British Gas has moved to limit the starting price for installing a new heat pump to £2,999, according to an account published on 6 February 2023 by Mitsubishi Electric's learning hub, which described the supplier as "kicking off a price war"1. The announcement was reported as being made "just this month", placing it in February 20231.
Two exclusions attach to the figure. The £2,999 does not include the actual cost of the heat pump, and it will not apply to every house1. No further detail on which properties qualify, or on what the total installed cost would be once the unit itself is added, has been reported1.
The offer sits alongside the Boiler Upgrade Scheme, the government grant open to households in England and Wales1. It is non-means-tested, and pays £5,000 towards a new air source heat pump or £6,000 towards a new ground source heat pump1.
"Just this month British Gas is "kicking off a price war" by promising to limit the starting price for installation of a new heat pump to £2,999"
The wider policy backdrop is a government target of 600,000 heat pump installations per year by 2028, which the same account says would require a tenfold increase on current installation numbers within five years1. Installation cost is described as depending on the size of the home and the number of bathrooms1.
| Item | Figure |
|---|---|
| British Gas starting installation price | £2,999, heat pump excluded1 |
| Boiler Upgrade Scheme, air source | £5,0001 |
| Boiler Upgrade Scheme, ground source | £6,0001 |
| Government target, installations per year by 2028 | 600,0001 |
Why it matters for households
A capped installation price changes the shape of the upfront bill but not its full size. The £2,999 covers fitting work only, so a household comparing it against a gas or oil boiler replacement is still comparing a partial figure against a complete one1. The grant is the other half of the arithmetic: £5,000 for an air source unit or £6,000 for ground source, available in England and Wales and not means-tested1.
For a home's energy independence, the shift is structural rather than financial. An air source heat pump replaces the gas or oil boiler outright, heating hot water and the water in radiators or underfloor heating, with no gas or oil on site1. It runs on electricity, so the household's exposure moves from the gas network to the electricity supply and to whatever arrangement it has for that electricity1. The account notes that buying from a renewable electricity supplier is the logical pairing, otherwise, it says, the ethics of the change are open to question1.
Efficiency of the existing system is the other variable. A gas or oil boiler more than 12 to 15 years old that has not been regularly serviced is described as probably quite inefficient, meaning the household is paying for heating that is generations behind current performance1. Heat pumps themselves are described as tried, tested and refined for over 15 years, able to draw heat from outside air even with snow and ice on the ground, and monitorable remotely from a phone1.
What happens next
No dated next steps for the British Gas offer have been reported, including when it opens, when it closes or how households apply1. The Boiler Upgrade Scheme is described as open for applications in England and Wales at the time of writing1.
Sources1 cited
- The challenges for our renewable heating future, les.mitsubishielectric.co.uk