Ways to Save – The Most Energy Efficient Home Heating in 2023

With the cost of living rising month by month at the moment, finding ways to become more energy efficient is a top priority for many households. Heating is a significant contributor to our energy bills, making it essential to invest in an energy efficient heating system that can help us save money in the long run.

In this blog, we’ll compare gas boilers with electric boilers and renewable ways to reduce energy consumption without compromising heat output to help find the most energy efficient heating system for your home.

So have a read as we explore the benefits of energy efficient heating and discover how you can save money while contributing to a sustainable future on the road to ‘Net Zero’.

What affects the cost of heating your home?

First things first, let’s talk about the factors that can affect the cost of heating your home. Heating your home can be a significant expense, and the cost of home heating can vary depending on certain variables. Here are some of the key things that can impact the cost of home heating:

• Fuel type: The type of fuel you use for heating can have a big impact on the cost. Natural gas is typically the most affordable option (as it’s often delivered direct to homes via the gas mains network), followed by heating oil and propane. Electric heating can be more expensive, but it may be the only option in some areas which are off the gas grid.
• The efficiency of your heating system: The efficiency of your heating system can also impact the cost. A newer, more efficient system will generally cost less to run than an older, less efficient one. If your system is more than ten years old, it may be worth considering an upgrade.
• The size of your home: The size of your home can also impact the cost of heating. Larger homes will obviously need more energy to heat than smaller ones, but it doesn’t mean that larger homes are necessarily inefficient. If you have a large home, it may be worth considering zoning your heating system so that you can heat only the areas you are using.
• Insulation: The insulation in your home can impact the cost of heating as well. If your home is poorly insulated, heat can escape through the walls and roof, which can drive up the cost of heating. Adding insulation can help to keep your home warmer and reduce your heating costs.
• Thermostat settings: The settings on your thermostat can also impact the cost of heating. Setting your thermostat to a lower temperature can help to reduce your heating costs. You can also consider installing a programmable thermostat that will automatically adjust the temperature based on your schedule. For example, you might want to make sure your heating comes on and starts to warm the property as you arrive home from work during the colder months.
• Energy prices: Finally, the price of energy can impact the cost of home heating. Energy prices can fluctuate depending on a range of factors, including supply and demand, global events, and weather conditions. The recent conflict in Ukraine, for example, has impacted global energy prices on the world markets, which has a knock-on effect for consumers in the UK.

By considering these factors and taking steps to reduce your heating costs, you can keep your home warm and comfortable while saving money on your energy bills.

Is it cheaper to use gas or electricity to heat my home?

Wondering about the unit rate for gas and electricity? Under the current Ofgem energy price cap (1 October to 31 December 2025), the average unit rates for a dual-fuel household are about 6.29p per kWh for gas and 26.35p per kWh for electricity.

The price cap limits what suppliers can charge per unit and for the daily standing charge, but it does not fix your total bill — that still depends on how much energy your household uses. Because energy markets remain volatile and regional variations apply, it’s crucial to stay informed about changes and focus on energy-efficient heating solutions to help mitigate potential increases.

But what do these numbers mean to you?

Relying on natural gas to heat your home (for example, with a gas boiler) generally remains cheaper per kWh than using electric heating systems, such as electric boilers or air-source heat pumps.

However, the picture is changing as energy efficiency and sustainability become greater priorities. Modern gas boilers can achieve efficiencies of up to 94%, but electricity-powered heating systems — especially heat pumps — can convert every 1 kWh of electricity into up to 3 kWh of heat, making them more efficient in the long run when paired with renewable electricity.

To reduce gas consumption and energy bills, many homeowners are now pairing their gas boilers with solar PV panels. Throughout the year, solar panels can generate enough electricity to cover up to 40–60% of a household’s heating and hot water needs, significantly reducing energy costs and carbon emissions. While the initial installation cost can be high, the return on investment typically grows as energy prices rise.

Energy prices in the UK are regulated by Ofgem’s price cap, which changes every three months in response to wholesale energy costs. This means your heating expenses may still fluctuate, so it’s essential to stay informed about market updates and consider energy-efficient or renewable heating options to protect yourself from future price increases.

For the most accurate and up-to-date information on regional energy prices and tariffs, visit the UK Government website or Ofgem.

How much does a heat pump cost?

The cost of buying and installing heat pumps is currently much higher than that of a gas boiler. The average price of a heat pump installation is between £8.5k – £12k for an air source heat pump, and over £18k for a ground source heat pump – that’s almost 5 all-inclusive trips to the Maldives for a couple!

If you are wondering about the additional cost for the ground source heat pump installation, it comes from the external and disruptive work in the garden.

It’s fair to say that heat pumps are still not affordable for the vast majority of homeowners in the UK at current prices. By way of comparison, the average price of a conventional gas combi boiler is between £1.5k – £3k (including installation). It doesn’t mean though that this price discrepancy will always be there.

