Tag Archives: electricity-market

All the talk of the ‘spark gap’ – the particularly high ratio of electricity unit prices to gas unit prices – might deter people from getting a heat pump, because they think it will mean they will pay more for their heating than they do currently, but this is false in the majority of situations where householders are end-of-lifeing their old gas boiler.

Let’s run the numbers.

• Take a building that currently that consumes 30,000 kWh of gas for heating per year.
• At a gas unit price of 6p/kWh that totals £1,800 per year (for the moment, ignoring standing charges for simplicity)
• Let’s assume the old gas boiler is 75% efficient (in many cases with will be quite optimistic).
• So, building actually needs 22,500 kWh of heat reaching radiators (0.75 x 30,000 = 22,500).

So the question is, can a heat pump be cheaper to run with its high relative performance that counteracts the ‘spark gap’? Let’s see …

• Let’s assume a reasonable minimum achievable heat pump system SCOP of 3.5
• So heat pump needs 6,429 kWh of electricity to produce 22,500 kWh of heat ((22,500 / 3.5) = 6,429)
• At a electricity unit price of 22p/kWh that totals £1,414 per year 
• That is a saving of £386 on running costs

Health Warning: The difference is very sensitive to the ‘spark gap’ (ratio of electricity to gas unit prices), and crucially the SCOP. 

Now, I am not saying there is not an issue with the ‘spark gap’. Adoption rates in Europe show that the smaller the spark gap, the high the adoption of heat pumps (see ‘Figure 2.4 Comparison between the heat pump market share, the number of heat pumps installed, and electricity and gas price ratio for countries in Europe in 2023’, Progress in reducing emissions – 2025 report to Parliament, 25 June 2025).

However, when people talk about the spark gap they seem to assume the context is ‘buy a new gas boiler or buy a heat pump’. Needless to say that is a higher bar but not an insurmountable one. Many people who are concerned about climate change and have an ageing gas boiler simply want to know that their heat bills will not rise.

Now back to standing charges. I rerun the numbers for different SCOPs and included standing charges (see NOTES for assumptions). The ‘breakeven’ SCOP is then close to 2.9, which frankly only an incompetent heat pump installer would fail to exceed.

And what is more, for any of these SCOPs the carbon saving is at least 4 tonnes of carbon dioxide equivalent per year. So both the planet and the bank balance can be happy with the choice.

So, let’s fix the spark gap, but stop banging on about it as though it is a reason not to press on with rolling out heat pumps.

(c) Richard W. Erskine, 2025

NOTES

Assumptions used in table: With heat demand of 22,500 kWh and old gas boiler with efficiency of 0.75 (75%), so gas bill showing 30,000 kWh primary energy used by gas boiler. Used standing charges of 28p and 59p per day for gas and electricity, and unit rates of 6p/kWh and 22p/kWh, respectively. The breakeven running costs SCOP in this case is 2.935. Also, a carbon intensity of gas of 184 gCO₂/kWh and for UK electricity grid (for 2024) of 124 gCO₂/kWh; so even at a SCOP of 2.5 you save 4.37 tonnes of CO₂ a year.