | £800-£1,100 | £700-£1,100 |
| Efficiency | 92-94% | 300-400% (COP 3.0-4.0) |
| Lifespan | 12-15 years | 20-25 years |
| Maintenance cost/year | £60-£120 | £100-£200 |
| Carbon emissions | ~2.0 tonnes CO2/year | ~0.8 tonnes CO2/year |
| Installation time | 1 day | 2-3 days |
| Disruption | Minimal | Moderate (outdoor unit, possible radiator upgrades) |
| Future-proofing | Gas phase-out risk from 2035 | Fully aligned with government decarbonisation policy |
How much does each option cost upfront?
With the BUS grant, a heat pump can cost the same as or less than a premium gas boiler. The numbers:
New gas boiler:
- Budget combi (Ideal Logic Max): £1,800-£2,200 installed
- Mid-range combi (Worcester Bosch Greenstar 4000): £2,200-£2,800 installed
- Premium combi (Vaillant ecoTEC Plus): £2,300-£3,000 installed
- System boiler + cylinder: £2,500-£3,500 installed
Air source heat pump:
- Typical installed cost: £8,000-£14,000
- BUS grant: -£7,500
- Net cost after grant: £500-£6,500
- Average net cost: £3,000-£5,000
The BUS grant is applied directly to your invoice by the installer — you never pay the full amount. Your installer must be MCS-certified to apply (MCS, Boiler Upgrade Scheme requirements).
From 28 April 2026, air-to-air heat pumps are also eligible for a separate £2,500 grant, though only one grant per property can be claimed.
How do running costs compare?
On a standard tariff, gas boilers and heat pumps cost roughly the same to run. On a heat pump tariff, the heat pump wins. Here is the maths for a typical 3-bed semi using 12,000 kWh of heating per year:
Gas boiler (93% efficiency):
- Gas consumed: 12,903 kWh (12,000 / 0.93)
- Cost at 5.74p/kWh: £741/year
- Add standing charge (£106/year) and hot water: ~£900-£1,100/year total
Heat pump (COP 3.0):
- Electricity consumed: 4,000 kWh (12,000 / 3.0)
- Cost at 24.67p/kWh (standard tariff): £987/year
- Cost at ~14p/kWh (off-peak/heat pump tariff, e.g. Octopus Cosy): £560/year
On the standard Ofgem tariff, running costs are broadly similar. On a dedicated heat pump tariff with off-peak rates around 14p/kWh, a heat pump saves £250-£400 per year compared to gas.
What about long-term savings?
Over a 20-year period, a heat pump saves approximately £3,900 compared to a gas boiler (Energy Saving Trust). This accounts for:
- Lower running costs (especially on heat pump tariffs)
- Longer lifespan (20-25 years vs 12-15 years for a gas boiler — meaning you avoid paying for a second boiler)
- Rising gas prices relative to electricity as the grid decarbonises
- Potential future carbon taxes on domestic gas use
The crossover point — where cumulative heat pump savings exceed the higher upfront cost — typically arrives within 8-12 years, depending on your tariff and home insulation.
Is your home suitable for a heat pump?
Heat pumps work best in well-insulated homes with adequate radiator capacity. Before switching, consider:
- Insulation: A heat pump operates at lower flow temperatures (35-45C) than a gas boiler (60-80C). Your home needs good loft insulation (270mm+), cavity wall insulation, and double glazing as a minimum.
- Radiators: Some radiators may need upsizing to deliver enough heat at lower flow temperatures. Budget £1,500-£3,000 for radiator upgrades if needed.
- Outdoor space: An air source heat pump needs a clear outdoor area of roughly 1m x 1m, with good airflow around the unit.
- Noise: Modern heat pumps operate at 40-45 dB (similar to a fridge). Planning rules require placement at least 1 metre from a boundary.
- EPC rating: Homes with an EPC rating of D or above are typically suitable. Homes rated E-G may need insulation upgrades first.
What about the gas boiler phase-out?
The UK government has confirmed that gas boilers will not meet the Future Homes Standard for new builds, effectively banning them in new homes from 2025. For existing homes, there is no mandatory phase-out date. The previous 2035 ban on new gas boiler installations in existing homes has been scrapped (GOV.UK, January 2025).
However, the direction of travel is clear: the government is investing heavily in heat pump adoption, with the BUS budget nearly doubled to £295 million, and planning rules relaxed for heat pump installations. Gas boilers will remain legal to install in existing homes for the foreseeable future, but a heat pump future-proofs your home against potential future restrictions and rising gas costs.
For more on how hydrogen-ready boilers fit into this picture, see our hydrogen-ready boiler vs heat pump comparison.
The verdict: boiler or heat pump?
Choose a heat pump if: Your home is well insulated (EPC C or above), you can access the £7,500 BUS grant, and you want to future-proof against rising gas prices and potential carbon taxes. The long-term economics favour the heat pump.
Choose a gas boiler if: Your home needs significant insulation upgrades before a heat pump would work efficiently, you want the lowest upfront cost, or you need a quick like-for-like replacement with minimal disruption.
For more on boiler options and costs, visit our main boilers page.
FAQ
Is a heat pump cheaper than a gas boiler in 2026?
After the £7,500 BUS grant, a heat pump costs £500-£6,500 — comparable to a mid-range gas boiler at £2,000-£3,500. Running costs are similar on standard tariffs but the heat pump is cheaper on dedicated heat pump electricity tariffs. Over 20 years, the heat pump saves roughly £3,900 in total.
How much is the Boiler Upgrade Scheme grant in 2026?
The BUS grant provides £7,500 towards an air source or ground source heat pump. From 28 April 2026, air-to-air heat pumps qualify for a separate £2,500 grant. Only one grant per property. Your MCS-certified installer applies on your behalf.
Can I get a heat pump in a terraced house?
Yes. Air source heat pumps are regularly installed in terraced houses. The outdoor unit needs roughly 1m x 1m of space and must be at least 1 metre from a boundary. Noise levels of modern units (40-45 dB) meet planning requirements for most terraced properties.
Will gas boilers be banned in the UK?
There is no mandatory ban on gas boilers in existing homes. The previous 2035 phase-out target has been scrapped. However, gas boilers will not meet the Future Homes Standard for new builds. The government’s long-term strategy favours electrification via heat pumps.
Do I need to upgrade my radiators for a heat pump?
Possibly. Heat pumps run at lower flow temperatures (35-45C vs 60-80C for gas boilers), so some radiators may need to be larger to deliver the same warmth. A heat pump installer will assess your system. Budget £1,500-£3,000 for radiator upgrades if required.
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