Heat pump running costs are often oversold as a dramatic saving against gas. The honest 2026 picture is closer, and this calculator shows exactly why: on a standard tariff, a heat pump and a gas boiler cost roughly the same to run, and it's the Boiler Upgrade Scheme grant, plus an optional heat-pump-specific tariff, that actually make the numbers work.
How this calculation works
Install costs are estimated by home size, and a £7,500 Boiler Upgrade Scheme grant is applied automatically to the heat pump figure. Running costs are estimated using typical 2026 Ofgem price cap rates for both gas and electricity, with the heat pump's efficiency (its coefficient of performance) built into the estimate. Switching the tariff toggle to a heat-pump-specific tariff applies the genuinely cheaper off-peak electricity rate these tariffs offer, which is where most of the real running-cost saving actually comes from.
A well-installed heat pump and a modern gas boiler cost roughly the same to run on a standard electricity tariff, sometimes the heat pump is marginally cheaper, sometimes marginally more expensive, depending on your specific property's insulation and the heat pump's real-world efficiency. The financial case for switching in 2026 rests mainly on the grant closing the upfront cost gap, not on large ongoing bill savings, unless you also move to a heat-pump-specific tariff.
Frequently asked questions
If running costs are similar, why would anyone install a heat pump?
The grant closes most of the upfront cost gap, heat pumps typically have a longer working life than a gas boiler, they cut a home's carbon emissions by up to 70%, and switching to a heat-pump-specific tariff genuinely does unlock a real running cost saving. It's a reasonable choice for many households, just not primarily because of dramatic day-to-day bill savings on a standard tariff.
Does my home's insulation affect these numbers?
Yes, significantly. A poorly insulated home makes a heat pump work harder to maintain temperature, which can push its running cost above a gas boiler's. Good insulation and radiators sized correctly for lower flow temperatures are genuinely important for a heat pump to perform close to its rated efficiency.
Am I eligible for the £7,500 grant?
Eligibility depends on your property and current heating system. See our Green Mortgages and Heat Pump Grants guide for the full Boiler Upgrade Scheme criteria, including the higher £9,000 grant for oil or LPG households.
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