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Is a Heat Pump Cheaper to Run Than LPG?
Yes, an air source heat pump can be considerably cheaper to run than an LPG boiler. However, the actual saving depends on how much you pay for LPG, your existing boiler’s efficiency and the seasonal performance of the proposed heat pump.
- 14 min read
- Updated October 2026
- By Phil · Heat Loss Hub
For homeowners using bulk LPG, switching to a correctly designed heat pump can offer meaningful running-cost savings. But the difference isn’t the same for every household.
Someone paying 85p per litre for LPG faces a very different financial comparison from someone paying 50p.
The best way to establish the potential saving is to compare the cost of delivering the same amount of useful heat to your property.
QUICK ANSWER
In our illustrative example, a household using 2,000 litres of LPG annually at 72p per litre spends £1,440 on fuel. A heat pump supplying the same useful heating and hot water could cost approximately £1,039 in electricity, saving around £401 per year, or 28%, before tank charges, additional electrical inputs and installation costs.
The figures below explain how that comparison works and how to adapt it using your own LPG bills.
LPG vs Heat Pump — Cost per Useful kWh of Heat
Comparing 72p per litre of LPG with 26.32p per kWh of electricity doesn’t tell us which heating system is cheaper.
The fuels are sold in different units, and the equipment converts purchased energy into useful heat at different efficiencies.
An LPG boiler burns fuel to produce heat. Not all the fuel’s energy becomes useful heating because some is lost through the appliance and its operation.
A heat pump uses electricity to transfer heat from the outside air into your heating system. It can deliver several units of useful heat for each unit of electricity consumed.
For a meaningful comparison, we need to establish the cost per kilowatt-hour of useful heat delivered.
Consider the following illustrative figures.
| Heating system | Assumptions | Cost per useful kWh |
|---|---|---|
| Bulk LPG boiler | 72p/litre, 85% efficiency | 11.93p |
| Heat pump — space heating | Electricity 26.32p/kWh, efficiency 3.5 | 7.52p |
| Heat pump — hot water | Electricity 26.32p/kWh, efficiency 1.9 | 13.85p |
| Direct electric heating | Electricity 26.32p/kWh, 100% efficiency | 26.32p |
The LPG and efficiency figures are illustrative. The electricity rate is Ofgem’s average capped Direct Debit rate for October–December 2026 in Great Britain. The costs exclude fixed charges and any electricity outside the stated efficiency boundaries.
This comparison reveals something important.
A heat pump may produce space heating much more cheaply than an LPG boiler while its hot-water production operates at a lower efficiency.
That is why we should calculate space heating and hot water separately rather than apply one manufacturer’s space-heating SCOP to everything.
For the wider calculation methodology, see How Much Does a Heat Pump Cost to Run?
How Much Useful Heat Does a Litre of LPG Provide?
For an illustrative domestic propane calculation, we can use approximately 7.1 kWh of fuel energy per litre.
The amount of useful heating delivered depends on the boiler’s actual seasonal efficiency.
If we assume an LPG boiler operates at 85% efficiency:
7.1 kWh × 0.85 = 6.035 kWh of useful heat per litre
At a purchase price of 72p per litre:
72p ÷ 6.035 kWh = 11.93p per useful kWh
This is the important figure for comparing the existing LPG boiler with a proposed heat pump.
A more efficient boiler would produce more useful heat from the same fuel. An older or poorly performing system might produce less.
The energy content of LPG also varies with composition and whether gross or net calorific values are being used. Boiler efficiency and fuel-energy assumptions must be expressed on a consistent basis.
For a household calculation, these details should be stated rather than hidden inside a generic savings estimate.
Worked Example — Replacing an LPG Boiler with a Heat Pump
Let’s consider a hypothetical detached house currently heated by a bulk LPG boiler.
The homeowner uses 2,000 litres of LPG annually for space heating and domestic hot water.
We’ll assume all the recorded consumption serves those purposes, with no separate LPG cooking demand.
