Capital cost comparison (London 2026)
Gas boiler replacement: £2,400–£4,800 supplied, installed and commissioned. Air source heat pump full install: £14,500–£21,500 gross, less £7,500 Boiler Upgrade Scheme grant = £7,000–£14,000 net. Heat pump includes outdoor unit, hot water cylinder (typically 250–300L), buffer tank, smart controls and radiator upgrades. Larger London terraces often need 2–4 radiator replacements to lower-temperature larger units — add £1,500–£3,500. Solid wall properties may need insulation upgrade first.
Running cost comparison
Heat pump efficiency measured as Coefficient of Performance (COP) — typically 3.0–4.0 (i.e. 1 kWh electricity in delivers 3–4 kWh heat). Gas boiler 0.94 (94%). At 2026 typical tariffs (electricity ~28p/kWh, gas ~7p/kWh) a heat pump at COP 3.5 costs 8p per kWh delivered vs gas at 7.4p per kWh. Marginal favour gas. On specialist heat pump tariffs (~14p/kWh off-peak) heat pump becomes 4p per kWh — clear winner. Insulation level dictates running cost more than fuel choice.
Best-fit home for each
Heat pump wins: well-insulated homes (post-2010 builds, fully retrofitted Victorian terraces with EWI/cavity fill + loft insulation), homes with low-temp underfloor heating, owners willing to use heat pump tariff. Gas boiler wins: solid wall Victorian properties with no insulation plans, homes with high peak demand and small outdoor space (no room for monobloc unit), heritage properties where outdoor units are unacceptable visually. Many London renovations are excellent ASHP candidates — fully insulate during renovation, then heat pump becomes obvious choice.
