Heat Pump Running Costs vs Gas Boiler: UK 2026 Maths

The most-asked heat-pump question in the UK is whether they actually save money on running costs versus a gas boiler. The honest answer in 2026 is "it depends — on your SCOP, your tariff, and your home's insulation — and the answer can go either way." This guide walks through the underlying maths, applies it to two real UK 2026 tariffs (Ofgem standard cap and Octopus Cosy), runs worked examples at three SCOP scenarios, and is direct about the cases where a heat pump runs MORE expensively than gas. Last reviewed: 12 May 2026.

If you're still deciding whether your home is even suitable, the suitability pillar covers the prerequisite work. If you've decided and are picking an installer, BOXT vs Heatable walks through that decision. This piece is the operating-cost layer underneath both.

Heat-pump versus gas-boiler running costs reduce to a simple comparison: cost per kWh of delivered heat. The two sides:

Gas boiler — the cost-of-heat formula

Cost per kWh of heat = gas price / boiler efficiency

A modern condensing gas boiler runs at approximately 90% efficiency — for every 10 kWh of gas burned, 9 kWh becomes useful heat. At the current Ofgem standard variable tariff (April-June 2026), gas costs 5.74 pence per kWh. So:

5.74p / 0.90 = 6.38 pence per kWh of delivered heat

That's the figure to beat.

Heat pump — the cost-of-heat formula

Cost per kWh of heat = electricity price / SCOP

SCOP (Seasonal Coefficient of Performance) is the ratio of heat output to electricity input across a full UK year. A SCOP of 3.0 means 3 kWh of heat for every 1 kWh of electricity; SCOP of 4.0 means 4 kWh of heat per kWh of electricity. Nesta's monitoring of UK installations reports an average real-world SCOP of approximately 3.9.

At the Ofgem standard electricity rate (24.67p/kWh) and a real-world SCOP of 3.9:

24.67p / 3.9 = 6.33 pence per kWh of delivered heat

The break-even point at standard cap pricing is where electricity-per-kWh ÷ SCOP = gas-per-kWh ÷ 0.90. With 2026 cap prices, that's a required SCOP of:

SCOP = 24.67p ÷ (5.74p / 0.90) = 24.67p ÷ 6.38p = 3.87

So a heat pump needs SCOP ≥ 3.87 to match a modern gas boiler on the standard Ofgem tariff. Real-world averages sit right at that threshold, which is why the running-cost comparison can go either way depending on the specific install.

Take a UK 3-bed semi-detached home with annual space-heating-plus-hot-water demand of about 12,000 kWh of heat per year (a typical average; varies from ~8,000 for a well-insulated small terrace to ~18,000 for a poorly-insulated detached property).

Apply that to three SCOP scenarios on the Ofgem standard variable tariff:

• SCOP 3.0 (poorly-installed or under-insulated home): Electricity needed = 12,000 / 3.0 = 4,000 kWh. Cost = 4,000 × 24.67p = £987 per year.
• SCOP 3.5 (decent install, average UK home): Electricity = 12,000 / 3.5 = 3,429 kWh. Cost = 3,429 × 24.67p = £846 per year.
• SCOP 4.0 (well-installed, well-insulated home, premium kit): Electricity = 12,000 / 4.0 = 3,000 kWh. Cost = 3,000 × 24.67p = £740 per year.

Compare with a modern gas boiler at 90% efficiency on the same demand:

• Gas needed = 12,000 / 0.90 = 13,333 kWh. Cost = 13,333 × 5.74p = £765 per year.

Plus standing charges differ:

• Electricity standing charge (24.67p tariff): 57.21p/day × 365 = £209/year
• Gas standing charge: 29.09p/day × 365 = £106/year
• Net additional standing charge if removing the gas connection: gas household pays £106/year more on standing alone; an all-electric household saves that £106 but still pays the £209 electricity standing.

Bottom line at standard cap pricing (April-June 2026): a heat pump at SCOP 3.0 is roughly £222/year more expensive on energy alone; at SCOP 3.5 it's about £81/year more expensive; at SCOP 4.0 it's about £25/year cheaper; at the real-world average SCOP 3.9 it's roughly £43/year more expensive. Removing the gas connection saves the £106 gas standing charge but doesn't fully close the gap at most realistic SCOPs.

The honest summary: on the Ofgem standard cap, a typical UK heat pump install is broadly cost-comparable to a modern gas boiler — sometimes slightly cheaper, often slightly more expensive. The marketing claim that heat pumps automatically save money on running costs is true only at the very top end of real-world SCOPs.

The standard-tariff calculation assumes you're paying the same rate for every kWh of electricity. UK heat-pump-specific tariffs shift the cost picture significantly by offering deeply discounted off-peak rates that align with the optimal heat-pump operating pattern (heating the hot water tank and pre-heating the home during cheap windows).

The leading example as of 2026 is Cosy Octopus. The structure (April-June 2026):

• Three "cosy" off-peak windows totalling 8 hours/day — 04:00-07:00, 13:00-16:00, 22:00-00:00 — at approximately 14.5p per kWh (51% below the day rate).
• Day rate (the standard rate for the rest of the day): approximately 33.3p per kWh.
• Peak rate (16:00-19:00): approximately 51.7p per kWh (50% above day rate).

A well-configured heat pump shifts the bulk of its heating work into the off-peak windows. The hot-water tank is heated overnight (22:00-00:00 + 04:00-07:00); the home is pre-heated in the 04:00-07:00 window before occupants wake up; the afternoon 13:00-16:00 window covers the second hot-water heat-up.

