Storage Heaters vs Heat Pump: Is It Worth Switching?
The short answer
- £690 to £1,440 a year saved on a heat pump tariff in the four example homes
- £1,752 a year for storage heaters in a 3-bed semi, against £666 for a heat pump on a heat pump tariff
- About 3 to 8 years to pay back after the £7,500 grant in a 3-bed semi, before any radiator and pipework costs
Replacing storage heaters with a heat pump saves £690 to £1,440 a year on a heat pump tariff in the four homes below. Storage heaters turn each unit of electricity into one unit of heat, mostly using cheaper night electricity. A heat pump delivers 2.55 to 3.05 units of heat for every unit of electricity in the middle half of homes measured in the Electrification of Heat trial, so each unit of heat costs about 47% less on a standard tariff and 60% less on a heat pump tariff. With the £7,500 Boiler Upgrade Scheme grant, the heat pump itself pays back in about 3 to 8 years in a 3-bed semi, before any new radiators and pipework.
How much cheaper is a heat pump to run?
£1,752 a year for storage heaters in a 3-bed semi, against £666 for a heat pump on a heat pump tariff. Across the four example homes, the heat pump tariff saves £691 to £1,441 a year.
Read the detail
| Property type | Storage heaters | Heat pump (standard) | Heat pump (HP tariff) | Saving on a heat pump tariff |
|---|---|---|---|---|
| 2-bed flat | £1,131 | £605 | £430 | £701 |
| 2-bed terrace | £1,115 | £596 | £424 | £691 |
| 3-bed semi | £1,752 | £937 | £666 | £1,086 |
| 4-bed detached | £2,325 | £1,244 | £884 | £1,441 |
The data behind this table
Storage heaters on Economy 7 at Octopus Energy's published rates moved in line with the October 2026 price cap: about 14.0p/kWh at night and 32.3p/kWh by day. We assume 80% of the heat comes from the overnight charge and 20% from daytime top-up, which gives an average of 17.7p per kWh of heat. Heat pump at the measured median efficiency of 2.78, at 26.32p/kWh standard or 18.7p/kWh on a heat pump tariff such as Cosy Octopus with most heating in the cheap hours, Ofgem price cap for October to December 2026. Average insulation, heat demand 6,390 kWh for the 2-bed flat, 6,300 kWh for the 2-bed terrace, 9,900 kWh for the 3-bed semi and 13,140 kWh for the 4-bed detached, from the shared model behind our calculators. Electric heating counted at 100% efficiency. Standing charges are left out.
Use our boiler vs heat pump calculator for your specific property.
Why do storage heaters cost so much?
They turn each unit of electricity into one unit of heat, while a heat pump gave 2.55 to 3.05. Daytime top-up costs about 32p/kWh on Economy 7, and you set each night's charge by guessing tomorrow's weather.
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Storage heaters charge overnight on a cheaper night-rate tariff (Economy 7 or Economy 10) and release heat during the day. That keeps their cost below direct electric heating, but several things still make them expensive:
They are only 100% efficient. Every 1 kWh of electricity produces 1 kWh of heat. A heat pump produced 2.55 to 3.05 kWh of heat per 1 kWh of electricity in the middle half of homes in the Electrification of Heat trial, so storage heaters use roughly two and a half to three times as much electricity for the same heat.
Daytime top-up is expensive. Many homes with storage heaters need extra heat in the late afternoon and evening when the stored heat runs out. On Economy 7 that top-up is charged at the day rate, about 32p/kWh on Octopus's rates, which is higher than the 26.32p single rate.
Poor control. You set the input the night before based on guessing tomorrow's weather. If it is warmer than expected, you waste energy. If it is colder, you need expensive daytime top-up. A heat pump adjusts in real time.
What does the switch involve?
