Commercial Heat Pump vs Gas Boiler — the Honest Running-Cost Comparison

Every facilities manager weighing up plant replacement eventually reaches the same fork in the road: replace the ageing gas boilers like for like, or electrify the heat with a commercial heat pump. It is one of the most consequential capital decisions in a building’s life, and it is surrounded by more noise than almost any other question in commercial HVAC. This guide compares the two honestly — the running-cost maths, the seasonal efficiency that decides it, the compliance drivers pushing the decision, and the situations where a gas boiler is still the right call.

Key takeaway upfront

There is no universal winner. A heat pump at a genuinely good seasonal efficiency (SCOP) is roughly cost-neutral to slightly cheaper to run than a modern gas boiler at today’s energy prices, and it removes on-site combustion so it clears the direction the regulations are heading. A heat pump on a poorly prepared building — high flow temperatures, no ventilation heat recovery, a marginal tariff — can cost more to run than the gas boilers it replaced. The honest answer is that the maths must be modelled from your building’s real consumption, not assumed from a brochure.

In this guide

• The one number that decides it: SCOP
• The running-cost maths, step by step
• Where the gas boiler still wins
• Where the heat pump wins
• The compliance driver you cannot ignore
• Capital cost and funding
• The hybrid middle ground
• How to decide for your building
• Frequently asked questions

The one number that decides it: SCOP {#scop}

A gas boiler is, at best, a little over 90% efficient — burn a unit of gas, get a bit less than a unit of heat. A heat pump does something different: it moves heat rather than making it, so for every unit of electricity it draws it delivers several units of heat. That multiplier, measured across a whole heating season rather than at a single test point, is the Seasonal Coefficient of Performance, or SCOP.

Commercial air-source and water-source heat pumps typically achieve an SCOP of 2.8 to 4.0. At the top of that range a unit of electricity delivers four units of heat; at the bottom it delivers under three. That spread is the whole ballgame, because it is what has to offset the price gap between electricity and gas. SCOP is defined and measured to BS EN 14825, so a properly quoted heat pump gives you a figure you can compare across suppliers — insist on it.

Three design decisions move the SCOP more than the choice of manufacturer:

• Flow temperature. A heat pump asked to deliver water at 45–55°C is far more efficient than one pushed to 70°C to suit old radiators. Lowering flow temperature — by upgrading emitters, adding underfloor circuits, or oversizing fan-coils — is the single biggest lever on running cost.
• Ventilation heat recovery. Every cubic metre of fresh air a building brings in carries a heating penalty. Recover that heat with an MVHR unit or a heat-recovery air handling unit and the heat pump has less work to do. This is why commercial ventilation and MVHR is not a separate project from electrification — it is what makes electrification pay.
• Sizing and control. A heat pump spends most of its hours well below peak load, so part-load efficiency and good controls matter more than headline capacity.

The running-cost maths, step by step {#running-cost}

Start with the honest fulcrum. On 2026 energy prices, commercial electricity sits at roughly 24–25p per kWh and gas at roughly 6–7p per kWh — a ratio of about four to one. That gap is what makes people assume electrification must cost more. The SCOP is what closes it.

Take a gas boiler at 90% efficiency burning gas at 7p/kWh. A unit of useful heat costs about 7.8p (7p divided by 0.90). Now take a heat pump at an SCOP of 3.5 drawing electricity at 25p/kWh. A unit of useful heat costs about 7.1p (25p divided by 3.5). On those figures the heat pump is marginally cheaper — roughly level to around 10% less — for the same heat delivered.

Move the SCOP and the picture changes fast. At an SCOP of 3.0 the heat pump’s useful heat costs about 8.3p — slightly more than the gas boiler. At an SCOP of 4.0 it costs about 6.3p — clearly less. This is exactly why an honest specialist refuses to promise a saving without modelling: the answer swings from “cheaper” to “dearer” across the normal SCOP range, and the building’s flow temperature and heat recovery are what put you at one end or the other.

Two further factors tilt the long-term maths toward the heat pump. The Climate Change Levy adds cost to both fuels — the main rate from 1 April 2026 is 0.801p/kWh — but as the grid continues to decarbonise, electricity’s carbon (and increasingly its cost trajectory relative to gas) improves. And a heat pump can run in reverse to provide cooling, so in a mixed office it can replace two systems with one. Always confirm the current levy rate on gov.uk, as it is reviewed at each fiscal event.

Callout — the take-your-own-advice rule. We will not quote a running-cost saving for your building without modelling it from your real half-hourly consumption. Any supplier who promises a fixed percentage saving before seeing your data is guessing.

Where the gas boiler still wins {#gas-wins}

Honesty cuts both ways. A gas boiler remains the sensible choice in several situations:

• Very high flow-temperature demand that cannot be lowered. Some process heat and some older buildings genuinely need 70–80°C water and cannot economically be adapted. A heat pump’s SCOP collapses at those temperatures.
• Constrained electrical supply. A large heat pump adds significant electrical load, and where the site is near its supply capacity a DNO upgrade can be needed — often the longest-lead and most expensive item in the whole project. If the supply upgrade is prohibitive, staged electrification or a hybrid is more realistic than a full switch.
• Low, intermittent heating demand. A building heated only occasionally may never accumulate the running-cost savings to justify the higher capital of a heat pump.
• Immediate like-for-like replacement on a failed boiler with no budget for the wider works. Sometimes the honest short-term answer is to replace the boiler and plan the electrification properly for the next capital cycle.

