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The future of low-carbon heating is heat pumps
Heat pumps are around 4 times as efficient as gas boilers. With low-carbon electricity, they will reduce our heating emissions close to zero.
There are a few massive technologies that will decarbonise most of the world. You decarbonise electricity from renewables and nuclear. Transport from electric cars (and, obviously, public transport and cyclable cities). Heating by moving from boilers to heat pumps.
Deploy those at scale and you’ve addressed a massive chunk of the world’s carbon emissions.
But while I thought the heating solution was obvious, the UK government is thinking about pulling back on its plan to switch, rather than pushing forward faster. This would be a poor decision. I want to make my case for why they’re the best heating solution we have, and what can be done to make them better.
How does a heat pump work?
Heat pumps are often described as refrigerators, but in reverse.
Heat pumps capture air from outside a building – or heat from the ground in a ground-source pump – and use this heat to warm a liquid refrigerant, turning it into a gas. Electricity is then used in the pump to compress this gas, and release it at a higher temperature. This heated gas can then either be moved around the home in its gas form, or transferred to a hot water system. As heat is transferred around the home, this gas cools and ultimately turns into liquid again. That completes the cycle.
Sounds straightforward, but not revolutionary, so far. And maybe not that impressive if they need lots of electricity to run.
Except heat pumps are incredibly efficient at transferring heat. You get a lot more heat out than you put in in the form electricity. For every unit of electricity you put in, you get 3 to 4 units of heat out. This is because heat pumps harvest heat from the air, ground, or water around them.
Current heat pump models are 3 to 5 times as efficient as gas boilers. It’s an incredibly neat piece of engineering.
Heat pumps use less gas than a traditional boiler, even if all of the electricity comes from gas
There are a few reasons why countries want to move away from gas. First, to reduce greenhouse gas emissions. Second, to reduce their dependency on gas imports. This was bumped up even higher on the priority list following Russia’s invasion of Ukraine.
But, does switching to a heat pump really reduce our dependency on gas? What if countries get a lot of their electricity from gas? Perhaps we’re just substituting the dependency from one source to another.
The short answer is yes: even if a country ran all of its electricity on gas (which no country does), moving to heat pumps would mean less gas overall.
Simon Evans from the Carbon Brief ran the numbers, and found that it would cut gas demand by two-fifths. Let’s run through them to understand how this works.
You need 10,000 kWh of heating in your home. To get this from an efficient gas boiler, you’d need to buy and use around 12,000 kWh of gas. That’s because an efficient boiler is around 83% efficient.
To produce 10,000 kWh from a heat pump instead, you’d only need around 3,300 kWh of electricity. That’s because two-thirds of the heat is coming from the ambient air; so it gives around 6,600 kWh, the electricity demand is 3,300 kWh and that totals up to 10,000 kWh. Remember, that you get 3 to 4 times as much heat out of a heat pump as you put in.
So we need 3,300 kWh of electricity. If you were to get all of this from gas, then you’d need about twice this figure going into the gas power plant. That’s because the efficiency is only around 50%: only half of the inputs are converted into electricity, and the other half is lost as heat. That means we’d need to burn 6,600 kWh of gas for a heat pump.
Stack these up next to each other and we have our final result: you need to burn 12,000 kWh of gas for a gas boiler, and 6,600 kWh for a heat pump powered entirely by gas.
That’s a saving of 45%. I think this result could even be conservative: Simon assumed that the output-input ratio of heat pumps was 3, but many can get as high as 4. If we run the numbers on this assumption, it cuts demand by three-fifths.
The data is clear: if you want to reduce gas demand, moving to heat pumps is a very good way to do so.
Heat pumps are among the most effective ways to reduce carbon emissions
You’ve produced an extra unit of low-carbon electricity. What’s the most effective way to use it to reduce emissions?
The UK’s Climate Change Committee (CCC) gives its recommendation below. The best option is to displace a unit of coal electricity. The second is to power an electric car. The third is to power a heat pump.
Heat pumps really do save a lot of carbon. Just ‘how much’ depends on the electricity mix. This is the same situation as for electric cars.
The International Energy Agency’s central estimate is that heat pumps cut emissions by at least half, compared to gas boilers. In the chart below we see the estimated emissions of gas boilers versus heat pumps across different countries.
The biggest savings are in countries with a low-carbon electricity mix – like Canada. There, heat pumps cut emissions by around four-fifths. But even in countries with a carbon-intensive electricity mix, like China, the savings are large. This is still true for poorly designed heat pumps that ‘leak’ small amounts of powerful greenhouse gases [most don’t].
The key point to remember here is that the savings of heat pumps will continue to grow as countries decarbonise their electricity grids. The UK, for example, will need to reach zero-emissions electricity by 2035: at this point, its savings will also be close to 100%.
Gas-fired boilers are completely incompatible with a net-zero emissions pathway. Heat pumps are central to it. It’s the easiest and most obvious way to decarbonise our heating.
Heat pumps are much more efficient than hydrogen
Many have challenged the push for heat pumps from governments across the world. The answer, instead, is to go for ‘green hydrogen’.
But, hydrogen would need a lot more electricity than heat pumps to run.
In the chart below we see why. Let’s imagine we want to produce 100 gigawatt-hours (GWh) of heating.