Existing LPG Heating Costs
| Calculation input | Assumption |
|---|---|
| Annual LPG consumption | 2,000 litres |
| LPG price | 72p/litre |
| Fuel energy content | 7.1 kWh/litre |
| Existing boiler efficiency | 85% |
| Annual useful heat | 12,070 kWh |
The LPG fuel cost is:
2,000 × £0.72 = £1,440 per year
The useful heat delivered is:
2,000 × 7.1 × 0.85 = 12,070 kWh annually
This establishes the useful heating energy that the replacement system needs to provide under the same annual-demand assumptions.
Estimated Heat Pump Electricity Consumption
Now consider a proposed air-to-water heat pump supplying that demand.
We’ll separate space heating from domestic hot water and use two different seasonal performance assumptions.
| Component | Useful heat | Efficiency | Electricity |
|---|---|---|---|
| Space heating | 10,000 kWh | 3.5 | 2,857 kWh |
| Domestic hot water | 2,070 kWh | 1.9 | 1,089 kWh |
| Total | 12,070 kWh | — | 3,947 kWh |
These efficiency figures are hypothetical. They are not manufacturer performance claims or guarantees of installed-system performance.
Using the October–December 2026 average electricity price of 26.32p/kWh:
3,947 × £0.2632 = approximately £1,039 annually
Annual Cost Comparison
| Heating system | Annual variable energy cost |
|---|---|
| Existing LPG boiler | £1,440 |
| Proposed heat pump | £1,039 |
| Illustrative saving | £401 |
Under these assumptions, switching from LPG to a heat pump reduces variable heating-energy expenditure by approximately 28%.
That saving does not yet include any avoided LPG tank rental or other fixed LPG charges.
Equally, it excludes any additional electrical consumption not covered by the stated efficiency assumptions, and it doesn’t account for equipment installation, servicing or financing costs.
This is a hypothetical comparison, not a completed Heat Loss Hub project or a prediction of savings for a particular property.
How Does the Price of LPG Affect Heat Pump Savings?
LPG prices can vary substantially between suppliers, locations, contracts and delivery arrangements.
Unlike domestic mains electricity supplied under Ofgem’s regulated default-tariff arrangements, bulk LPG prices are not covered by the energy price cap.
That makes the price you actually pay per litre particularly important.
Let’s keep the same hypothetical property and heat-pump calculation, but change the LPG purchase price.
| Bulk LPG price | Annual LPG fuel cost | Heat pump electricity | Annual saving |
|---|---|---|---|
| 50p/litre | £1,000 | £1,039 | −£39 |
| 60p/litre | £1,200 | £1,039 | £161 |
| 72p/litre | £1,440 | £1,039 | £401 |
| 85p/litre | £1,700 | £1,039 | £661 |
These LPG prices are illustrative scenarios, not current supplier quotations. Electricity remains at 26.32p/kWh, with unchanged heating demand and efficiency assumptions.
The result changes considerably.
At 50p per litre, the heat pump costs slightly more in variable energy charges under our assumptions.
At 72p per litre, it saves approximately £401 annually.
At 85p per litre, the saving increases to approximately £661.
In this example, the two systems reach variable-energy-cost parity at approximately 52p per litre of LPG.
That break-even price will change with the household’s actual electricity tariff, LPG boiler efficiency and heat-pump performance.
This is why claims that every LPG household will save a particular percentage are unreliable.
The most useful comparison is one based on your actual fuel price and a realistic prediction for your property.
How to Compare Using Your Own LPG Bills
If you currently heat your home with LPG, your fuel records provide a useful starting point for assessing a heat-pump conversion.
The first step is establishing how much LPG you actually consume annually.
A single delivery doesn’t necessarily represent a year’s use. You may have purchased fuel while the tank was partly full, or finished the year with a different amount remaining.
For greater accuracy, use delivery records covering a suitable period and account for changes in tank contents.
Then establish the price paid, including relevant VAT and any changes in contract pricing.
The useful heat can be estimated from the annual fuel consumption, appropriate calorific value and reasonable boiler-efficiency assumptions.
