Running my heat pump for half the cost of a gas boiler…

I’ve recently been doing a Policy Fellowship with the Royal Academy of Engineering looking at the value of heat flexibility and, importantly, how we deliver it. To understand some of the pros and cons, I decided to implement some heat flexibility of my own using my heat pump which is now running through its second winter.

To do this, I’m operating my heat pump on Octopus Energy Agile tariff, which, for those unfamiliar, is linked to the wholesale price and varies every half hour.  I started simply by putting my Ecodan heat pump into timed adaptive control with an off-period between 4pm and 7pm when the high prices occur – this involved no energy-nerdery.  However, I’ve slowly made the controls more sophisticated since the beginning of the heating season….

1.      I wrote some code to detect when the Agile tariff went above 30p/kWh and turn the heat setpoint down to 18°C, but then, horror of horrors, we had a Dunkelflaute event in a very cold November week and the Agile price was above 30p/kWh nearly all afternoon – my heat pump ended up running during the most expensive three hours of 2023 (Chart – Old Algorithm)!

2.      I wrote some more code to pull the Agile tariff in an hour’s time and boost the room temperature set point in steps of 0.5°C inversely proportional to ambient temperature, then when the actual peak kicks in, the temperature setpoint is dropped to 18°C.

3.      Finally, I refined the peak period so that it finds the 6 most expensive half hour periods in the morning and afternoon and pre-boosts before those periods and reduces the setpoint during them.

All this has worked very well, and with the boost, even on cold days, the temperature in my front room rarely drops below 19°C. You can see in the chart (New Algorithm) than on a day when temperatures were around freezing, the room temperature dropped to 19°C. Clearly that’s a function of how well insulated and draft-proofed your house is, but perhaps shows that there is additional value to be had from better insulation over and above simply reducing the thermal input needed to maintain a comfortable temperature.

So what is the effect of this on my bills?  Well, as you can see in the figures, despite some poorly performing days in November, My heat pump has run at 52% of the cost of providing the same amount of heat via a gas boiler. I think if my algorithm had been spot on to start, then it would have been half the cost – let’s see what happens when I have a full year of data. (Note for the gas cost, I took the 'Flexible Octopus' gas tariff, assumed a boiler efficiency of 87% and spread the standing charge (£100/annum) over 15,000kWh, my typical historic gas use.)

Annually that equates to a saving of £600 if the sCoP remains as 4.1 (which it achieved last year), noting that I have conservatively assumed the same heat input from my heat pump as gas used by my boiler on the basis that the house will be warmer, on average, and therefore losses slightly greater. To use Government speak, if half of UK homes could adopt this, then it would result in consumer savings of £7.92Bn per annum.

In reality, it would also have wider system benefits – it could allow heat pumps to be deployed early before network reinforcement is completed since peak demand can be reduced, and it could help reduce the installed capacity of our future ‘Dunkelflaute’ generation (be that unabated gas, hydrogen to power or some yet to be developed solution), and allow that capacity to run at a higher load factor and therefore with lower unit cost.

But we can’t expect consumers to do this alone, we need electricity suppliers to step up with offerings, we need them to work with heat pump installers so that the technology is built-in during heat pump installation and we need the right regulatory frameworks to enable these things to happen for the masses.