We are at a crossroads. We committed to going down the sustainability route when we moved into Home Farm, and one of the major upgrades was installing an air source heat pump. At the time we looked at energy requirement projections and from a sustainability and financial perspective it looked like a simple choice to make. Two and a half years later, we’ve been placed in a tricky situation due to the rising price of electricity. I started having concerns about this in February, but things have accelerated much faster than anticipated.
When we committed to our air source heat pump in 2019, an electricity tariff of 15p (£0.15) per kWh was easy to come by. Towards the end of last year, we started to struggle to get providers at that mark, and switched to Symbio Energy, who had very low tariffs but that have been going up in small increments during 2021.
This week we received an email from Symbio that they would be increasing their set tariff to 19.453p/kWh from the 14.50p we were on since March.
In the February post about our concerns, we used our January data to calculate and project potential running costs. We consumed 2,231 kWh of electricity in January (the bulk of which was used by the air source heat pump) and that was on a very competitive tariff (around 11p/kWh). Since March, we’ve been paying 14.5p/kWh and as of this week we’re on 19.5p/kWh. That’s a steep price increase in a very short period of time. If we fast forward to January 2022, and we have similar consumption on the back of another cold winter, what would that mean?
The numbers aren’t great. In January 2021, we paid £245 for consuming 2,231 kWh of power (excluding standing rates). By comparison, on our latest bombshell of a tariff, we would pay a staggering £435. This is a ridiculous extra amount of money. I’ve scoured the comparison websites and have filled in loads of quotes, and the cheapest tariff we can now get is 18.5p/kWh.
The UK government has been pushing households to switch to heat pumps, but with these crazy tariffs, it’s simply not viable from a financial perspective when compared to other fuels.
The latest rate from our oil club is under 40p per litre for diesel. That means we could heat our house in January for £200, £50 less than our best running cost using renewable heating, and £235 cheaper than our new electricity tariff. The financial portion of the equation is dramatically out of whack with the sustainability part. Quite frankly, the cost of being sustainable simply ceases to be viable, and at some point personal financial sustainability has to be taken into account.
As a side point, I don’t know how electricity tariffs work, but we’re in a rural setting in the Welsh borders and our tariffs are higher than in cities and towns, which is a discriminatory practice given the standing fees we are all paying to maintain the grid. I know of people living near big cities that are still getting a rate of 15p/kWh from Symbio Energy.
I firmly believe that the UK government must do something to address the spiralling cost of electricity because the cost of sustainable, renewable heating is not financially sustainable in its current state. And it doesn’t matter if you have a small or large home. The price of heating will catapult for all heat pump owners, and they’ll be paying more for their heating this winter if prices don’t come down.
So we will need a contingency in case we can’t find a tariff closer to 15p/kWh. My initial thought process is to make our bivalent system more bivalent, while not affecting our RHI payments. I will call our heat pump manufacturers, Global Energy System, and speak to them about how we can set up our system so that the heat pump only works when outdoor temperatures are above 5C, as this is our threshold at which the heat pump becomes less efficient and starts to consume much more power. If temperatures drop below 5C, the oil boiler will take over the heating. I’m hoping that the software and system can do something like this.
We may even consider running the heat pump during the day only, and letting the oil boiler take over the night shift. We’ll see how things unfold in the weeks ahead, and at least we have time to come up with a solid plan.
I’m certain that we are not alone in facing this dilemma, and it poses a real problem for sustainable, renewable heating. If the only financial alternative for people is burning fossil fuels, what hope do we have of cutting carbon emissions?
The last thing we want to do as a household, which is trying to be as sustainable as possible, is to burn through for 500 litres of oil a month to heat the house, but our choices have been greatly reduced by the rising electricity tariffs. Has the cost of heat pump sustainability already become too high? I hope not, but we’ll have to see what the future has in store.
That’s really worrying – we are literally just about to fit our heat pump and are in an equally rural location. To be honest I’ve struggled to get our electricity costs as low as yours anyway, so our costs will likely be even higher than yours. We have a similar sized house by the look of it but don’t have an oil boiler (it would be very difficult to fit apparently) or solar.
I agonised over going down the Oil or Heat Pump path and having bought into the RHI scheme (which I will be very lucky to get now due to my EPC) I am also very concerned about fitting a very expensive system to my house that costs an arm and leg to be lukewarm at best….
I’m hoping that this is a pricing blip connected to inflated gas prices, which the UK’s electricity grid is still largely powered by.
Please remind me where you’re based and what your tariff is?
Hi Mars we’re about 10mins north of Shrewsbury but in a very remote location at the end of the power loop. So I think it’s very expensive to supply our house as I have really struggled to get competitive quotes. We are currently with octopus which amazingly was the cheapest provider for our house and the contract has now expired so we can shift. I am sweating a bit to be honest.
I think we’re all sweating Simon. I’m surprised that your rate is so high despite being so close to Shrewsbury. That’s confusing. End of the power loop or not, I think it’s unfair practice given that we’re all paying daily standing fees for our power. We’re at the end of the loop for our water supply, but we don’t have to pay more that.
Don’t we have a national Grid? I don’t understand why prices of electricity should change depending on where you live. We import electricity from France, have Nuclear Power, electricity from wind farms and that generated by solar. All this is fed into the Grid and is distributed to our homes. I can’t see the logic of postcode pricing. I don’t think suppliers have to make standing charges, it’s one way of trying to keep headline prices per KwHr low. I have mains gas and during the summer the gas standing charges are more than the cost of gas used for cooking and hot water, which seems crazy.
