Thinking about installing an air source heat pump? One question probably keeps you up at night: "How much is this actually going to cost?"
Good news: the £7,500 government grant makes air source heat pumps much more affordable than they used to be. But let's break down the real numbers — installation costs, running costs, and what you'll actually pay after the grant.
Air Source Heat Pump Installation Costs
Installation costs range from £8,000 to £15,000 depending on your property size, heating system, and installation complexity.
Here's the breakdown by system type:
Air Source Heat Pump (Most Common)
Extracts heat from outside air
£8,000 – £12,000
Cheapest option, suitable for most homes, can work in cold climates
Ground Source Heat Pump
Extracts heat from ground beneath your property
£12,000 – £25,000+
Most expensive, most efficient, requires garden space, longer payback period
Hybrid System (Air Source Heat Pump + Boiler)
Heat pump + existing boiler for backup
£6,000 – £10,000
Cheapest installation, works with existing radiators, good for older homes
What's Included in Installation Costs?
- Heat pump unit (outdoor box)
- Internal unit (typically a hot water tank or fan coil)
- Pipework and connections
- New radiators (if needed) or underfloor heating
- Installation labor (typically 2-3 days)
- MCS certification and compliance testing
Air Source Heat Pump Running Costs vs Gas Boiler
Here's where air source heat pumps shine. They're 3x more efficient than gas boilers, which means much lower heating bills.
Air Source Heat Pump Annual Cost
£500 – £800/year
For a typical 3-bed semi-detached house
Gas Boiler Annual Cost
£1,200 – £1,500/year
For the same property
Annual Saving: £400 – £700 per year compared to gas boiler
5-Year Comparison
Air Source Heat Pump (5 years)
£2,500 – £4,000
Gas Boiler (5 years)
£6,000 – £7,500
How the £7,500 Grant Changes Everything
The government's Boiler Upgrade Scheme gives you £7,500 off a new air source heat pump. This dramatically changes the cost equation.
Real Cost Breakdown (Air Source Heat Pump)
Even better: Your running cost savings (£400-700/year) mean the remaining cost is recouped in 3-4 years. After that, heating is essentially "free."
Real Examples from UK Homes
Example 1: Detached House, Surrey
Example 2: Semi-Detached, Manchester
Key Takeaway
Heat pump installation costs £8,000-£15,000. With the £7,500 grant, you typically pay £2,500-£7,500. Running cost savings of £400-700/year mean most homeowners break even in 3-6 years. After that, you have cheaper heating for the next 15+ years of the air source heat pump's lifespan.