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I am on the board of a charitable housing trust and we provide housing at social rent levels.
We are currently renovating a vacant property and are debating which type of heating to install. It is an old stone built house but the walls and floors have been well insulated during the renovation so far.
Originally oil fired was specified and so microbore piping for the rads was installed and this may be the deciding factor even though our heating engineer say he can make it work.
Some of our board are now wanting to tick the green box and are pushing for air source which I agree would be nice but the overiding factor is it has to be affordable to run for low income tenants.
Does anyone have experience they could share of the cost comparisons please?
This is down to thermal efficiency of the building, needs to be done by calculation. Heating oil prices are pretty volatile so a straight cost comparison isnt that easy. Is there a secondary heat source I.e log burner?
Yes there is a og burner in the sitting room. It is a small property one bedroomed. The bedroom and bathroom are above the sitting room with the kitchen in a single story extension. I went in today to speak to the builder, he was working upstairs where it was very warm after he had had an electric heater running for an hour earlier in the day downstairs.
Small is good from a heat loss pov. Again, you need to do the maths but ashp likely to be cheaper particularly if topped up with a log burner in cold weather.
Article here suggests similar running costs at present. Oil prices are generally more volatile than electric (can be good and bad). Electricity is heading towards carbon neutral (nominally by 2030) so may be less pollution tax in the future.
Oil is storage faff that electricity isn't for a tenant.
https://www.goodenergy.co.uk/blog/how-much-do-oil-boilers-cost-to-run/
A lot depends on the set up and installation. You have to convince people that it's cheaper to leave a heat pump running all the time, even when you're out, and a lot of people can't understand this because science.
Another consideration is, if these are low income residents, are they going to be able to afford biggish deliveries of oil?
1000L is nearly £600 ATM.
Although that would last a long time could they deal with that sort of outgoing in a single transaction compared to electricity which is spread out over each month?
That ^ is a very good point to consider.
Pair air source it with solar panels and a battery and you'll get very low costs as long as you are well insulated. Also try to spec propane as the refrigerant for the heat pump if it is somewhere that will consistently see minus temperatures during winter. Down from circa 270 a month for "all energy" to 20 a month here after switching from gas to air source. That is down to being able to purchase cheap electricity stored in the battery at night to top up the energy provided by solar, having excess energy to export during the summer and having an air source CoP of over 3.5 on average over the year.
Another potential issue is running out of oil; if they do run out....what do the occupants do if there's a minimum delivery amount of oil, they don't have the cash for that (or the engineer attendance to sort out the now bone dry oil boiler with airlocks in some pipework?)
No contest really. ASHP wins on a couple of things straight off: no massive tank of stealable, expensive, dino juice hanging around; clean and efficient.
edit: running costs - I would be surprised if ASHP running costs were higher than oil CH. but this will depend somewhat on the price of oil when the folks buy a tank full. At least the ASHP running costs can be regularly assessed and the electricity tariff chosen appropriately and conveniently. Plus, as has been said, solar and batteries can make a difference.
only drawback is the microbore pipe. But that should have been replaced with at least 15mm anyway.
good luck.
Another potential issue is running out of oil; if they do run out...
Yep. Heating with oil does require a bit of interaction but it's getting better.
Minimum delivery is 500L (£300 atm)
)Pair air source it with solar panels and a battery and you'll get very low costs
Sounds like the house is small so very little scope for PV plus the extra costs.
Oil would certainly be the cheapest install solution. I would have thought microbore could be an issue for ASHP.
Surprised anyone installs microbore piping these days as it can't cost much more at renovation stage to install bigger pipes suitable for future switch to ASHP.
All new heating systems must be designed for low flow temperatures, 55°C, this is part of the Building Regulations, not sure if it is UK wide you would need to check locally.
This is regardless of the fuel used so I suspect the microbore is not suitable for any system, I would have it removed, ask to see the heat loss calculations for the property and get the system designed correctly.