I’ve wondered the same thing Malx.
You can take some comfort that the UK Government doesn’t think electricity prices will rise much after 2021.(look for residential electric prices row 101)
Not sure personally if I believe prices will stabilise though.
https://assets.publishing.service.gov.uk/government/uploads/system/uploads/attachment_data/file/931212/Annex-M-price-growth-assumption__EEP2019_.ods
Thanks Steffan. I’m not entirely sure that it will stabilise either. It may be a bumpy ride.
Nice Post Mars. Sums it up completely. I am sticking with oil at present but do heat my water at night using octopus go at 5p per unit. Obviously this might change at any moment but for me this works.
Looking at tepeo electric boiler which stores 40kwh. This would be viable if it could be charged at night on the 5p rate.
Time will tell.
Love the Website and reviews, keep up the good work.
cheers Keith.
I was looking to get Ashp and the option was a 16kwh system for heat only and gas combi for water.
However am now thinking of getting the Daikin 8kwh Altherma hybrid so it uses which evers cheapest to run as you set your prices and temp thresholds.
Have you thought if Octopus Go faster as I just got quoted 15.5p peak rates
I have a Samsung 16kWh output ASHP for both UFH and hot water tank, UFH runs at 30c and tank at 45c. We use immersion to get tank to 60c once a week for hygiene.
Mars may I ask are you figures monthly?
Hi Lisa. Here’s our ASHP usage breakdown, month by month, for 2020 which should hopefully give you the insights you’re looking for: https://myhomefarm.co.uk/air-source-heat-pump-performance-for-2020
Hi Mars, this is the sort of thing that I have been constantly thinking about over the last few days. I’m considering having an oil boiler fitted and basically switching over to oil at the same time as we all move our clocks in October and March to keep things simple. We’ve only had one winter in our new house with ASHP and I reckon we would be warmer and save £800 to £1000 a year by doing this and would recoup the £5k cost in about 6 years. I’m all for going greener but if it’s not financially sensible then I and many others just won’t. What do you think?
Sadly, I’m in agreement with you. A large portion of the UK’s electricity is generated by gas, especially at nighttime, so heat pumps are still indirectly producing CO2.
We are continuing to insulate the house where we need to prevent heat loss, and our new K3 rads will offer more overall efficiency.
Honestly, if our financial increase was smaller to run the heat pump, we’d suck it up. But when it’s almost double the running costs of alternative fuels, financial sustainability must be taken into account.
Very interesting and shocking at the same time. Can I ask if you have solar panels? I’m in a unique position that I’m buying a house with a recently added ASHP and planning to have solar panels (4KW) and a storage battery (4.8KW) added to the system. the idea is during the day time the panels produce enough electricity for consumption and storage for the ASHP. Then use an Octopus night time tariff to top up storage battery at night.
Does this system approach make sense and would it help with your situation?
Yes, we have a 6.16kW solar array. The issue is that from Dec-Feb, due to limited daylight hours and the low positing of the sun in the sky, the solar PV doesn’t produce the amount of power needed to offset the heat pump during the day. Performance is also worse when it’s overcast.
Using your smart tariff to top up batteries is a great idea. That will help. I don’t know what size your heat pump is, but in our case the heat pump would get through 4.8 kWh in just over two hours if the temperature outside was 5C or less.
I hope that helps.
Agree with Mars, our ASHP uses 5kWh therefore would use all of the power in less than an hour and that’s not taking into account anything else that would drain the battery. We are installing a 27kW battery to complement our 6.25kW solar array. In the winter we will be using our E7 tariff to arbitrage the cost of electricity during the day.
Wow, that’s a lot of battery storage Mark. Impressive. Which brand have you opted for?
It will be 2 Tesla Powerwalls giving 13.5kWh storage each with 5kWh output for each powerwall.
When you get your panels make sure they give you an estimated generation rate for the winter months. In January this year we struggled to get more than 2Kwh/day, partly due to shading from a large barn during the winter. Toyed with the idea of getting some ground mounted panels but I know adding more generation isn’t always straightforward.
Good advice Ken.
I just looked at our solar numbers from December-February, 131kWh, 161kWh and 270kWh respectively, an average of about 6kWh per day. We have no shading to speak of. Compare that July, 823kWh, and you can see how much poorer the performance is in the winter months.
I think the big issue here is the critical cold months when solar production is at its worst which also coincides withe maximum power draw of the ASHP and as such the capital cost of a battery system (which would require recharging overnight on off peak tariff) would need a capital investment probably equal or greater to the heat pump.
You have crystallised my thoughts entirely. We fitted an ASHP in November 2020. Comparisons made for oil at 50p per litre and electricity at 11p per KWh.
With Electricity now 20p + per KWh and oil at less than 40p per litre. The sums don’t stack up. Without RHI for next six years we will be losing out big time. If Government really wants to encourage ASHP installation they should/ must introduce a special tariff.
On another note. How can I ensure that ASHP only operates when air temp is above 5C?or at least during the cheaper night time tariff.
The numbers really aren’t stacking up, and it’s going to be interesting to see where things go from here.
