The residential sector accounts for around 17% of the UK’s carbon emissions in the UK, with gas boilers being responsible for the vast majority. Currently, 23 million homes are using gas boilers for their central heating and hot water. The only viable options for decarbonising home heating are those using electricity as a fuel source.
This note sets out the main options for heating homes with electricity, along with a brief outline of the advantages and disadvantages of each.
Click on the links below to explore the different options:
Key points
- Heat pumps are usually the most efficient technology for heating homes, using 3 to 4 times less energy to provide the same heat as a boiler.
- Direct electric heating options (panel heaters, storage heaters, electric boilers) are much less efficient. They can be cheap to install, but have very high running costs and impose extra stress on the grid.
- Air source heat pumps are suitable for most homes in the UK.
- Homes less suitable for air source heat pumps, such as flats in dense urban areas, can connect to district heat networks or networked ground source heat pumps as an alternative option.
- Depending on circumstances, some households could also use air-to-air heat pumps and zero emission boilers (ZEBs).
- Technologies such as solar panels and battery storage can complement electric heating to reduce running costs. Time or type of use tariffs can further decrease consumer electricity bills.
The UK’s housing stock is very old
- More than half of properties are over 60 years old (EHS).
- The UK has an unusually low number of flats compared to mainland Europe. 25% of English dwellings are detached houses and bungalows, 25% are semi-detached, ~30% are terraced houses and only ~20% are flats.
- The proportion of property types differ between regions. Scotland has a much higher proportion of flats than England (36%). 20% of its housing is semi-detached, 20% terraced houses and 23% detached houses.
Future prices of electricity and gas will impact incentives to electrify heating:
- The costs of running an electrical heating system will depend on electricity prices. A key metric is the price of electricity relative to gas (the price ratio) because this will determine the potential consumer benefit of switching from gas to electricity.
- Gas wholesale prices have risen by a factor of 3 to 4 over the last 15 years, with these increased costs being passed down to consumers.
- The UK Government’s Department for Energy Security and Net Zero (DESNZ) predicts that wholesale electricity prices will drop significantly between now and 2030 and then rise a little between then and 2040. Gas prices are also predicted to decrease slightly by 2030, but there is much more uncertainty, as international events impact the wholesale price of imports.
- Price components, namely the costs associated with infrastructure, might contribute to the final consumer prices of electricity and gas rising. But the government could reduce the household price of electricity relative to gas by shifting policy levies from electricity bills.
- For a typical-sized home, a heat pump currently costs about the same to run as a gas boiler, with the unit price of electricity being almost 4 times higher than the unit price of gas. If policy levies are shifted to gas, the price ratio could become as low as 2.5, which would make heat pumps by far the most affordable heating option.
