This is a key part of the reason why UK sales of heat pumps are the lowest in Europe per capita.
Because heat pumps run on electricity, the cost of it has a direct impact on consumer demand.
Heat pumps typically cost around £2,500 more than gas boilers, even after a Government grant that is available to help pay for them.
At the moment, electricity costs 3.9 times as much as gas to produce the same amount of energy in the UK – with electricity costing 24.50 pence per kilowatt hour (kWh) compared to 6.24 pence for gas, according to Ofgem.
Furthermore, the carbon tax to discourage fossil fuel use – charged on the carbon dioxide produced when generating electricity – is not applied to the gas burned in central heating boilers.
Experts say this is likely to be the biggest reason why the country’s uptake of heat pumps is the lowest in Europe.
This means it will take longer to pay off the higher upfront costs of installing a heat pump through savings on heating bills, which are due to the greater efficiency of heat pumps compared to gas boilers.
“The number-one reason for this lack of take-up so far is that the ratio of electricity to gas price in the UK is the highest in Europe.
Heat pumps take heat from the air outside the building, bringing it inside and amplifying it to the required temperature – using the same technology as an air conditioner but in reverse.
But until the price of electricity comes down, those efficiency benefits are largely masked, experts say.
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“Alternatively, Government could shift levies to general taxation which would lover the price of electricity for households but not affect gas prices,” he said.
Dr Doug Parr, Greenpeace UK’s policy director, told The i Paper: “Without a major increase in Government investment aimed at bringing down the upfront costs [of heat pumps]; more wind and solar energy in our grid to bring down the cost of electricity; and the delivery of a nationwide heat pump roll out scheme, the Government’s target of 600,000 installations a year by 2028 will be difficult to meet.
Dr Simon Harrison, of engineering consultancy Mott MacDonald, agrees that progress is being held back by a lack of heat pump engineers, but says this will improve as the industry “scales up” in the coming years.
Another good way to spur heat pump installations is to ban gas boilers in new homes, as has been done in countries such as Denmark, Austria, Belgium and the Netherlands, where heat pump uptake is much higher.
UK heat pump installations have also suffered because the UK had so much cheap North Sea gas for so long, gas central heating has become engrained in the UK heating system in a way it hasn’t in other countries, scientists say.
Although the UK will need to significantly increase heat pump installations in the coming years if it is to have any chance of meeting its goals, last year did see a big improvement, with a 42 per cent rise in sales.
What does the Government say?
“We are making heat pumps more affordable by providing £7,500 towards the cost through the Boiler Upgrade Scheme, and have recently announced plans to remove planning constraints to make them easier to install.”
Meanwhile, the Heat Pump Training Grant is providing 10,000 opportunities to train up heat pump and heat network professionals, and the number of installers being trained is keeping pace with increasing household demand for heat pumps.
The Government didn not comment on whether it would look to bring down the price of electricity relative to gas.
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