5 Factors That Affect Heat Pump Running Costs

Summary

Running costs vary by 50%+ between well-optimized and poorly-optimized systems. The biggest factors are flow temperature, insulation quality, thermostat settings, heat pump sizing, and electricity tariff choice.

1. Flow temperature (biggest impact)

Flow temperature is how hot the water leaving your heat pump is. Lower flow temperatures mean higher efficiency (SCOP). A system running at 35°C flow can achieve SCOP 4.0. The same pump at 55°C drops to SCOP 2.5, increasing costs by 60%.

To run low flow temps, you need larger radiators or underfloor heating. Many UK homes have radiators sized for gas boilers (60-70°C flow). Replacing with larger radiators or adding extra panels allows 35-45°C flow, dramatically cutting costs.

2. Insulation quality

Better insulation reduces total heat demand, so you use less electricity regardless of SCOP. Loft insulation (270mm+), cavity wall fill, and double glazing can halve heat loss compared to uninsulated homes. This cuts running costs directly. Insulation also allows lower flow temps (factor 1), compounding the benefit.

3. Thermostat settings and usage patterns

Heat pumps work best when left on at a constant low temperature (18-20°C), not blasted to 24°C for short bursts. Every 1°C rise in target temperature adds ~8% to running costs. Running the pump overnight on cheap-rate electricity (if on a time-of-use tariff) and coasting through peak hours can save 20-30%.

4. Heat pump sizing (see separate guide)

Correctly sized pumps run continuously at high efficiency. Oversized pumps cycle on/off, reducing SCOP and wasting the higher capital cost. If your pump short-cycles (runs for 10 minutes then stops), it is oversized for your actual heat loss. This is common when installers copy old boiler sizes. See our sizing guide for more.

5. Electricity tariff (see tariff guide)

Standard variable tariffs charge ~28p/kWh. Time-of-use tariffs (Octopus Cosy, British Gas EV/HP) offer 12-14p/kWh overnight but 30p+ at peak. If you can shift 60%+ of heating to off-peak, you save money. If not, you can pay more than a flat tariff. Tariff choice depends on your insulation (can you store heat overnight?) and hot water tank size. See tariff comparison.

Other factors (smaller impact)

Outdoor temperature: Colder winters reduce SCOP slightly. Scotland averages 5-10% higher costs than southern England.
Hot water demand: Heating water to 50-55°C is less efficient than space heating. Large families use more hot water, increasing costs.
Heat pump brand/model: Top brands (Mitsubishi, Daikin, Vaillant) perform ~10% better than budget models in field trials.

Optimizing your system

If your heat pump costs more than expected, check flow temperature first (ask your installer to measure it). Lowering from 50°C to 40°C can save £200+/year on a typical home. Next, upgrade insulation if your home is pre-1990s with no cavity wall fill or loft insulation. Finally, consider a time-of-use tariff if you have a large hot water tank and good insulation.

Sources

Carbon Trust, Heat Pump Field Trials: Phase 2, 2023
Energy Saving Trust, Optimizing heat pump efficiency, 2025
Nesta, Electrification of Heat Demonstration Project, 2024

Calculate your costs: Try the heat pump cost calculator to see how SCOP and tariff affect your bill.