From there, the proposed heat pump’s electricity consumption can be estimated using separate space-heating and domestic-hot-water performance assumptions.
Information Worth Gathering
| Information | Why it’s useful |
|---|---|
| Annual LPG consumption | Establishes fuel used |
| Price per litre | Determines existing fuel costs |
| Boiler make, model and age | Helps assess likely efficiency |
| LPG tank rental | Identifies additional existing charges |
| Existing EPC or plans | Provides property information |
| Electricity tariff | Establishes future electricity costs |
| Existing heat-pump quotations | Allows the proposed system to be assessed |
Where LPG also supplies cooking or other appliances, that consumption should be separated from the heating and hot-water calculation as far as reasonably possible.
Likewise, historical fuel use may not reflect future heating demand if the property is undergoing insulation improvements, an extension or significant changes to its heating schedule.
You don’t need to perform every calculation yourself. Gathering the information provides a much better starting point for an independent technical assessment.
Bulk LPG vs Bottled LPG — Does the Comparison Change?
Some properties use bottled propane rather than a permanently installed bulk LPG tank.
The financial calculation is similar, but bottled gas is normally purchased by cylinder weight rather than litres.
For example, a 47 kg propane cylinder contains a quantity of fuel energy determined by its mass and the appropriate calorific value.
To establish the cost of useful heat, divide the price paid for the cylinder by the estimated useful heat delivered through the boiler.
Cost per useful kWh = Cylinder price ÷ (Fuel energy × Boiler efficiency)
The cylinder price should be based on the actual refill or exchange cost, with any relevant delivery or ongoing charges identified separately.
Avoid assuming a standard price per equivalent litre for every bottled-gas supplier.
Bottled LPG can be expensive, but the comparison needs to reflect the actual purchase price, fuel composition and appliance efficiency.
The same principle applies whether the propane arrives in a bulk tank or a cylinder: compare the cost of delivering useful heat, not simply the price of the fuel container.
Beyond Fuel Prices — LPG Tank Rental, Contracts and Other Costs
Running-cost comparisons should also consider expenses associated with storing and supplying LPG.
Bulk LPG households may pay tank rental or other standing charges, depending on their supply arrangement.
There may also be requirements concerning tank access, inspection, maintenance and deliveries.
If you replace LPG heating completely, some of these ongoing costs may disappear.
However, removing a tank doesn’t necessarily mean every charge ends immediately.
Before committing to a conversion, check whether the tank is owned or rented, when your supply agreement ends, whether termination charges apply and who is responsible for safe disconnection or removal.
The Competition and Markets Authority provides protections for domestic bulk-LPG customers switching suppliers, including limits on exclusive contracts.
However, switching LPG supplier and permanently ending LPG supply are different arrangements, so the terms of your particular agreement should be checked.
Read the government’s guidance on domestic bulk LPG supply agreements.
If LPG remains connected for cooking or another appliance, tank-related charges may also continue.
Avoided tank rental can improve the financial comparison, but only where that saving genuinely applies.
Why Heat Pump Design Matters When Replacing LPG
The price of LPG is only one side of the calculation.
The other is how efficiently the proposed heat pump can meet your home’s heating requirements.
A heat pump that needs to operate at unnecessarily high water temperatures will generally consume more electricity than an otherwise comparable system designed for lower operating temperatures.
The correct design begins with a reliable room-by-room heat loss calculation.
This establishes how much heating the building requires and the output needed in each room.
The existing radiators or underfloor heating can then be assessed at the proposed flow and return temperatures.
Some radiators may already provide sufficient output. Others may benefit from replacement to allow lower-temperature operation.
The system also needs appropriate pipework, hydraulic design, hot-water provision and controls.
Weather compensation can help the heat pump reduce its flow temperature during milder weather, while suitable commissioning supports stable and efficient operation.
There’s no universal percentage saving for every 10°C reduction in flow temperature. The actual benefit depends on the heat pump and the wider heating system.