ASHP should be cheaper than oil, providing the system is designed and installed correctly, the end user is given the correct advice on how to use it (see comments above) and the right energy tariff is chosen.
Install should be cheaper than oil too as it will be zero rated for VAT and there should be a grant available.
As mentioned above the cost for the radiators and pipework should be the same as it it designed to the same sort of temperatures, by the time you buy an oil tank and boiler, that is probably more expensive than an ASHP. Especially as one is subject to 20%!
I think the difficulty in comparing to the two is having to second guess what the needs of a tenant you presumably don't already have are. The big difference really between the two options - for a tenant - is they are two very different styles of operation that suit two different lifestyles. Oil is very much heat on demand, ASHP is more about a steady supply. So a lot depends on how you live you life - some people's lives revolve more around being at home and that steady supply is perfect (retirees or someone with a young family perhaps), if you're out working all the time the idea of heating a house you are not in is unattractive and coming home to a house that will then take hours to warm up isn't ideal either (I stayed in a new-built apartment for a job a few years ago that was ASHP and it took 2 days from my arrival for it to feel like the heating was actually working). In a gig economy era some people will prefer occasional on-off payments for oil over a fixed monthly overhead for electric
If you don't have that tenant yet you either need to look at the house as an offer to tenants - is it more suitable for a working couple? is it somewhere for children? (A small house with a garden might suit older tenants)- or look at the need locally in terms of demand and shortfall. Whichever heat system you choose you just state it as part of the offer and let prospective tenants choose whether it suits them or not.
I think you need a realistic assesment of how the ASHP with microbore pipes will workout practically in the long term - the engineer saying he can 'make it work' isn't the same as the result being effective or economical for someone to live with.
Regardless of if you are in or not the ASHP should be set to run at a constant background temp, probably about 2° -3° below desired set point.
Mine is set to heat the flat to 22° from 1-4pm when we are both \t work, but that is using cheap electricity. It is then off during the expensive period but we have put enough heat into the building fabric for it to retain the heat.
Our average electricity price is 18p/kW by utilising the cheap rate. In fact I have just heated the hot water to 62°C for nothing during a period of free electricity.
As mentioned above the cost for the radiators and pipework should be the same as it it designed to the same sort of temperatures, by the time you buy an oil tank and boiler
It sounds like the existing rads and pipework could be used with oil though which would reduce the cost - otherwise an ASHP would surely be the way to go. Good point about the tank cost though if there isn't one already.
the engineer saying he can 'make it work' isn't the same as the result being effective or economical
Very much this..... doesn't fill you with confidence!
some people will prefer occasional on-off payments for oil over a fixed monthly overhead for electric
Yep. And little planning does allow you to buy oil when it's cheaper (i.e. the summer) and you don't end up paying money to the electricity company in the summer when you're not using it.
Another complication: If the property is tenanted then how do you deal with oil that has been purchased by the tenants but is still in the tank when they leave?
In addition to this are the costs involved if/when the tank runs dry because they couldn't afford another 500L - at least with electricity you don't potentially need to call out a heating guy if you run out of credit!
It's quite tricky and a lot depends, already said, on the type of tenant and the tenancy period.
I'm still running on oil and have just ordered again as prices aren't too bad at the moment. 1.5 p a litre cheaper than this time last year and cheaper tan last time I topped up in March as well. Quite a few companies will run an account for you and take monthly payments too so you don't have a big bill at one time but it does need planning.
I don't know which is best for your situation. But it looks to be a failure of government policy that this isn't a no-brainer. Building regs should have forced use of ASHP-compatible system in the renovation; and cost of electricity should be reduced and oil increased (by rebalancing levies) so running cost for ASHP is cheaper.
and cost of electricity should be reduced and oil increased (by rebalancing levies) so running cost for ASHP is cheaper.
Electricity is already cheap and it's an interesting idea to increase the cost of fuel to force ASHP upon even those who can't afford to change. 🙄
Based on secondary heat source (log burner) that would provide instant heat, the sensible choice for me would be ASHP. Regular, low level heating with the log burner to boost heat as and when required.
