The method
Every heating system turns a fuel into heat with some efficiency. A gas boiler turns most of the energy in gas into heat; a direct electric heater turns all of its electricity into heat; a heat pump turns each unit of electricity into several units of heat by moving it from outside. So the price of a unit of heat is the fuel's unit rate divided by the efficiency:
- Heat pump: electricity unit rate ÷ seasonal efficiency (SPF).
- Gas boiler: gas unit rate ÷ boiler efficiency.
- Direct electric: electricity unit rate ÷ 1.
The default prices
The calculator starts from Ofgem's price cap for 1 October to 31 December 2026, the average for Great Britain on Direct Debit: electricity 26.32p per kWh with a standing charge of 54.83p a day, and gas 7.97p per kWh with 29.68p a day. The gas figure includes 5% VAT. Electricity on domestic bills in Great Britain carries no VAT from 1 October 2026 to 30 June 2027 under HMRC's temporary zero rate. The cap changes every quarter, next on 1 January 2027, so the defaults will date; your own bill is always the better input.
At the cap rates
| System and efficiency | Pence per kWh of heat |
|---|
| Heat pump, 2.5 | 10.53p |
|---|
| Heat pump, 2.8 | 9.40p |
|---|
| Heat pump, 3.0 | 8.77p |
|---|
| Heat pump, 3.5 | 7.52p |
|---|
| Gas boiler, 85% (assumed) | 9.38p |
|---|
| Gas boiler, 90% (assumed) | 8.86p |
|---|
| Direct electric | 26.32p |
|---|
Ofgem price cap, 1 October to 31 December 2026. Boiler efficiencies are assumptions. Standing charges not included.
Three things stand out. Against direct electric heating, a heat pump's heat is a fraction of the price at any realistic efficiency. Against gas, the two are close at these prices, and the heat pump's real seasonal efficiency decides which is cheaper. And the efficiency range matters more than any other input: the step from 2.5 to 3.5 changes the heat pump's figure by more than a quarter.
From a unit of heat to a bill
To get a yearly heating cost you need the home's annual heat demand, which only a heat-loss calculation or past bills can give. As a sense of scale, Ofgem's typical consumption value for a medium gas user, used for price-cap comparisons from July 2026, is 9,500 kWh of gas a year, down from 11,500; that includes hot water and cooking, and is an average, not a guide to your home. Then add standing charges. A household that disconnects from gas entirely also stops paying the gas standing charge; one that keeps a gas hob does not.
What moves the answer most
- The heat pump's real efficiency. Driven by flow temperature, sizing and controls.
- Your electricity tariff. Some tariffs have cheaper periods that suit heat pumps; see electricity tariffs.
- What you are replacing. The comparison with gas is close; with oil, LPG or direct electric, compare your actual fuel price per kWh.
A worked example, per unit of heat
Suppose your bill shows electricity at 24p a kWh on a fixed deal and gas at 7p, and an installer's design expects a seasonal efficiency of 3.0. The heat pump's heat costs 24 ÷ 3.0 = 8.00p a kWh. A 90% gas boiler's heat costs 7 ÷ 0.9 = 7.78p. Almost level. If the design expects 3.5 instead, the heat pump's figure falls to 6.86p and it pulls ahead; at 2.5 it rises to 9.60p and gas stays cheaper. The same arithmetic, with your own numbers, is what the calculator above does.