I think that £15,000 - £20,000 is more realistic costs to install an air source heat pump in a medium sized Chiswick house (say 1,200 sq ft) including upgrading the radiators to fan assisted radiators.So, a grant of £5k, plus the saved cost for a gas boiler £3k = £8k.Leaves a £7k to £12k shortfall. But... instead of costing say £800 a year to heat a house with gas, if wholesale gas prices stay where they are it will cost maybe £2,400 - £3,000.Then again, electricity prices have also doubled (but not quadrupled), so it will probably cost about £1,500 now to run a heat pump.So the saving in running costs (assuming energy prices stay where they are) may be around £1,000 - £1,500 a year for a heat pump over gas (until the recent increases, the running costs would have been about the same, because gas was a lot cheaper).So a heat pump may give a saving of say at least £1,000 a year in running costs (and less maintenance, etc). So the return on the investment on the extra cost is between 8% - 14% p.a. Which is a good return for someone who has spare cash sitting in the bank, or can borrow more cheaply than that. Payback in full would be less than 10 years. Then you are in profit.This is a very rough and ready as a calculation. The problems are: (a) many people don't have the spare cash lying around, or can't borrow that cheaply; (b) it is likely that gas prices will reduce from the extraordinarily high levels after a year or so (particularly if we address the problems caused by leaving the EU Internal Energy Market, which have driven up UK gas prices by far more than within the EU), so in the longer term, although gas is likely to increase more than electricity the difference in overall costs may reduce. So there is still an economic argument to be made for heat pumps in many cases. None the less, the government needs to do much more, so that this is not just a subsidy for the rich. They may do this in a negative way, by switching the green levy from electricity onto gas to make gas more expensive (which has a logic, but will cause massive problems for many people whilst gas prices remain as high as they are).
T P Howell ● 1832d