How much do commercial heat pumps cost?
Published UK price bands for commercial air-source and ground-source heat pumps, what moves the number, and how to compare quotes like for like.
Published installed-cost bands
There is no official UK price list for commercial heat pumps, and installed cost varies with the building. The only way to give a sense of scale is to show what published installer guides say, and to be clear that they are guides. The table repeats the bands in one such guide (Fuse Energy, “Commercial heat pump costs”, updated 8 July 2026). The bands overlap and are not mutually consistent, which is itself a warning: two buildings of the same output can cost very different amounts.
| System | Thermal output | Published installed band |
|---|---|---|
| Air-source | 100 kW | £55,000 - £95,000 |
| Air-source | 200-500 kW | £80,000 - £250,000 |
| Air-source | 500 kW+ | £210,000 - £380,000 |
| Ground-source | 100 kW | £90,000 - £160,000 |
| Ground-source | 200-500 kW | £120,000 - £600,000 |
| Ground-source | 500 kW+ | £360,000 - £640,000 |
| High-temperature industrial | varies | £150,000 - £500,000+ |
The same guide says the price covers the heat pump units, new controls, buffer vessels, and the electrical upgrades or building-management integration needed, and that annual servicing typically starts from around £250 plus VAT. Treat all of this as a planning range to test against real written quotes.
What drives the price up or down
- Heat load, not floor area. The output you need comes from the building’s peak heat loss and annual demand. Two 1,000 m² buildings can need very different plant.
- Flow temperature and emitters. Lower flow temperatures raise the seasonal efficiency (SCOP), but radiators, fan coils or pipework designed for hot gas-boiler water may need upgrading to run cooler. A hybrid design that keeps the boiler for the coldest days can avoid some of that work — see hybrid and boiler-replacement retrofit.
- Air-source or ground-source. Ground-source adds boreholes or ground loops and the drilling that goes with them, which is why its published bands sit higher. See the ground-source guide.
- Electrical supply. A heat pump adds electrical load. If your site’s connection cannot take it, a network upgrade from your distribution network operator (DNO) can add cost and lead time. Ask early.
- Plant location. A roof lift, a ground-level compound, a plant room conversion, acoustic screening and planning conditions all change the number.
- Hot water. Heating a large hot-water load to storage temperatures can need a dedicated high-temperature or two-stage design.
The one published installer guide cited on this page puts ground-source above air-source at 100 kW thermal; the comparison of air and ground source systems explains what drives that gap and when it pays back.
Running cost is a separate question from capital cost
Cost per kWh of heat is the energy price divided by efficiency. For a heat pump that efficiency is the SCOP; for a gas boiler it is the boiler’s seasonal efficiency, which you can assume at 85-90% for modern plant. DESNZ’s Quarterly Energy Prices (September 2026 edition, published 29 September 2026) report all-non-domestic average prices for Q2 2026 of 24.51p per kWh for electricity and 5.28p per kWh for gas (excluding VAT). These are averages across all non-domestic users, not a quote for any one site.
At those average prices and an 88% boiler efficiency, gas heat costs about 5.28 ÷ 0.88 = 6.0p per kWh of heat. A heat pump delivering heat at the same cost would need a SCOP of 24.51 ÷ 6.0 = about 4.1. The installer guide cited above uses a COP of 3.2 for an air-source example, well below that, so at these national averages a heat pump would not beat gas on unit energy cost alone. Cheaper electricity (a negotiated or time-of-use tariff, on-site generation), higher gas prices, cooling from a reversible unit, or carbon and policy drivers change the answer. One published installer guide uses a different gas assumption and reports a COP 3.2 system at 24p per kWh producing heat at roughly 7.5p per kWh against 7-8p for a gas boiler.
The honest conclusion is that you should run your own numbers. The running-cost calculator does the same arithmetic with your tariffs, your heat demand and a SCOP you choose, and shows the break-even SCOP.
The earlier DESNZ edition (June 2026, provisional Q1 2026 data for medium-sized businesses: 25.0p per kWh electricity, 4.55p gas) gave a break-even SCOP of about 4.8. That is a different quarter and a different customer band, so it is not a like-for-like trend. National averages hide a wide spread, so use your own bills. For the wider question of whether the numbers add up for a business, see are heat pumps worth it for a business.
Grants and tax relief that change the net cost
Boiler Upgrade Scheme. GOV.UK says the grant can be used to replace a heating system “in your home or a building used for your business”. In England and Wales, owners of small non-domestic buildings may qualify where the heat pump is 45 kW thermal or less for a single heat pump (70 kW thermal for a multi-unit system), the building is replacing a fossil-fuel or direct-electric system, and the application is made by an MCS-certified installer. The grant is £7,500, or £9,000 where the property is off the gas grid and replacing oil or LPG (21 July 2026 to 31 March 2027). Larger systems fall outside it, and most commercial projects are larger, so for most sites the net cost is the installed price less capital allowances, not less a grant. See the grants and funding guide for what is open, what has closed and the other ways to pay.
Capital allowances. A heating system is an integral feature of a building, which makes it special-rate expenditure. That means full expensing does not apply. The Annual Investment Allowance gives 100% relief up to £1m a year, and companies can claim a 50% first-year allowance on special-rate plant above that. Confirm how your accountant classifies the specific works. The tax saved is your corporation tax rate times the relief, so it is not a flat “25p in the pound”.
If the building is in Scotland, Wales or Northern Ireland
Installed prices do not change at the border, but the funding that reduces them does.
- Scotland: no Boiler Upgrade Scheme. The Business Energy Scotland SME Loan is interest-free and pays cashback of 75% of eligible heat pump costs up to £10,000, so on a loan-funded project it is the cashback, not a grant, that cuts the net cost. Arithmetic only: on £40,000 of eligible heat pump costs, 75% would be £30,000, so the £10,000 cap is what you would get.
- Wales: the Boiler Upgrade Scheme applies as in England. For larger projects the Development Bank of Wales Green Business Loan Scheme names heat pumps among the measures it funds; it spreads the cost rather than reducing it.
- Northern Ireland: no Boiler Upgrade Scheme, Invest NI’s Energy Efficiency Capital Grant is paused, and Power NI’s NISEP commercial scheme has closed for applications for 2026/27 (its list did not include heat pumps). Budget on the full installed price.
Capital allowances work the same way in all four nations. A business pays VAT at 20% on the installation, reclaimable if VAT-registered; the 0% rate is limited to residential and solely charitable buildings. Sources are in the grants and funding guide.
How to compare quotes like for like
- Ask each installer for the design heat load in kW and how it was calculated, and for the assumed flow temperature.
- Ask for the seasonal efficiency (SCOP) to BS EN 14825 and the conditions it was quoted under, not a headline COP.
- Check what is excluded: emitter upgrades, electrical supply upgrade, planning or noise assessment, controls and metering, commissioning and the first service.
- Ask for MCS and other credentials and check them on the public registers rather than on the quote.
- Get at least two written quotes against the same specification.