Oil fired on that small a property with improved insulation, would they even get through 1000ltrs in a year? Although, tbf, you can set up a standing order to pay monthly into an account for oil, you may end up out of phase being in credit before you need oil, not a sensible position to be in if you're short of cash.
If you do go ASHP get some who knows what they're doing and get it supplied as a complete system for heating & hot water including the controls.
Might be slightly more expensive, but better than a "cobbled together" system from many different suppliers/manufacturers which won't have constant issues and will run properly.
Sharkbait - electricity could be cheaper, the price is fixed by the cost of the gas that is sometimes used to generate it, not the actual cost it takes to generate electricity.
I do agree though, you can't just go and make electricity way cheaper and put the tariff on other fuels as you will plunge millions into fuel poverty. You can however charge a cheaper rate for when it is used with a heat pump as many suppliers do now anyway. Then the running cost of a heat pump is way lower than nearly anything else, providing the system is properly designed and installed of course.
Pair air source it with solar panels and a battery and you'll get very low costs as long as you are well insulated
That isnt working for us at all since the end of September. 4kW of panels, 9kW of battery, which are charged to a maximum of 15% every day. If we were on a cheap overnight trip, we could fill up the batteries, but we have to wait another 8 months or so to get on a cheap overnight tariff.
In the Summer months, our electric cost is around 75pence per day, which is a bonus, but it isnt an all year round thing due to short daylight hours and overcast skies.
To the OP, for such a small property, ASHP would be my choice. Though oil has been the cheapest form of heating for the last 4 years, maybe more.
Ooh. Meant to say. My recommendation for a battery was entirely based on being able to access a cheap overnight tariff. Intelligent Octopus Go is 7.5p/kWh overnight.
No idea if relevant, but the chap from Heat Geek was interviewed by Rob Llewellyn a few weeks ago, and he was saying how they've analysed years of heat pump installs with AI, and the outcome was that they've been over-engineering everything, so their installs are now cheaper/shorter and still work fine.
Very little pushback on what he was saying, but he mentioned they were now getting them in and working with less upgrades to pipes, rads, etc.
Oil fired on that small a property with improved insulation, would they even get through 1000ltrs in a year?
No. And if it does it's not very well insulated at all
But ashp.....does the property that small have somewhere suitable to stick a heatpump ........ Installer that came to see me wouldn't stick it under a window due to noise nor would he fit it on the north side of my house - both reasons I fully understand ....didn't leave him many options though.
Oil though 5.2p/kWh currently. And tbh if you time the buy and avoid the peak cold snaps when prices sky rocket they have been fairly consistent for the last 15 years as opposed to leccy and gas which have only been climbing........
Install costs also significantly less.
But for ticking a box ashp wins.
If your tenant can't get time-of-day tariffs then it will be vastly more expensive than oil, particularly so if they're on a pre-payment meter.
Numbers-wise, when it's mild (as it has been this last week) I use 12kWh for the heating and hot water combined. When the temperature hovers around freezing or goes below, it's closer to 30kWh. ~£8/day roughly vs £6 for oil (and likely much less if the oil boiler only runs for a few hours a day).
It's cheaper for me in milder conditions and I have 10kWh of batteries and can fill them up at 7p/kWh. In your example I'd definitely just get another oil boiler fitted. You can also use an oil boiler to heat the house for short periods, an ASHP isn't flexible enough for this.
Installing an ASHP might not get you the tick-box you need environmentally either; they count as electric heating on an EPC and dragged my house from B to C.
Thanks all! Lots of food for thought there. Personally, I am thinking oil may be the best solution. Mainly for the flexibility it offers in running options which could make it cheaper. Having just read up a bit about what is needed to run air source through microbore it doesn't fill me with confidence. Replacing the microbore is not an option as all the walls have just had the plastering finished.
As others have said, many heating oil companies will let you pay in instalments in advance, and Boiler Juice have a new doohickey that monitors the level in your tank and will automatically order a top-up.