I had a chat to GES (our manufacturers) today and there are few tricks we can do, but they will all have to be done manually as the software can’t automate this. I’m going to have a look at the control panel, taking what they said into consideration, and see what we can do. I have one good idea that should work, and will share that as a new post over the weekend (if it works).
What brand heat pump do you have John?
We have LG 14Kw Heat Pump and also an electric car. Pump is set to 50c and to heat water tank via immersion to 60c once a week.
There is also a supplementary log burner in main room which is super efficient.
All radiators have been supersized and I am insulating all accessible areas to 300mm on top of the 100mm already present. The house was cavity filled with Shell bonded beads in the early 1980s. There is no problem in getting the house warm but it is proving to be more expensive than oil in the winter. Radiators would still get hot even at -10c, although ASHP iced up and needed to self defrost from time to time. Heat pump is on NW facing wall. Plenty of hot water at all times. I keep minimum temp to 15C with 18C in the evenings in the hallway which gives 22c in the sitting and dining room.
Any suggestions on settings would be appreciated. RHI makes costs bearable at present.
It’s really concerning that even people who have already paid out the capital costs of an ASHP are considering switching to oil. Something (I don’t know what) has to be done to close the gap between electricity and fossil fuel price per kWh.
Imagine the outcry if BEVs suddenly became more expensive to run per mile than petrol/diesel.
That’s exactly right Kevin. Running costs have been controlled and something has to be done to keep homeowners and consumers motivated.
Hi Mars, I share your real and genuine concerns, heat pumps are fantastic in the right climate and I feel that ours isn’t ! Ours is 8 months old and during the really cold winter we weren’t warm enough and we’re paying over £350 a month to heat the house, and then logs on top. I’m startIng to wonder if we have made a smart move. My tarrif is wiht igloo and it’s 17.6 per kWh up from 11.6 12 months ago.
We’ve invested 11k in the system and expect the RHI to cover 60% of that outlay, a comparable oil combi would have been 6k and we would have continuous hot water……..it’s not easy being green !
Or fair it seems. I think the government need to step in to make the market viable
Thanks
Anna
I think the fundamental point is that not all properties are suitable for an effective heat pump solution. That could because the capital injection and disruption to optimise the circulation system in the house and reduce building heat losses to something sensible are unpalatable, OR the building is not suitable – terraced housing where noise is an issue (either from the occupier or neighbours perspective).
Then there is the issue of equity. Calls for government action may have validity but the government does not have money but redistributes tax revenue. We need to be careful that this redistributing does not unfairly penalise low income taxpayers who just cannot fit a heat pump OR with greenhouse gas levies on domestic heating where no realistic choice exists.
I am not anti heat pump – it’s a great solution in the right location, the right building and with sound system design.
I am not a fan of subsidising people who can afford their own capital investments – be that heat pumps or electric vehicles.
Hi Mars how all is well with you, I have been offline for a bit but now back and working on the next developments with the house. I agree entirely with your comments and it was the same for me when I did the research, the bottom line seems to be that Airsource while it is a real solution for many people I think it is only a real solution when you have everything else in order, such as great insulation and upgraded heating options such as underfloor or oversized rads. it is entirely true that the Government is going to have to bring in some kind of monetary offset if they are going to get people to switch to alternatives and away from gas and oil. I decided against an airsource heat pump at this time because I am waiting to see what the next 5 years brings in way of technology to offset the costs. im upgrading my rads and doing whole house insulation with an internal shell on all the external facing walls. I’m not filling my cavity walls as will cause more issues than it solves in a house in the far northern highlands besides the sea ! I think the best way for getting real benefit from renewables right now is to have a good solar array with augmented battery.
Nice to hear from you again Bob. Fully agree with you said, and interesting to hear you’ve moved away from the ASHP. Are you going down the oil route?
Out of curiosity, what issues will filling wall cavities cause? Will that not affect your overall heat loss?
Thermal storage and time-of-use tariffs are the key to mitigating against higher electricity costs at the moment. Government is well aware that the spark gap (the difference between electricity and fossil fuel pricing) is a problem. This will get addressed in some way over the coming decade, potentially starting in 2025 or so. Regressing to oil is a temporary solution at best, because the Heat & Buildings Strategy (due in September) is likely to include plans to phase out the use of oil completely. The Heat Pump Federation will take up the issue of rural cost surcharges with electricity suppliers. Octopus, Good Energy and Centrica are members, so will respond to questioning on this point. If you have a bivalent system, you will be metered for payment of the RHI. In this case, increasing the proportion of heat coming from oil will reduce the RHI payments. The Heat Pump Federation is always happy to respond to consumer questions about heat pump deployment and operation. There is a consumer advice section on the HPF website
As you know Bean, I am a supporter of renewable technology and especially heat pumps. I now live in a new build property fitted with an ASHP. This was one of the reasons why I chose this as our new home. As you know, I also worked for several years on the Domestic RHI team for Ofgem. Since moving in here I have noticed that the rising cost of electricity was making it more and more expensive to heat our home and began to worry we were doing something wrong.
It turns out we were not, and the heat pump itself was not at fault either. The problem was the rising cost of electricity. We installed 4kW of solar PV as soon as we moved in here but, even with that, we have seen the cost to heat our home through the winter go up and up.
