Heat Pump Cost, Grants & Guide 2026

The most common type in the UK. An outdoor unit about the size of a large suitcase absorbs heat from the outside air and transfers it to your central heating and hot water. Works down to -20°C. Costs £8,000–£18,000 installed. Eligible for the £7,500 BUS grant.

Underground loops buried in your garden absorb heat from the ground, where the temperature stays at 8–12°C year-round. More efficient than air source (COP 3.5–4.5 vs 2.5–3.5) but significantly more expensive because of the groundwork - either horizontal trenches or vertical boreholes. Costs £15,000–£35,000 installed. Also eligible for the £7,500 BUS grant.

Combines a small air source heat pump with your existing gas or oil boiler. The heat pump handles most of the heating, and the boiler kicks in when temperatures drop or demand spikes. A good stepping stone if your home is not well enough insulated for a full heat pump. Costs £4,000–£8,000. Not eligible for the BUS grant.

Provides heating and cooling but does not heat water. Uses wall-mounted indoor units (like air conditioning). Common in commercial buildings and warmer climates. Less common in UK homes because most people want hot water from their heating system. Costs £2,000–£5,000. Not eligible for the BUS grant.

Arguments against (or reasons to wait)

• Still more expensive upfront than a gas boiler, even with the grant
• Poorly insulated homes may need costly upgrades before a heat pump makes sense
• You lose instant hot water if switching from a combi boiler - a cylinder is needed
• Some radiators may need upgrading to work at lower flow temperatures
• Running costs are not dramatically cheaper than gas at current energy prices
• Outdoor unit produces some noise - planning and placement need thought

How does a heat pump actually work?

A heat pump works like a fridge in reverse. It absorbs low-grade heat from the outside air (air source) or the ground (ground source) and compresses it to a higher temperature using a refrigerant cycle. That heat is then transferred to your central heating system and hot water cylinder. Even when it is freezing outside, there is enough heat energy in the air for an air source heat pump to work - modern units operate down to -20°C or lower.

Are heat pumps worth it in the UK?

For most homeowners in well-insulated properties, yes. With the £7,500 Boiler Upgrade Scheme grant, the upfront cost gap between a heat pump and a gas boiler has narrowed significantly. Running costs are comparable to gas and much lower than oil or LPG. Heat pumps last 20–25 years (vs 12–15 for a boiler), produce zero direct emissions, and future-proof your home against the gas phase-out planned from 2035. They are less suited to poorly insulated homes where insulation upgrades are not practical.

Can a heat pump heat my whole house?

Yes. A correctly sized heat pump replaces your boiler entirely - it provides all your space heating and hot water. The key is proper sizing: your installer should carry out a room-by-room heat loss calculation to determine the right size unit. Some radiators may need to be upgraded to larger ones because heat pumps run at lower flow temperatures (35–45°C) than gas boilers (60–70°C).

Do I need to rip out my radiators?

Not necessarily. Many existing radiators work fine with a heat pump, especially if your home is well-insulated. Your installer will check each room during the survey. Rooms where the existing radiators are too small for the lower flow temperatures will need larger replacements. Bathrooms and hallways are the most common rooms to need an upgrade. If you have underfloor heating, it works perfectly with a heat pump with no changes needed.

What happens during a power cut?

A heat pump stops working during a power cut - there is no backup heating unless you have a battery storage system or a generator. This is the same as a modern gas boiler, which also needs electricity to run. When the power comes back on, the heat pump restarts automatically.