Hi Simon
Heat Pumps available at the moment have an initial capital outlay of between £7,000 and £15,000 for a domestic home property.
This will depend on whether it is a Air Source ( cheaper to install) or Ground Source more expensive due to ground works.
The biggest savings are when a heat pump is fitted to an off gas grid property that uses Oil/ LPG gas or Electric for its heating and hot water needs.
This type of property will see a 50% saving on there annual fuel bill compared to Oil,LPG or Electric
There is currently an RHI payment from the Government that is payable in quarterly payments for 7 years straight into a customers bank account to offset the initial cost of installation.
To give you an idea we are fitting a Air Source Heat Pump to a property in Cornwall this week that is currently using an oil boiler for there heating and hot water it is a 4 bedroom property and there last 3 years fuel bills have averaged around £1500
Installation of the pump will save the property around £700 a year in energy costs, they will no longer have an oil bill to pay but the increase will come on there electric bill as this is the power source for a heat pump.
Efficiency of the pump means that for every 1 unit of electric in produces 3 to 4 units of heat out.
The property will receive Renewable Heat Incentive Payments of £1040 a year for 7 years these payments will rise with inflation so our client is going to receive around £7800 in total.
The 7 year saving on energy costs is going to be 7 x £700 approx so another £4,900
Making payments and savings over a 7 year period to be around £12,700
The cost of this weeks installation is £8,900 that includes VAT which is charged at just 5% for renewable technology so you can see of great benefit to the customer that has the initial capital outlay.
Heat Pumps have very little maintenance and would last a customer 25+ years so even after renewable heat incentive payments finish after 7 years the savings on fuel are still being maintained.
So are they expensive, compared to a general heating system the answer is yes but that expense is soon paid back, the above scenario has a payback period of just under 5 years
All the Best Simon
South West Energy Services Ltd