We initially chose the Octopus Agile tariff, thinking it would be a good move to track wholesale prices. Again, that was not the right decision as recently we were paying on average a cost of almost 21p/kWh. We have now moved to Octopus Go and now benefit from a fixed price of just under 16p/kWh and a reduce price of 5p during the hours of 00:30 to 04:30. We will save even more in the winter when our heat pump (correctly set to run continuously) will use the cheaper lecky cost during the night when it’s coldest outside.
Your journey sounds like ours and echoes the concerns of so many other homeowners with heat pumps. What makes this scary and financially precarious is that there is now one remaining tariff at 16p/kWh. I’ve checked for our area and the next cheapest one is 18.5p, then a few at 19.5p, with the majority of provides well over 20p – some have tariffs over 30p. Bonkers.
Roger Bisby (of the Skill builder You Tube channel) has done a great couple of short videos on this very subject which deserve watching.
My health warning is to look beyond the ranting – he does this deliberately to provoke discussion and focus and reflection on the underlying points.
The fundamental take away point is that while the heat pump unit itself can be very efficient it is only one part of the system – the major part of the system is the house itself. Heat pumps cannot just be plugged into a house and expected to be efficient either in terms of the energy consumed or in achieving acceptable habitable temperatures. The whole system has to be designed by a heating engineer and the first part of that process is assessing the building, it’s heat loss, it’s defects and deficiencies. The current mandated calculations done to comply with RHI are largely spreadsheet driven, so theoretical ‘rule of thumb’ calculations that are rarely augmented with practical inspection and use of thermal imaging cameras to map out gross heat transmission ‘fractures’.
The harsh reality is for much of the housing stock is that to get the heat losses down to a reasonable number to allow low circulation temperatures (for maximising SCOP) the cost, disruption and the ruination of existing finishes to rectify building defects, bring insulation levels to any sort of acceptable effectiveness and incorporate positive heat recovery ventilation systems are just beyond the pale. This applies equally to the housing stock currently been thrown together by the major and very profitable developers.
The whole issue of a substantive lack of a strategic energy policy and the use of coherent subsidies (yes the oil industry has had billions over recent history) is another subject I could write tomes about – but choose not to do here.
Can heat pumps be successfully incorporated into a house – absolutely they can but only with fully effective design and execution of the ‘whole system’.
I fully agree with you Norman. Some excellent points. The fact there are many poorly designed and installed systems has allowed skeptics to have a loud drum to bang on. I can vouch for the significant amount of skeptics because since Roger posted his heat pump rant, we’ve seen a bump in our air source heat pump video viewing numbers and have been inundated with negative comments citing (of unpleasantly) how oil and gas is the only way to heat homes. We know that it isn’t, but since we find ourselves at the crossroads, most people will opt to take the path that’s cheapest with the least issues. There aren’t going to be a lot of takers for a more expensive system that may or may not be designed and installed properly, with running costs that far exceed existing fuels. The next few years will be very interesting.
A friend recently purchased a new build which has PV and an ASHP installed but the builder wanted 7k to fit an underfloor heating system. The Government needs to ensure that builders install underfloor heating systems as standard into new builds, it is far easy to fit and cost effective when laying the slab than to retro fit after.
Agreed. Retrofit UFH is a massive job, with a lot of upheaval.
We did a retrofit UFH system when we referbed our bangalow so can confirm it was hard work but was worth it in the end.
Hi Mars
Sorry to hear you have been trolled – that’s social media for you.
Is that why you deleted the You Tube links I provided?
Looking forward to learning more about your investigations with the control panel and implementing your idea.
All the best to you both.
NormanB
We just delete the comments and have a chuckle at some of the crazy and outlandish ones, but we keep ones with opposing views that are well articulated and have a genuine argument.
Yes, that’s why we deleted the direct links to Roger’s videos for that reason. I find the situation odd, because there are so many people out there that are fundamentally and passionately opposed to heat pumps, and videos like Roger’s incite them. It gives them fuel because they have a prominent YouTube channel loading the argument in their favour. Heat pumps are far from perfect, but they offer a means of pumping less CO2 into the atmosphere and people lose sight of that.
Thanks for your honest reply and respect your position.
I do not believe however, that in the long term, government policy should be set out on the basis of flawed assumptions. The current government policy is myopic in setting up a belief that the heat pump is a practical and affordable solution for every house in the UK housing stock. There needs to be honest recognition of that.
Stifling honest discussion runs the risk of perpetuating a flawed policy (The UK government has a poor track record on actually understanding any technological subject or in fact housing and building standards).
The Heat Pump Industry needs to be at the forefront of educating Government.
In the meanwhile Heat Pumps are going to be installed in unsuitable housing and saddle the homeowner with big bills who will demand a remedy by increased tax payer subsidy.
I am not anti heat pump. I would love one. I live in a detached not untypical UK major developer house built 1999. I have estimated I would need to spend £20K and live through significant disruption to insulate this home, replace (effectively) all the central heating pipework (micro bore drops) and the make good finished floors and walls. I have no practical place for an air source heat pump without disturbing two neighbours (yes 1999 detached in the South East) are densely packed.
Hi Mars, I have been sceptical of heat pumps for a while now.
If you have the time have a look at Roger Bisby’s (Skill Builder) rant about them.
Although he makes some comedic points, I feel the bulk of what he’s saying is spot on. One of the key conclusions is that heat pumps won’t get significantly better – rather gas and oil will get more expensive, so making heat pumps look more attractive. I feel it’s a giant con.