To get this from heat pumps you need to produce 35 GWh of renewable electricity. 5% – which is 2 GWh – would be lost in transmission, leaving us with 33 GWh. As we now know, you get 3 to 4 units of heat out for every unit of electricity you put in. The rest comes from pulling ambient air into the pump. That means our 33 GWh is transformed into 100 GWh.
Now to get this from hydrogen, you need 182 GWh. That’s because the losses at various stages of the process are so large. Almost a third is lost in converting the electricity to green hydrogen. Then a quarter is lost in compressing it. Then another 10% is lost in the boiler.
When it comes to heat pumps versus hydrogen for heating, it’s a no-brainer. Hydrogen systems would need almost six times as much electricity.
The rollout of heat pumps: how is it going?
If heat pumps are the answer, how quickly are they being rolled out?
In the chart below we see the number of new heat pumps installed in Europe per 1,000 households in 2022. Here’s a similar chart of the number of heat pumps sold per million people.
You can see that there are massive differences in their uptake across Europe. At the top, we have the Scandinavian countries – which goes again the common myth that heat pumps don’t work in cold climates. They are adopting them at 20 to 40 times the rate of the UK. It sits at the bottom, installing just 2 pumps for every 1,000 homes. At this rate, it’d take 500 years for every home in the UK to have one installed.
Up-front costs for heat pumps are the biggest barrier to adoption
If heat pumps are so great, why is uptake so low?
The biggest barrier is up-front cost. Let’s take a look at how the cost of a heat pump stacks up: I’m going to focus on the UK here, where uptake is among the lowest.
The average air-source heat pump itself costs around £5,000. But installation, and retrofitting the heating system in your home will bump up the price quite a bit. The average cost when we factor in the full installation is around £10,000, but it can be higher in households that need a substantial amount of work done.
This is more expensive than a gas boiler, which costs around £3,000.
Now, the UK – like many other countries (which we’ll come to soon) – offers grants for heat pump installations. For air-source pumps, households can get a £5,000 grant in England and Wales, and up to £7,500 in Scotland.
So if you had the average heat pump installation cost of around £10,000, it’d cost £5,000 in England or £2,500 in Scotland, after receiving the grant payment. In Scotland you’d be paying the equivalent of a gas boiler anyway; in England, you’d probably have to fork out a few thousand pounds more.
If you’re unlucky and live in a house where heat pump costs can be up to £15,000 then up-front costs are going to start to be a problem. Even with a £5,000 grant in England, you’d still be paying £10,000.
The situation varies a lot, then: some households could pay about the same as a gas boiler when the government grant is included. Others could be paying up to £10,000 (maybe more).
Here I’ve been focusing on the UK, but other countries also provide grants for heat pump installations. Some are more generous than the UK. The European Heat Pump Association tracks subsidies across Europe here.
What about running costs? Are heat pumps more expensive to run?
The running costs of heat pumps and gas boilers are similar
Gas boilers run on gas (obviously) and heat pumps on electricity. So the balance of running costs hinges on the difference in the cost of electricity compared to gas.
How the relative prices between heat pumps and gas boilers tip, depends on the country and its pricing systems and on how different energy markets are changing.
Electricity tends to be more expensive than gas. That’s why standard electric heating is incredibly expensive. But remember that heat pumps are around four times as efficient as a gas boiler, so you need far fewer megawatt-hours to run one.
A general rule-of-thumb is that if the price of electricity is less than 3.2-times the cost of gas, it’ll likely be cheaper to run. This is the case for most well-installed heat pumps.
In its Future of Heat Pumps report, the IEA noted that the average household in the US, Europe, Korea, and Japan reduced their heating costs by switching to a heat pump in 2021 and 2022. The saving was in the order of a few hundred US dollars. In Europe, the saving was much larger, following a big jump in natural gas prices.
In the UK, in 2022, it was estimated that the average household with a heat pump would reduce their bills by around one-fifth compared to a gas boiler. That was when both electricity and gas prices were high (although gas prices had increased slightly more).
While heat pumps can be cheaper to run, the cost savings are often pretty small. And they are particularly sensitive to the price of gas.
The costs of installing and running heat pumps can fall
If the uptake of heat pumps is to be more attractive to households, they need to be cheaper to buy and run. There are reasons to believe that they could.
First of all, like many technologies, there is a lot of room for improvement – and those lead to cost reductions. Take electric cars. Or solar panels, or wind turbines. Their costs have plummeted as more and more people have adopted them. There is no reason to believe that heat pumps can’t also improve through further innovation and scalability.
The cost of heat pump installations in five years will be lower than it is today.
Second, some proposed energy market reforms could go in favour of heat pumps. In the UK, carbon taxes and levies are mostly applied to electricity. Oil and gas go mostly untouched. Their prices are also pegged to the most expensive source in the mix at any given time – called ‘marginal pricing’ – which is often natural gas. That means electricity prices have hiked just like gas prices have, despite a lot of the UK’s electricity being produced more cheaply from renewables.
Both of these factors affect the relative pricing of electricity and gas, making heat pumps more expensive to run. If these markets were reformed – as the government is considering – electricity prices would fall.
Many countries are far behind their targets. The UK has committed to installing 600,000 heat pumps per year by 2028. It’s currently installing less than 60,000. It needs to increase its installation rates more than ten-fold in the next five years. And it’s not going to do that without a change in cost for consumers, especially when it comes to up-front costs.