For an LPG homeowner, the design objective is to identify a practical system with credible electricity-consumption expectations, not simply to select the heat pump with the highest advertised efficiency.
Heat Loss Hub provides independent heat loss calculations and complete heat-pump system design to help establish those requirements before installation.
Can LPG Homes Qualify for the £9,000 Heat Pump Grant?
Yes. Certain properties replacing LPG heating can qualify for additional funding through the Boiler Upgrade Scheme.
As of October 2026, the scheme provides £9,000 towards an eligible air-to-water or ground-source heat pump where the property is in England or Wales, currently uses LPG or oil heating and has no mains gas connection.
Other eligibility and installation requirements also apply.
The additional £1,500 grant uplift is currently available until 31 March 2027. The grant is claimed through an eligible MCS-certified installer.
This funding helps reduce the upfront installation cost. It doesn’t change the actual energy efficiency or running-cost comparison.
A lower net installation cost may improve the financial case for switching, but the eventual payback still depends on the complete project cost and actual operating costs.
Read our £9,000 Boiler Upgrade Scheme guide and the official government eligibility information.
Is an LPG Boiler and Heat Pump Hybrid Worth Considering?
A hybrid system retains a fossil-fuel boiler alongside a heat pump, allowing heating to be provided by one or both technologies according to the design and controls.
In some properties, this can offer a way to address particular installation constraints or staged renovation plans.
However, retaining LPG doesn’t automatically improve running costs.
Whether a hybrid is economical depends on the relative cost of useful heat from each system, the temperatures required and when the controls choose to operate the boiler.
For a household paying a relatively high LPG price, using the boiler extensively during cold weather could undermine the potential savings.
Retaining LPG also means some supply and maintenance costs may continue.
Fossil-fuel hybrid heat-pump systems are not eligible for the current Boiler Upgrade Scheme.
A hybrid shouldn’t be ruled out without considering the circumstances, but it should be justified through technical and financial assessment rather than treated as the default option for a difficult property.
Frequently Asked Questions
No. A heat pump can be significantly cheaper, but the outcome depends on LPG prices, electricity tariffs, boiler efficiency and achieved heat-pump performance. Where LPG is relatively inexpensive or heat-pump efficiency is low, the financial advantage may be small or disappear entirely.
The saving depends on your annual fuel consumption and purchase price. In our hypothetical example, a home using 2,000 litres annually at 72p per litre could save approximately £401 in variable energy costs. Your property’s actual result could be substantially different.
It can be. Bottled propane is often relatively expensive per unit of useful heat, but the comparison depends on the actual cylinder price, fuel quantity, boiler efficiency and proposed heat-pump performance. Use your own refill prices rather than assuming a national average.
Planning ahead can be sensible. A working boiler gives you time to assess heat loss, investigate radiators, compare equipment and obtain reliable installation quotations. However, the financial justification for replacing a working system depends on its condition, remaining life, operating costs and the proposed installation expenditure.
Yes, many older rural properties can be suitable. Stone walls, older windows and traditional construction may require more detailed assessment, but age alone doesn’t determine suitability. The heating system must be designed around the actual building. Read Will a Heat Pump Work in an Old House?
If the tank is rented, contact your supplier to establish the terms for ending supply and arranging removal. If you own it, suitable decommissioning and removal arrangements will need to be agreed. Check ownership, contract conditions and possible charges before assuming the tank can simply be taken away.
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Find Out What Replacing LPG Could Mean for Your Home
If you’re considering replacing LPG heating, the most useful starting point is understanding your existing fuel consumption and what an appropriately designed heat pump could cost to operate.
Heat Loss Hub provides independent room-by-room heat loss calculations, heat-pump system design and technical reviews for homeowners across England, Wales and Scotland.
We can help establish the heating requirements, assess the proposed operating temperatures and review equipment choices without selling heat pumps or receiving installation commissions.
If you have LPG delivery records, your current price per litre or installation quotations, include them with your enquiry.
Independent calculations. Transparent comparisons. Heating design based on your property, not generic savings promises.