I did watch Roger’s rants and got the gist of what he was trying to convey, and he does pander to the skeptics.
Honestly, I’m not skeptical about heat pumps at all, because if designed and installed correctly, with the right heat emitters, they definitely work. My concerns that I’ve shared in this post centre around the running costs if electricity prices continue to rise, while oil maintains or goes down – heat pumps, from an efficiency perspective are still great.
Hi – you have probably covered this somewhere so I do apologise. So are you saying that your ASHP has not been installed and designed correctly and if it had you’d be okay?
There were a few issues that had to be addressed in our case to get some rooms to temperature, which took us two winters to figure out. This involved upsizing radiators and getting a bigger distribution pump in. We covered everything in this video if you’d like more details: https://youtu.be/Fk4hqbukoAA
Heat pumps do not need to get “significant better”. They are already significantly better from a carbon perspective than any fossil fuel boiler. The operational cost issue is entirely political. Fossil fuels have been pulled out of the ground at a price which completely fails to value the environmental damage for over 150 years. That is a great deal of ground to make up. If you do not believe that the climate is changing and that human activity is a driver, then you won’t care. If, on the other hand, you accept the principle of global warming driven by the burning of fossil fuels, you will want to do something about it. Is it acceptable to trash both the financial future of the next generations as well as the planet they will be living on? World governments need to find a way of fairly apportioning costs. No simple task, but a solution is needed now.
That’s spot on, and the oil and gas lobby is still strong with massive financial backing, which is again evident in the push for hydrogen heating. We can’t deny that climate change has been caused by burning fossil fuels and releasing trillions (yes, trillions) of CO2 into the atmosphere.
Heat pumps have had their reputation dented by poor design and installation. We were in that boat to some extent and have hopefully remedied our issues this spring. So what needs to get significantly better is installers that design and correctly size heat pumps. If that gets addressed, and cowboy installers are replaced with competent ones, the reputation of heat pumps will improve.
Write to your MPs. The Government needs to hear from us. They want heat pump installations to increase so that 600,000 are being installed in 2028. This is not going to happen if people are paying high electricity rates and upfront costs. I wrote to my MP last week about our experience of the costs of installing an ASHP – my guess is that most of the MPs don’t know anything about heat pumps.
That’s a good idea Julie. I will send our MP an email. I think our MP will be familiar with heat pumps, and I think this a good way to raise some much needed awareness.
I quite agree that the rising electricity prices are a big concern to heat pump owners. We have an ASHP in a brand new, EPC ‘B’ rated property (built 2020) with UFH. We immediately added 4kW of PV as we are all electric, plus my wife has a PHEV car so it made sense to help reduce our grid demand. Originally we signed up to the Octopus Agile tariff, thinking we would benefit from this. Not so. We found that most recently we were getting an aggregated price of almost 21p/kWh and our bungalow was costing much more to heat that our old, 10930’s London semi.
We’ve switched to the Octopus Go tariff (we qualify as we have a part electric car) and now benefit from a fixed tariff of below 16p/kWh, plus it drops to 5p between 00:30 and 04:30. This will not only help us now but even more so during winter as the heat pump is set to run continuously so when it’s coldest at night we will be on cheap electricity.
It will be interesting to see what our annual cost will be on the lower tariff. I’ll be keeping track of this for sure!
Thanks for sharing Keith. I think we may have to consider a smart metre.
New to this site, wish I’d found it months/years ago! Fascinating thread. I am 6 months into planning of a big refurb to a late 60s house in the Cotswolds. First step was 7.2kWp of west facing solar PV which came online a few days ago. Partial EWI and retrofit UFH is all in the mix. I am currently on Octopus Go which is a great tariff, but to get paid for any export I will have to leave that and drop to either a standard variable tariff or Agile, which yes is now up at 20p+. At this time of year we are as expected in good surplus in the afternoon if the weather is half decent. However if we do some big cooking on the induction hob at dinner time on a dull day, I’ll be paying peak ~30p from 4-7:30pm on Agile. Batteries would mitigate, but I paused on getting with the solar PV as I want to see how generation and consumption pan out of the next year or so.
Thank you for your comments and for sharing your running costs Tom. You have echoed our sentiments about the higher costs of peak electricity on smart tariffs.
You’ll find that solar production from Nov-Feb is typically quite poor, so you won’t have much excess/surplus to charge the batteries. Also, are you considering an air source heat pump as part of your refurb plans? On the subject of batteries, we also couldn’t find a way of getting them to pay for themselves, so we shelved the idea. What a lot of people do though is charge their batteries at say 4am when tariffs are low and then use that power at peak times. That could work. But the investment from a financial perspective never made sense to us given the life of batteries. Would be interested to hear your thoughts.
Hi Tom, we’re on Octopus Go and are also paid by Octopus for our export so I’m not sure why you think you have to be on the SVT or Agile? We were on Agile but switched a few weeks ago as the prices were crippling and our lifestyle didn’t suit us avoiding the 4pm to 7pm period that would often be the 35p/kWh rate. We started around the 16p rate at the beginning of the year but it crept up to 21p on average in the summer. That’s mad as I would have thought electricity should have been cheaper in the summer when it’s less in demand?
