Heat pumps could play a crucial role in helping achieve net zero-carbon homes by moving consumers away from traditional heating like gas boilers to a more carbon-saving technology. With heat pumps working from electricity and the price of electricity being around 4 times more expensive than mains gas, it’s even more important to make sure the economics make sense for the general public if they are to transition to heat pumps.
Why is there a need for a specific tariff for Heat Pumps?
As heat pumps work off electricity, having a single tariff which covers all your electricity needs in your home may not work for people who want a heat pump. The annual electricity consumption of a heat pump could be more than 5,000 kWh – many people’s general electricity consumption for the year will be less than 5,000 kWh. Therefore, a consumer who is replacing a gas boiler, for example, with a heat pump could double their electricity bills and consumption. The traditional single priced electricity tariff doesn’t accommodate for technologies such as heat pumps.
What are the benefits of having a Heat Pump tariff?
- Make the running costs more affordable
- Flexibility of unit rates at different times of the day
- Help increase the deployment of heat pumps in homes
What type of tariffs are available at the moment?
At present Good Energy have announced that they are developing a heat pump tariff to coincide with the launch of the Green Homes Grant Scheme. They promise cheaper rates at certain periods during the day, while the national grid is experiencing lower demand.
Good Energy state their heat pump tariff will offer homeowners:
- Competitive unit rates to benefit heat pump users with higher electricity consumption
- Cheaper unit rates at specific times of the day, allowing customers to use their heat pumps more cost-effectively during key periods
What does the future hold for heat pumps?
Heat pumps could play an important role in helping balance the grid. When there is an overload, heat pumps could be turned on to help take some of the excess supply of electricity. Heat pumps need to be smart to take advantage of future potential of income and savings. A heat pump could become an asset for the homeowner, whereby it earns them an annual income through an energy provider or energy aggregator.
