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Heat pumps still 'too expensive' warns national spending watchdog

heat pumps

Heat pump sales continue to be hampered by high costs, low awareness and a lack of long-term financial support, the government’s spending watchdog has warned.

The National Audit Office says ministers were optimistic to think that the target of installing 600,000 low-carbon heat pumps annually could be reached by 2028 as only 55,000 heat pumps were sold in the UK in 2022. It has urged the government to increase public awareness of the green technology and work to reduce costs.

The National Infrastructure Commission (NIC) estimates that air source heat pumps cost £10,000 more than a gas boiler on average, while electricity is more expensive per unit than gas, making heat pumps potentially more expensive to run.

However, by using the £7,500 Boiler Upgrade Scheme grant, some energy companies are offering heat pumps for as low as £500. The government says after the grant was increased last year, applications grew by nearly 40%.


Swedish company Aira has just launched a heat pump paid for in 12 interest-free monthly instalments along with a 15-year ‘comfort guarantee’ in which it takes responsibility for performance, product and installation warranty.

It promises that this will save 25% on heating compared to a boiler. The overall cost is between £3,000 and £7,000 after the government grant, although the company also hopes to provide a financing solution that would spread the payments over a decade, as it offers in Italy.

In a bid to encourage take-up and widen the reach of who can apply under the BUS, the Department for Energy Security and Net Zero has now scrapped the requirement for properties to have a valid EPC (less than 10 years old) with no outstanding recommendations for loft or cavity wall insulation. This could reduce the costs associated with installing a heat pump on a semi-detached property by about £2,500.


Daniel Särefjord (pictured) Aira UK CEO, tells LandlordZONE: “We offer private landlords and homeowners the flexibility to either purchase the Aira Heat Pump outright or to select our all-inclusive plan, which requires no upfront payment and offers affordable monthly installations.

"The new Aira Heat Pump uses Aira Intelligence to optimise and improve efficiency over time, learning the home's routine and household habits in order to precision plan the heating and hot water.

"It also monitors the weather forecast to maintain your home at the right temperature and offers Away Mode, so you can save energy and money while you're away and ensure a cosy climate on your arrival home."

Read the NAO report in full


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