Assume a heat pump on Cosy Octopus runs roughly 60% of its kWh through off-peak, 30% at day rate, 10% at peak (achievable with good control settings and a properly-sized hot-water tank). The blended effective rate is:

(0.60 × 14.5p) + (0.30 × 33.3p) + (0.10 × 51.7p) = 8.7p + 10.0p + 5.2p = 23.9p per kWh

So at SCOP 3.5 on Cosy Octopus: 12,000 kWh of heat / 3.5 SCOP × 23.9p = £820/year. Marginal improvement on the standard tariff scenario.

A better-optimised home (longer pre-heating windows, larger tank, less peak-hour heating) might run 75% off-peak / 20% day / 5% peak, blending to 18.8p/kWh. At SCOP 3.5 that's: 12,000 / 3.5 × 18.8p = £644/year — comfortably cheaper than a gas boiler at £765.

The real-world Octopus customer data published in early 2026 reports an average £219/year saving versus a gas boiler on the standard tariff for Cosy Octopus heat-pump customers (March 2025 to March 2026 monitoring window). That figure is broadly consistent with the maths above for a moderately-well-optimised installation.

Several genuinely realistic scenarios in which a heat pump comes out more expensive than gas:

• Poorly insulated home, SCOP below 2.5. The maths is unforgiving: 12,000 kWh / 2.5 × 24.67p = £1,184/year vs £765 gas. The Energy Saving Trust is direct on this — "if your home's insulation is poor and your heating demand is high, you likely need bigger radiators throughout the property" to maintain SCOP. Below the SCOP-2.5 line, a heat pump on standard tariff is straightforwardly worse on running cost.
• Standard tariff, no time-of-use optimisation. Even at SCOP 3.5, the standard-tariff comparison comes out roughly £80/year more expensive. The Cosy Octopus saving requires actively shifting load into the off-peak windows, which a default-installed heat pump doesn't do without configuration.
• Properties where the gas tariff is already cheap. Some legacy fixed-rate gas tariffs locked in below the current cap. The arithmetic against a 4p/kWh gas tariff is harder for a heat pump than against the 5.74p current rate.
• Hot water demand significantly higher than space-heating demand. Heat pumps run at lower SCOP for hot-water heating (typical hot-water flow temperature is 50-55°C versus 35-45°C for space heating, and SCOP degrades at higher flow temperatures). A high-DHW-share property may run at effective SCOP 2.8-3.2 even with good kit, narrowing the cost-saving argument.

The honest framing: a heat pump is not automatically cheaper to run. Three things determine whether yours will be: (1) installed SCOP, which depends on installer quality + radiator sizing + insulation + design flow temperature; (2) tariff, which is a separate decision you make after the install; (3) hot-water demand pattern, which is a property of your household.

Three variables move the comparison most strongly:

Electricity vs gas price ratio

The break-even SCOP scales with the ratio of electricity-to-gas pricing. At the current 24.67 / 5.74 = 4.3 ratio, the heat pump break-even SCOP is approximately 3.87 (electricity rate divided by gas rate × boiler efficiency). If electricity prices fall relative to gas — for example, a renewable-heavy grid pulling electricity rates down, or carbon pricing being shifted from electricity onto gas — the break-even SCOP drops. A 3:1 electricity-to-gas ratio would put the break-even at SCOP 2.7, comfortably below most installs. UK Treasury commitments on shifting grid-policy costs are slowly moving the ratio favourably, but the move is gradual.

SCOP improvements over time

The same heat pump installation typically improves SCOP through years 2-5 as the household learns to operate it efficiently: better control settings, larger hot-water tank, lower design flow temperature where the house can take it. A SCOP 3.2 install often becomes a SCOP 3.7 install after two winters of optimisation, which materially improves the running-cost case.

Insulation upgrades

Cavity-wall and loft insulation top-ups before or alongside the heat-pump install reduce the absolute kWh demand (the 12,000 kWh figure above) by typically 20-30% in older UK homes. That reduces the absolute running cost regardless of fuel — a £500 saving on heat-pump running cost on a £150-300 insulation investment with grant support is a faster payback than upgrading the heat pump itself.

The combined effect: a household that starts at SCOP 3.2 / standard tariff / no insulation upgrade can realistically progress to SCOP 3.7 / Cosy Octopus / cavity-walls-filled within 18-24 months, moving the running-cost comparison from "£200/year more than gas" to "£300/year less than gas" — a £500/year swing.

Running cost is one piece of the financial decision. The wider total-cost-of-ownership picture across 15 years (typical heat-pump lifespan):

• Install cost difference: Heat pump install ~£4,000-£8,000 net of the £7,500 BUS grant; new gas boiler ~£2,500-£3,500. Heat-pump capital premium roughly £1,500-£4,500.
• Running cost difference: At realistic Cosy Octopus + SCOP 3.5 settings, ~£200-300/year heat-pump saving vs gas. Over 15 years: £3,000-£4,500.
• Maintenance: Both require annual service (~£150-250); broadly equivalent.
• Replacement parts and component lifespan: Heat pump compressors typically last 12-15 years; gas-boiler components 10-15 years. Roughly equivalent over typical ownership.
• Carbon-pricing risk: Gas prices are more exposed to future carbon-pricing increases than electricity, which is gradually decarbonising. This is a real but uncertain factor — over 15 years, the gas price could rise faster than electricity.

Net: the running-cost saving roughly offsets the capital premium over the lifespan of the heat pump for a moderately-well-optimised install. The decision isn't usually made primarily on financial grounds — it's made on the combination of running-cost arithmetic + decarbonisation goals + property suitability + planning constraints. Read the suitability pillar for the prerequisites and the installer comparison for the install side.