Rural households switching to heat pump face 70pc rise in bills, industry group says
Rural households could see their heating bills increase by more than two thirds if they switch to using heat pumps in line with the Government’s net zero targets, according to figures from an industry trade body.
Data calculated by the Energy and Utilities Alliance (EUA) showed that the cost of running a heat pump for rural homes is more than 70 per cent higher per year than a conventional oil boiler.
For roughly 9,894 kWhs of heat, the total amount of energy required to heat a rural property for one year, the running cost of a heat pump would be £1060.20, while an oil boiler would cost just £617.81, a difference of 71.5 per cent.
The Government wants to install 600,000 heat pumps a year by 2028 and ban all new oil boilers by 2026, as well as put eight million electric vehicles (EVs) on UK roads by 2030 as part of the push to meet Net Zero targets.
The proposals have prompted fears in rural communities, where millions of people are not connected to the gas grid and so rely on oil heating, that antiquated local infrastructure will not be able to cope with the sudden demand on electricity.
Speaking in the House of Commons on Tuesday, Sir Bill Wiggin, MP for North Herefordshire, said: “Rural areas tend to have limited infrastructure, meaning that it is impractical and uneconomical to deploy heat pump installations in every home.
“Many rural homes, particularly older or listed buildings, are not designed to accommodate these systems.”
The costs associated with upgrading are also significantly higher than staying with conventional boilers. While a replacement oil boiler typically costs £2,500, heat pumps retail in the region of £13,000, according to the EUA.
In an attempt to soften the blow of switching to alternative heating, the Government offers grants of between £5,000 and £6,000 for households to purchase and install a heat pump and advocates argue that this price will reduce as the industry grows.
But fewer than 10,000 heat pumps were installed during the first year of the roll-out programme, falling far short of the target of 30,000.
Some £90 million of unspent subsidies are set to be handed back to the Treasury due to the lacklustre uptake.
Mike Foster, chief executive of the EUA, said: “The government has promised that from 2026 people living in homes off the gas grid – that is typically in rural areas of Britain – would not be able to replace a broken boiler with a new one. By law they would be forced to have a heat pump.
“That is not something that most rational people would do as a choice and if they are forced to do it then the political backlash would be immense.”
Charlotte Lee, chief executive of the Heat Pump Association, said work was being done to reduce the cost of heat pumps and that it was possible to get one for as little as £3,000 under Ofgem’s Boiler Upgrade Scheme.
“We encourage homeowners interested in installing a heat pump to shop around,” she said.
“Heat pump running costs will fall drastically as wholesale electricity prices fall and as environmental and social obligations on gas and electricity bills are re-balanced.”
She said that rebalancing the “policy costs” between electricity and gas bills could improve heat pump running costs by £246 relative to gas boilers.
