A heat pump is an energy efficient way to deliver heating and hot water to a home using electrical energy. On average, a heat pump uses 1 kilowatt of electricity to produce approximately 3 kilowatts of heat (exact efficiencies will depend on the size of the system and outdoor temperatures).
So, a heat pump is almost certainly more cost-effective to operate than an oil-based heating system, or a direct electric heating system such as storage heaters, fan heaters or underfloor mat type. For homes that are off the gas grid, an electric heat pump can therefore make a lot of sense in terms of lowering running costs.
UK energy costs in early 2022 mean that the unit rate of electricity is around four times more expensive per kilowatt hour than gas. This means that even though a heat pump is very efficient, in some cases it may be more expensive to operate than a modern gas boiler at this time. But the UK is looking to achieve net zero carbon emissions by 2050, so we are moving away from using natural gas. We are therefore likely to see gas prices rising in the next few years to a point where they overtake electricity prices. At that point, it would make sense to consider lowering energy bills by switching to an energy efficient heat pump.
One option is to consider making your own electricity. As an electric heating system, heat pumps can also be powered from solar panels (photovoltaics). Depending on heating and hot water needs, and the number of solar panels, this could be cost-effective to operate – although the initial costs of installation and suitability of the property would have to be considered.