A heat pump plus radiators, pipework and a hot water cylinder if the home has none. The heat pump costs £3,500 to £8,000 after the grant, with radiator and pipework work priced separately.
| Cost element | Range |
|---|---|
| Air source heat pump, 3-bed semi | £11,000 to £15,500 |
| Boiler Upgrade Scheme grant | -£7,500 |
| Heat pump after the grant | £3,500 to £8,000 |
| Radiators, pipework and a hot water cylinder | Priced by the installer if not already in the quote |
| Total out of pocket | £3,500 to £8,000, plus any radiator and pipework work priced separately |
Read the detail
Replacing storage heaters with a heat pump means installing a wet central heating system (radiators and pipework) if you do not already have one, and a hot water cylinder. This is the biggest difference from replacing a gas boiler, where the pipework already exists.
The data behind this table
The heat pump range is the middle half of what installers reported for a heat pump of about 9 kW under the Boiler Upgrade Scheme in 2025/26, covering the system, labour and VAT as they recorded it. A home with no radiators needs a full set plus pipework, which costs more than the radiator changes in a gas boiler swap, so ask for it to be itemised in each quote.
At £1,086 a year saved (3-bed semi on a heat pump tariff), the heat pump pays back its £3,500 to £8,000 after the grant in about 3 to 7 years, or 4.8 years at the typical cost of £5,200. Every £1,000 of radiator and pipework work adds about 11 months.
Check for free funding first
If you are on a low income or certain benefits, ECO4 may help pay for the switch until it closes on 31 December 2026. In England, the Warm Homes: Local Grant, which replaced the Home Upgrade Grant, lets your council pay for agreed work, including air source heat pumps, in privately owned homes with an EPC of D to G where household income is usually £36,000 or less. Use our grant eligibility checker.
When should you keep storage heaters?
In a small, well-insulated flat with no outdoor space, or when you rent. There, modern high heat retention storage heaters may be the practical choice, at £900 to £1,400 per room fitted.
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Small, well-insulated flat with no outdoor space. If you cannot fit a heat pump outdoor unit and your heating costs are low, modern high heat retention storage heaters, which hold their charge for longer, may be the practical choice. The Energy Saving Trust puts new storage heaters at £900 to £1,400 per room fitted. If your heaters are switched by a Radio Teleswitch (RTS) meter, that system is being phased out, so ask your supplier about a replacement meter.
You are renting. The landlord would need to fund the installation, and the grant goes to the owner. You can ask, but cannot force the change. The government has confirmed new minimum energy efficiency standards that privately rented homes must meet by 2030; see our guide to EPC minimum standards for landlords.
For most homes with outdoor space, the bigger the storage heater bill, the faster the payback: in our model, every £1,000 a year spent on storage heaters becomes about £380 on a heat pump tariff.
Frequently asked questions
How much does it cost to replace storage heaters with a heat pump?
For a 3-bed semi, the heat pump costs £11,000 to £15,500 installed, or £3,500 to £8,000 after the £7,500 Boiler Upgrade Scheme grant. A home with storage heaters also needs radiators, pipework and a hot water cylinder, so ask for those to be itemised in each quote.
How much will I save?
About £690 to £1,440 a year on a heat pump tariff in our four example homes, and about £520 to £1,080 on a standard tariff. For a 3-bed semi the heat pump pays back in about 3 to 7 years after the grant, before any radiator work. See our running costs guide.
Can I get the switch for free?
Possibly. ECO4 may help until it closes on 31 December 2026, and in England the Warm Homes: Local Grant, which replaced the Home Upgrade Grant, pays for agreed work for eligible households through your council. Use our grant checker.
Data sources
Standard rates come from the Ofgem price cap and Economy 7 rates from Octopus Energy's public price feed, with efficiency from the Electrification of Heat trial and installed costs from DESNZ Boiler Upgrade Scheme statistics.
Show every source
Standard rates from the Ofgem price cap, October to December 2026. Economy 7 rates from the Octopus Energy public price feed (Flexible Octopus, 25 September 2026). Heat demand from our own model, fitted to DESNZ National Energy Efficiency Data-Framework data. Heat pump efficiency from the Electrification of Heat trial. Installed costs from DESNZ Boiler Upgrade Scheme statistics, August 2026. Grant rules from GOV.UK: Boiler Upgrade Scheme and Warm Homes: Local Grant. Storage heater costs and RTS switch-off from the Energy Saving Trust (page updated 1 July 2026). Rental standards from the Warm Homes Plan.