Just wondering how the running cost of an oil boiler compare with a heat pump? As it would seem that there is a sort of standing charge and then the cost of the fuel? 

Posted by: @batpred

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Just wondering how the running cost of an oil boiler compare with a heat pump? As it would seem that there is a sort of standing charge and then the cost of the fuel? 

The answer to that is at the whim of global despots (and others).

@jamespa 

Absolutely, and that just comes back to bite us through increased defense spending! 

Posted by: @batpred

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Just wondering how the running cost of an oil boiler compare with a heat pump? As it would seem that there is a sort of standing charge and then the cost of the fuel? 

I can answer that pretty directly since we used to have an oil boiler before we switched to a heat pump. When on oil, we found we were pretty much bang on using 2,000 litres of oil a year; one delivery of 1,000 litres was typically just before Christmas and another came in May. As a result, since switching to a heat pump I've maintained a record of the oil prices we'd've paid (courtesy of homefuelsdirect) at the end of those two months each year.

There is no standing charge at all; just the initial cost of installing an oil tank (irrelevant for us since we inherited the tank when we bought the house) and any maintenance that might be required to keep it safe and legal. However, since one buys in bulk in advance, any volatility in fuel price makes a huge difference to running costs since if the market is cheap around (for us) May, we'd get the benefit for the next seven months whereas the Russian oil pipeline craziness a few years ago would've meant us having to buy at a hugely inflated price and take the hit for the following five or seven months in the hope the price would be better when the next tank refill came around.

These price fluctuations are not insignificant either. The beginning of May last year saw an ex VAT price per litre of 59.05p whereas the beginning of May this year it was 130.39p. It was also 105p at the beginning of May 2022, just to demonstrate that the current Middle East issues are not so exceptional and so big swings are not to be ignored.

All that means between 1st May 2022 and 2nd June this year (admittedly with solar PV, battery and Octopus Agile as well as just the heat pump) the electricity used that has replaced the consumption of oil has weighed in at a saving of £3,618.99 (oil for the period would've been £7,323.91 whereas the electricity replacing that oil was £3,704.92).

Our savings separate to that (electricity used for other home use, electricity exported, electricity used for the EV etc.) are obviously not included in that £3,600 figure. 

I share the same experience as @majordennisbloodnok having switched from an oil boiler in June 2024 - our ASHP was around half the cost of oil to run in the first year, and that was before the current price increases due to the Iran war.

In my monthly spreadsheet, I record the current price of gas and oil on the 1st of the month, and use this to calculate the price per kWh equivalent to deliver the same amount of heat based on my current monthly COP. In May 2026, for example, electricity priced at 33p/kWh would have been equivalent to gas, and 63p/kWh would have been equivalent to oil, so the 12-13p/kWh paid to deliver the same amount of heat was significantly cheaper than either gas or oil. I find this a really useful metric to remind myself just how much cheaper the ASHP is than our old oil boiler.

For anyone still using an oil boiler, I would recommend smoothing the cost roller-coaster by sticking £10k in an S&S ISA and using it to buy a crude oil fund (ETF) any time the price falls below $60 per barrel (or whatever the long term average is) and then selling a little of the fund to free up cash any time you need to fill the oil tank when the price is above the long term average. This way you are not limited to only buying the amount of oil your tank will physically hold when oil is cheap and can lock in cheaper prices to offset future price increases, such as we are seeing presently. During Covid when kerosene was 20p/L was an exceptionally good time to do this, and anyone who purchased 10 years of 'virtual' oil has been laughing ever since.

Posted by: @jimseng

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Hi.
The BUS grant for new self builds is pretty straight forward - if it is a self build you are entitled to the full 7.5k BUS, even if you are not replacing a system but installing from new. The 9k uplift for off grid properties is coming in July and I am trying to establish if it is applicable to new self build properties too. The wording seems the same as for the 7.5k BUS, it talks about replacing existing systems and new self builds don't get discussed. Does anybody know what the situation is? Can anyone point to a specific document that says new builds are only eligible for the 7.5k BUS? I could easily opt to put an oil boiler into my new home as I am not on mains gas here so I wonder if the incentive applies to me to. As mentioned in another post I have already had the 7.5k grant offered but it has elapsed as it was 6 months ago.

 

Hopefully this will answer your question.

To be entitled to the £9K you need to have removed either a bottle LPG boiler or oil boiler, if it is a new build you did not have either in the 1st place and cannot remove it. The reason you get the £7.5K is because the Government would like you to consider an ASHP over direct electric, oil, gas or other forms for fossil fuel burning equipment which other than for infrastructure they cannot stop you having. So the £7.5k is the carrot.

Its a nice carrot!