@Keith ah that is interesting – which outgoing tariff are you on? The restriction is mentioned on the Octopus site here https://octopus.energy/outgoing/ (see the ‘Good to know’ bullets near the bottom of the page). I can see why they have this restriction – it would be too good to be true otherwise – you could charge batteries at 5p overnight then unload to the grid in the afternoon at 20-25p! Regarding prices overall, they are going up across the board; apparently there has been oversupply of gas in recent times that has suppressed the price. It will be interesting to see if Octopus Go tariff also goes up in line with the others, I suspect it will, and shortly. @Mars, yes the UFH is being specified with pipe spacing suitable for ASHP (150mm), and obviously, additional insulation to the house fabric where possible. We will be using the current gas boiler, which is barely 4 years old, for the time being, until I see the lay of the land with ASHP capital costs, RHI, elec prices, etc. over the next couple of years.
Hi Tom, We’re on the Octopus Fixed Price export tariff of 5.5p/kWh and whilst we obviously have solar PV we don’t have any battery storage, so we don’t fall foul of the variable outgoing tariff that you linked to. We could earn more from that export tariff but, to be honest, we try and use as much of our solar generation as possible, so probably wouldn’t benefit much. Our import tariff is also fixed for 12 months (@ 15.96p/kWh) so we’re shielded somewhat from price rises too.
You mention RHI (I used to work on this program for the Ofgem team) and you’re probably aware the scheme has been extended from shutting down in April this year (due to the pandemic) but is due to close in April 2022, so if you do apply please make sure it’s before the door closes.
The government is due to release a new heat & building strategy next month (delayed from January) but I have no idea if any successor to the domestic RHI is proposed. I’ve seen murmurs of an up-front grant scheme instead of the present in arrears, 7 years of quarterly payments based on metered renewable heat generated, but it may not be as rewarding.
I think solar PV is (still) a decent investment as we want to use our heat pump as little as possible during the sunnier months. 4.2kW (installed capacity) cost us £4K and on a good day we get 3.5kW+ at peak times. Even so, payback will be 10+ years I estimate. We use a Solar iBoost to pass excess solar energy to the immersion heater in our tank where the thermostat is set to 60C to avoid Legionella. Our heat pump sets the DHW tank temp to 50C normally (it uses a different thermostat) so if the solar PV ‘tops this up to 60C’ we can have a shower and the tank temp stays above the 40C level that would trigger the heat pump to come on again.
I’ve found that in the summer, using the heat pump to heat our DHW is nowhere as efficient as when we use if for space heating. I’ve no idea why this is and will be asking my installer when he comes next month to do the annual service. It’s not the immersion heater kicking in as we’ve switched that off from grid electricity and it only uses excess from the solar PV. If anyone has any insight as to the heat pump (in) efficiency heating DHW in the summer I would be pleased to hear from them.
Ok it makes sense that they would allow fixed outgoing with Go incoming. I will seriously consider that.
Re: poor heat pump performace with DHW, does your tank have a big coil that is good for use with ASHP? It needs to return water to the heat pump at a nice low temp.
Hi Tom, the system is a Mitsubishi Electric (ME) Ecodan heat pump and pre-plumbed DHW cylinder so it comes as one ‘lump’ from the manufacturer. The DHW heating coil is the one chosen by the manufacturer also, designed to suit the heat pump output so I must assume the sizing and operation (again operation is controlled by the manufacturer ME’s FTC5 control box as that comes as part of the pre-plumbed configuration) is done to suit the best of all worlds.
Afternoon Keith, the reason that the air-source is less efficient when doing hot water only is that it is working on a relatively high fixed temperature (you mentioned 50C. When doing heating was well, the heating effort is probably weather compensated to increase the efficiency, so two circuits, one fixed temperature for DHW and one variable temperature for heating. As the heating is the larger demand, this pulls up the average efficiency quite a bit.
Thanks Bean, good point well made. As I say, I’m still learning about heat pumps and I’m glad I have one of the best teachers that I call a friend!
Hi I note your points on the cost per kWh, I am currently in the process of evaluating Solar PV, Powerwalls and an ASHP. Im not sure if you are aware but octopus energy is offering a flat 12p import / export tariff, if you have pwerwalls.
When I did the math on this tariff, the whole thing looks a lot more sustainable as the export achievable in the summer can really help offset the large winter usage.
Don’t know wether you have considered it, but looked a lot better than the numbers when using PV only and the poultry SEG export payments.
Nice idea but at £9-10,000 for a Tesla Powerwall installation it would take us 15+ years to get payback. As I’ve read in another comment, “If it takes over 15 years to get payback it probably never does”. More importantly, at my age (66) I may not live another 15 years so will just have to hope electricity prices do stabilise.
Hi Mars
My concern is not just for the cost we have to outlay to run the pump. I worked in social housing for a number of years and we installed gshp & ASHP without PV to solve fuel poverty in off grid locations !
Those poor souls are now faced with a hard cold winter and no support.
This needs to be addressed for the whole not the few, and RHI is a great incentive but only benefits the buyer, in social housing the tenant has no choice but to use the expensive ashp
Wrong !
Anna
Never thought about it from the perspective of social housing. You are correct. It is wrong, and I have no idea how this can be corrected in the short or long term.