So will hydrogen boilers and heat pumps replace gas boilers in the future?

The potential for hydrogen boilers and heat pumps to replace gas boilers is an area of ongoing research and development. Hydrogen boilers are still in the prototype stage and face challenges such as hydrogen production, storage, and transport. Heat pumps, on the other hand, are already available and can provide a more sustainable and efficient heating option than gas boilers, however, they may not be suitable for all types of homes, infrastructure, climates, and budgets.

Ultimately, the feasibility of hydrogen boilers and heat pumps replacing gas boilers will depend on the availability and affordability of these technologies, as well as their ability to meet the needs of different types of buildings and regions. As with many emerging technologies, it’s certainly possible the costs will come down over time.

Oil boilers energy efficiency and running costs

While gas boilers are the dominant source of heat and hot water for UK households, it’s been estimated that 1.1 million homes run on oil heating. Most of these properties will be “off-grid”, meaning they’re not connected to the national gas grid for heating or cooking, and are perhaps in rural areas where oil is the only viable heating system option. Oil heating is also referred to as a ‘wet’ system because it burns fluid (oil). Oil fuel is more affordable than electricity and LPG, making it a popular alternative for suburban and rural homes.

Oil boilers can vary in energy efficiency and running costs depending on age, efficiency rating, location and fuel type. Older oil boilers typically have lower efficiency ratings, ranging from 50% to 70%, meaning they convert a lower percentage of the fuel they burn into heat for your home. In contrast, modern oil boilers can achieve up to 90% efficiency ratings, making them much more energy-efficient and cost-effective.

In terms of running costs, heating oil costs approximately £0.09 per kWh – before you say it’s slightly cheaper than natural gas running costs, you’ll need to remember that oil prices often fluctuate more than gas prices. Additionally, oil boilers require regular maintenance and servicing to ensure they are running efficiently and safely, which can add to their overall operating costs. That being said, oil boilers can still be a viable and effective heating solution for those without access to natural gas or other heating options.

LPG boilers – are they a good option?

An LPG boiler is a boiler that is powered by Liquefied Petroleum Gas (LPG), which is a flammable hydrocarbon gas that can be used as a fuel in heating appliances, cooking equipment, and vehicles. LPG is typically stored in gas bottles or tanks, and it can be used in areas that are not connected to the mains gas grid. LPG boilers work in a similar way to natural gas boilers, but they require a different burner. Just like oil boilers, LPG boilers are a good option for those off the gas grid but they have their limitations, i.e. LPG on-site storage tanks, regular maintenance, and refuelling costs.

So what’s the perfect type of heating for my home?

Overall, a gas boiler is the most reliable and affordable way to heat your home. The cost of installing a gas boiler remains cheaper than heat pumps; in addition to that, the running costs for gas boilers are much cheaper than oil boilers, LPG boilers and electric boilers.

If your house is off the gas grid, oil boilers and LPG boilers are your best option.

If you’re environmentally conscious, renewable technology like solar panels can power your boiler (gas or electric), which is both cost-effective and eco-friendly. Alternatively, a heat pump with underfloor heating is also an excellent option from an environmental perspective but expect to pay a premium price to get them installed.

How can I save money on my heating bills?

With the cost of energy on the rise, many people are looking for ways to save money on their heating bills. Here are some tips to help you reduce your heating costs and keep your home warm and comfortable:

• Turn down the thermostat: Reducing the temperature by just one degree can save you up to 10% on your heating bill. Try turning your thermostat down a few degrees, or consider installing a programmable thermostat that will automatically adjust the temperature based on your schedule.
• Invest in improving your home insulation: Proper insulation can help to keep your home warm and reduce the amount of heat that escapes. Make sure your loft is properly insulated, and consider adding insulation to your walls and floors if needed. Newer homes are generally better insulated, but older houses can have insulation retrofitted.
• Use draft excluders: Draft excluders can help to keep cold air out and warm air in. Use them around doors and windows, and consider adding them to any gaps or cracks in your walls or floors.
• Close doors and windows: Make sure all doors and windows are closed when you’re not using them. This will help to keep warm air in and cold air out.
• Use curtains and blinds: Close your curtains or blinds at night to help keep the heat in. During the day, open them up to let the sunlight in and naturally warm up your home. You may be surprised how much energy is lost through windows and how much can be saved by simply drawing the drapes!
• Invest in a new energy-efficient gas boiler: Investing in a new energy-efficient gas boiler can provide many benefits, including lower energy bills, improved efficiency, increased comfort, longer lifespan, better safety features, and increased property value.
• Get your boiler serviced annually: Regular boiler maintenance carried out by a properly registered Gas Safe engineer can help to ensure it’s working efficiently and effectively. This can help to reduce your heating costs, keep your boiler guarantee valid and prevent costly repairs down the line.