Where the heat pump wins {#heat-pump-wins}

• Buildings that also need cooling. Reversible and heat-recovery heat pumps heat and cool from one plant set. In a mixed office where the south face needs cooling while the north needs heat, a heat-recovery system moves heat between zones — the efficiency prize a gas boiler cannot touch.
• Well-insulated, low-flow-temperature buildings. Modern or upgraded stock with underfloor heating or oversized emitters lets the heat pump run at its best SCOP.
• Any building with a net-zero target or ESG reporting duty. A heat pump removes on-site combustion entirely — the credible route to decarbonised heat.
• Larger let buildings facing MEES. More on this below, but electrified heat lifts the modelled energy performance that sets a commercial EPC.

Our sub-vertical page on commercial heat pumps for buildings covers the electrification step in more depth, and for the heat-pump-only story our sibling site runs a dedicated commercial heat-pump resource worth reading alongside this comparison.

The compliance driver you cannot ignore {#compliance}

Running cost is not the only pressure. The Minimum Energy Efficiency Standard (MEES) already makes it unlawful to continue letting commercial space below EPC E — that has applied to continuing lets since 1 April 2023, not just new lets. The government has proposed that privately rented non-domestic buildings over 1,000 sqm reach EPC B by 2031, subject to secondary legislation (the earlier floated interim EPC C milestone for 2027 was dropped). Confirm the current position on gov.uk, as the proposal is still moving through consultation.

Heating and cooling dominate a commercial building’s modelled energy use, so HVAC is usually the most effective lever on the EPC. Electrified low-carbon heat, ventilation heat recovery and better controls all lift the rating. For a larger let building, the heat-pump-versus-boiler decision is therefore also a lettability decision — our guide to MEES and commercial HVAC works through what that means in practice. For the EPC assessment itself, that intent is best served elsewhere; we treat MEES as a driver for HVAC upgrades rather than an assessment service.

Capital cost and funding {#capital}

Commercial heat-pump heating typically runs £60,000–£600,000 installed depending on capacity, emitter works and any electrical supply upgrade, against a lower up-front figure for a like-for-like gas boiler replacement. The gap narrows when you account for the heat pump also providing cooling and for the funding routes available.

There is no commercial equivalent of the domestic £7,500 Boiler Upgrade Scheme — that scheme is residential only, and any site that implies otherwise is misleading you. Commercial HVAC is funded through the tax system instead: full expensing gives companies a 100% first-year deduction on qualifying new plant (made permanent from April 2026), the £1m Annual Investment Allowance covers other businesses, and a new 40% first-year allowance applies from 1 January 2026. Confirm the current rates on gov.uk. Our grants and funding page and our guide on how to fund a commercial HVAC upgrade map the routes that genuinely apply. For the honest cost ranges by system, see our cost guide.

The hybrid middle ground {#hybrid}

The decision is not always binary. A hybrid keeps a smaller gas boiler for the coldest peaks while a heat pump does the bulk of the annual heating at its best efficiency. This trims the electrical supply requirement (the heat pump is sized for base load, not peak), keeps a resilient back-up, and captures most of the carbon and running-cost benefit. For many existing buildings — especially those with a constrained supply or a phased capital budget — a hybrid or a staged switch is the pragmatic route rather than an all-at-once rip-out.

How to decide for your building {#decide}

Work through these in order:

1. Get your real consumption. Pull half-hourly meter data — the model is only as good as its inputs.
2. Establish the flow temperature you actually need, and whether emitter upgrades can lower it.
3. Check the electrical supply capacity early. If a DNO upgrade is likely, get that conversation started at feasibility.
4. Model the SCOP honestly to BS EN 14825, and price ventilation heat recovery in — it is what lifts the SCOP.
5. Overlay the compliance and carbon drivers (MEES, ESG targets) that may weigh alongside pure running cost.
6. Compare whole-life cost, not just the capital or just the first year.

A specialist who understands plant rooms, refrigerant law and running-cost maths will give you that comparison as numbers, not a sales pitch — including telling you when the gas boiler is still the right answer. When you are ready, request a free desk feasibility and we will model it from your data.

Frequently asked questions {#faqs}

Will a heat pump definitely cost more to run than our gas boilers?

Not necessarily. At an SCOP of around 3.5 a heat pump delivers heat at roughly the same cost as a modern gas boiler today, sometimes a little less, despite electricity costing about four times as much as gas per unit. Below an SCOP of about 3.0 it can cost more. The flow temperature, ventilation heat recovery and tariff decide which side of the line you land on, which is why it should be modelled from your real data rather than assumed.

Do I have to replace all my gas boilers at once?

No. A hybrid arrangement keeps a smaller gas boiler for peak cold days while the heat pump handles the bulk of the heating at its most efficient. This reduces the electrical supply requirement and the capital hit, and suits buildings with a constrained supply or a phased budget. Staged electrification — heat pump now, remaining boilers retired at the next capital cycle — is common and sensible.

Is there a grant to switch from a gas boiler to a heat pump commercially?

There is no commercial version of the £7,500 Boiler Upgrade Scheme; that is domestic only. Commercial electrification is funded through full expensing (100% first-year deduction for companies, permanent from April 2026), the £1m Annual Investment Allowance, and the new 40% first-year allowance from 1 January 2026. Eligible energy-intensive industrial sites could historically use the Industrial Energy Transformation Fund, though its windows are winding down. Confirm current status on gov.uk.

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Authoritative references: the government’s capital allowances and full expensing guidance, the Climate Change Levy rates on GOV.UK, and CIBSE for commercial heat-pump and low-temperature heating design.