If displacing direct electric resistive heat in social housing, then a heat pump (correctly specified and installed) will be lower cost to operate. I anticipate proactive moves by government to reduce electricity prices relative to fossil fuels around the middle of the decade. It is a fundamental that it will eventually be cheaper to heat with low carbon electricity (heat pumps) than with fossil fuels. The timescale to reach the tipping point is not yet defined. There may be something on this topic in the Heat & Buildings Strategy due to be published in September.
For Fraser and others, rather than a standalone battery, if you are likely to invest in an EV any time soon, that has the potential to become your home battery. With vehicle-to-grid in play, you could charge the car with PV or even with an overnight low cost tariff, and then sell back to the grid when prices are highest between 4.00pm and 8.00pm. Effectively, you would eb trading electricity between high and low value periods. Depending upon your vehicle usage, the EV battery might serve most of the purpose that a wall hung battery would do.
V2G is hugely appealing, but the last I read it was still years from becoming a reality. I stand to be corrected.
https://www.octopusev.com/powerloop
In play on the UKPN network, but it was a restricted trial. Likely to become the model for future V2G services
Which vehicles support V2G? (I understand it is the later 2020 Leafs only) and which DNO’s approve? (I understand only been done as a limited trial and no universal approval).
I too had long conversations with a chap who was representing an ASHP company. Great technology and would be ideal in my house. He could not and would not be drawn on the running costs, using “norms” that they had experienced from previous installations they had carried out. Having watched the Skill builder videos as well as many “pro” ashp videos it does leave the consumer a bit bewildered. I could not get straight in my mind the pros and cons of it all. The installer said they’d replace any radiators that needed to be larger, but when hearing that the pipework may not be sized suitably to serve these new radiators it put me off the whole idea significantly. I actually didn’t factor in electricity price increases as I thought that gas would go up at the same rate. It does surprise me to hear oil prices are reducing when the actual price of crude is going up ! Having spent a lot of time on this research Im going to sit back for a few years and stick with my gas system, however much it galls me to keep burning stuff Im very much in favour of looking after my finances as best I can versus the green planet. Most unfortunate.
Reply to TonyG
Have a look at Heat Geek on YouTube for a more balanced view in reaction to Roger Bisby’s Heatpump videos. It is also a great channel to better understand the fundamental principles which have been largely ignored over the last generation and compensated by fitting larger capacity boilers (gas & oil) which are able to compensate for system problems by injecting loads more KW of heat to circulate very higher temperature fluid.
Great suggestion Norman. Heat Geek’s responses were professional and unbiased.
The Summer period reduces the demand in the Grid overall, so that is when deeper maintenance is scheduled on generating plant. So in effect, the margin to cope with peak demand is similar to winter. Hence the supply/demand/surplus/price curve will be pretty similar throughout the year.
Thank you for the lovely post on the cost of sustainability ????
So the gov are talking about banning gas boilers in the future so how on earth do you think they will allow oil – they will ban them. They will be introducing a carbon tax as soon as they sought out the International details and then the price of oil will hit the roof. Do not revert to oil.
Home farm never seem to talk about their wood burners so i guess they are just green wash. If they have oil boiler as well as wood stoves then they must have a air leaky house or they will die of CO. These all need to be blocked off. External wall insulation on east wall will cut losses and improve thermal mass. Then find a sweater and turn the temp down ( 1C = 10% + saving). In fact the overall savings could be over 20% as the HP will not need to work so hard and the COP will improve. Perhaps need to use thermal image camera in winter.
Octopus Go tariff is 15.59p inc and 5p for 4 hrs at night. Whats wrong with that?
re: ASHP real world results over a season, this might be of interest https://community.openenergymonitor.org/t/heat-pump-experiment-review-after-two-years/18402
Sorry, I asked a question in an older post here: https://myhomefarm.co.uk/potential-air-source-heat-pump-running-cost-issue without having seen this post. Please ignore that, as you’ve answered many of my questions.
I hope the situation improves.
Just looking at a few tariffs now and 20p -22p is about median. how do you calcs stack out at 20p, 30p and 40p per Kw/hr? Costs are only going up with more demand for ev’s heatpumps etc.
Government and, critically, Treasury now accepts that the cost of electricity is a barrier to decarbonisation. It’s reported that action will be taken to deal with this around mid-decade, so consulting on how this might done is likely to start around Q4 2022. It is also likely that taxation on gas will be increased because is is revenue raising so is more attractive to Treasury. Whilst there is a good deal of short term pain, the future is clearly going to be electric and so the fuel costs will swing in favour of heat pumps over the life cycle of the hardware. One of the things that consumers can do now is to set up their heat pumps to facilitate access to off-peak tariffs by using thermal storage. Electricity suppliers will become increasingly creative in this respect as the markets for EVs and heat pumps mature.
Thank you for the excellent insights Bean. The short term pains, in my opinion, will be a major barrier for people looking to switch to heat pumps. This is definitely something we can discuss in the interview next week. Really looking forward to it.
Electricity prices are what ‘did for’ the UK steel industry – they did diddly squat about that. In other words – don’t hold your breath.
We can only really speak from our personal perspective but anything over 15p doesn’t make the heat pumps attractive to run. 22p is very expensive and 30-40p per kWh is unaffordable. We need prices well below 20p.
I would recommend a Smart meter install and Octopus Go as a matter of urgency. I had mine done within 2 weeks of moving in.
On heat pump related, I wonder if there is any scope for, in the winter season, large thermal stores (e.g. 500l) that can be heated to UFH flow temps at full blast on 5p cheap rate elec for 4 hours, then drained during the day? I haven’t seen this approach anywhere yet (buffer tanks are used but these are much lower volume and used to smooth out the load of a relatively small water volume UFH system).
Have a look at a company called Caldera, they are looking into heat stones.
New to this forum having only found it a week ago. Im building a brand new house in HA6. I was so keen on solar, ASHP, etc for but having done all the maths I’m sad to say that I will be going for a gas boiler and no solar. With electricity prices now averaging 25p/KWh and the RHI being removed it doesn’t make any economic sense for me to go down this route. Solar doesn’t even pay for itself after 15 years so that’s a no go either. At best I might be able to generate 30kw a day in the summer and perhaps be able to store around 10kw but that’s not going to help me then when I dont have such a high demand. In the winter is when we all suck up gas and electricity. Such a shame that there must be so many people who are putting off doing the right thing. What I am going to do is cavity wall insulation, external insulation and have MVHR to try and reduce my gas consumption.
Hi Sam, have you looked at underfloor wet heating system this works with either gas and/or ASHP. With your plans for insulation a underfloor wet system would work well. Mark
Thanks Mark.
Yes we are having UFH on the ground floor and are going to oversize our radiators on the first floor by 20% so they can be run at a lower temp. In addition, the builder will be putting reflective panels behind them all.
Maybe one day we will put in an ASHP when they become economically more viable.
Just some layman maths but if you assume year round COP for an ASHP is 2.5 and the equivalent for gas is 0.5 then I guess the price of electricity needs (per unit KWH) needs to be less than 5 times more for ongoing ASHP costs to be favourable. At the moment it’s around 5 so probably parity. Maybe this community feels the electricity hike more because not affected as much by gas prices? I think the other thing is ASHP are on all year round whereas my gas is on for 60 mins a day for 6 months just for DHW.
Just look at what is happening to gas prices. ASHP may seem uneconomical now but prices will be manipulated to make Gas prohibitively expensive. Think longer term before making your final decision.
I think you have done your homework and you are are making wise decisions in terms of super insulating your home and installing MVHR, I assume you are working to meet ‘passive hause’ standards (easy on new build and impossible to retrofit). It is a goal worth achieving.
Fitting a gas boiler may seem retrograde to some but it is your choice to make. Just remember not all boilers are equal and neither are gas engineers who in the main fit over powered boilers way in excess of requirement, usually with poor modulation and although ‘condensing boilers’ in theory rarely spend any time condensing – so not efficient and spend the much of the time cycling on and off.
It is worth engaging a professional heating engineer, consider underfloor heating everywhere and do not use small bore pipework anywhere in the system. The key is matching the boiler to match the heat loss requirement of your ‘passive house’ and not just go up a couple of sizes just in case. Next is circulating lower temperature water round the underfloor so that the boiler is always in condensing mode and selecting a boiler with good modulation and control so that it ramps up and down through the power band as required without cycling on and off. The overall control of the system should also accommodate weather compensation. Viessman do some particular good boilers in this regard.
I would though perhaps rethink on solar, and maybe think outside of the box when it comes to the concept of ‘payback period’ we do not evaluate that metric on our cars, iPhones, Computers et al. Solar can certainly ‘insulate’ you from future energy shocks in the future and reduce your gas consumption further by providing your hot water during the summer, and maybe heating a third of it in the winter. If you perceive an EV in your future then being able to keep the car topped up essentially for free has to be a consideration too. I am not that convinced of the economics of a home battery system but if you were having an EV then that offers all the advantages of an ‘energy sink’ without additional cost.
I agree with Norman B’s comments, I would add that having a home battery can protect you against power cuts . National grid have warned of possible power shortages this winter. Also, in the UK we can charge the batteries using cheap rate tariffs and then use this stored power during high tariff periods.
Thanks Norman. I really appreciate your comments. I can’t pretend to understand everything you said about gas boilers but now I’ve ruled out an ASHP (for the time being), I can focus my attention on that aspect to ensure I take account of all your points. I will revisit solar as I do take on board what you’re saying. I know zappi charge points utilise an EV car’s battery as a sink so maybe that’s the way to go rather than the battery route which seems overly expensive and an inefficienct.
Sam
Sorry I posted late at night so probably did not explain it as well as I could.
You can do no better than at least talk to Andrew Millward (07855 420381). He is very knowledgeable and competent. I have no connection other than I saw some of his You Tube videos and as an engineer myself was impressed with his grasp of the requirement to get the whole system absolutely right rather than just hang an oversized white box on the wall and scarper. So much so, I will be using him to fit a replacement boiler et al at my gaff in the not too distant future – and will be funding his hotel stay during the work as he is at a distance from me.
If you are in the early design phase at least give him a call and explore the potential to collaborate on this aspect. Maybe have a look at some of his YT videos too.
Best Wishes.
Thanks. Will do
One of the joys of reading the comments above is that they have all been written by articulate people who can express themselves well. I have contacted my local MP and have had a reply from, presumably, one of his research assistants which did not answer any of the queries I had posed, merely spouting the usual policy of encouraging the use of alternative energy etc.
One of my only gripes regarding posts here is the use of metre/meter. One is a measurement of length, music or poetry, and the other is a measuring device or flow meter to determine the amount of electricity, gas or fluid used. Sorry for pedantry.