Relative cost of heating with a heat pump vs. gas (How to reduce your heating bill by 100%)

We've now had our heat pump for one whole winter. For the purposes of this blog post, "winter" refers to each period of November through to and including March, as those are the months when we use heating. Because we've gone through our first winter period with the heat pump we can now make a comparison with other winters when we used gas for heating and work out both the financial cost and (more importantly) the emissions due to both heating options.

This house was cold
We've lived in our home since 2007 and I've recorded our energy consumption consistently each month. Our home was built in 1972, just after the discovery of gas under the Netherlands. At this time it was assumed that gas would always be an inexpensive fuel source and no-one was making much effort to make housing efficient. We had very little insulation and single glazing in most of the windows. Only the living room, dining room and kitchen had old and basic double glazing.

When we worked out how much the first winter's energy bills were going to be this really shocked us and we ended up setting the thermostat as low as 14 C and in order to reduce the gas consumption we even turned the heating completely off on some of the coldest days of winter until our children were about to come home from school. This was quite unpleasant so we started some steps to insulate our home even in the first winter in order to reduce the energy requirement.

Each insulation job contributed to reduced heating requirements and a warmer house. At first there isn't much of a reduction in consumption to see, but that's because we were compensating by living with a bit more warmth each winter. The difference between the blue and red line was the consumption of the pilot light in an old gas water heater that we replaced with an electric water heater last year.

By the winter of 2022/2023, the last in which we still had a gas connection, our heating consumed just 287 m3 of gas rather than the average of just over 1110 m3 of gas per winter that we had burnt over the first four years that we lived here. That's about a 70% reduction in energy input, without changing the heating system.

This winter we used an air-air heat pump in our living room as almost the only heat source between November and March. There's a heated towel rail / IR panel in the bathroom which comes on with a timer every morning but otherwise no permanent heating upstairs to replace the no longer used radiators. We did make very occasional use of portable electric heaters. We've been quite warm. It's certainly far more comfortable upstairs now without any heating than it was in the first years that we lived here when hot radiators struggled to keep uninsulated bedrooms with large single glazed windows up to a comfortable temperature.

Energy consumed
Our heat pump consumed 682 kWh of electricity over the five month winter period. That's roughly equivalent to the energy content of 68 m3 of gas. i.e. this winter we used only about 6% as much energy to heat our home as was the case when we first moved here.

I have to admit that this was not a particularly cold winter, but it was especially grey and wet so the solar panels that were supposed to run the heating didn't do as well as was expected. Despite that, even this winter, they still generated more than 30% of the electricity that we consumed over those five months so we had to buy just 470 kWh of electricity from the grid to run our heating.

CO2 output
We're signed up to a green tariff which promises us 100% green electricity ("100% groene stroom uit Nederland") but I never know if you can really trust such a claim so I will instead take the an average carbon intensity of 223 g per kWh for Dutch electricity in 2023 as a worst case scenario for our CO2 output.

That worst case scenario suggests that our heating may have produced 105 kg of CO2 this winter (470 * 0.223), which is a huge reduction compared with the emissions of our gas boiler when we first moved in. Our gas heating CO2 output averaged around 2000 kg of CO2 per winter over the first four years that we lived here. i.e. the worst case scenario gives us a 95% reduction in CO2 output for heating due to a combination of insulation and electric heat pump replacing the gas boiler. The first 75% or so of that reduction in emissions is due to the insulation and the heat pump is responsible for the rest.

What would it have cost if we were still using gas ? What has it cost this year all-electric ?
We could never afford that level of gas usage so we shivered more than most when we first came to live in the Netherlands. If we'd continued burning gas at the rate that we did in the first four years that we lived here then it would have cost over €1600 for heating this winter. Instead of this, we insulated our home in order to consume far less heat. If we had stayed as we were last winter, with the same insulation but with gas heating instead of the heat pump, then we'd have consumed about €400 worth of gas over the winter period. That's already quite a saving over the average.

According to our energy supplier, the gas consumption of an average home like ours (semi-detached / 2 onder 1 kap) over the winter period is around 1360 m3, which is actually higher than what we found unacceptable when we moved here.  At the current price of gas quoted by the energy that gas costs an average family in an average house like ours about €1930 each winter and each of those homes will produce over 2400 kg of CO2 for heating over that period.

But our gas supply was removed last year and we're all electric now, so what did it actually cost us to heat with the heat pump ?

For the last year we've been paying our energy company €5 per month for the electricity connection only (there is no gas connection). We've just come to the end of the yearly billing period and they now owe us more than €200 for the excess electricity that we produced from our solar panels and contributed to the grid. i.e. our energy bill is negative.

End of year summary from our energy company. They owe us €252, and we can continue to pay them €5 per month next year.

Insulate ! It makes a huge difference to your comfort and your bills. Then you can install a small and inexpensive heatpump.
Every step that we've taken in the past to better insulate our home has led to lower bills, lower CO2 output, and more comfort. It took us a while to do everything because our income is small so we couldn't do it all at once. But do everything you can, as soon as you can. It's really worthwhile to do all of this before you even think of replacing the heating system.

If you're in a rented home that makes things more complicated, but encourage your landlord to everything they can. This is a no-brainer for any sensible landlord as any work done adds to the value of their asset. If you're in an apartment and shared ownership of walls and roofs is a problem, then do whatever you can to get the organisation (probably a VVE in the Netherlands) to make changes. That's a difficult situation because you have to get a lot of people to agree. But it's all worthwhile. Every penny spent on heating is wasted, every penny helps to pollute the planet, so let's stop spending so much on it.

Reducing energy input
Something that seems quite crazy to me is that people replace absurdly oversized gas-powered boilers (ours was rated at 28 kW!) with equally absurdly oversized heat pumps. Yes, they'll cost less to run and have lower emissions than gas heaters, but they still consume a lot of electricity. Those high powered heat pumps require a three phase connection (single phase is limited to 16 A / 3.5 kW in the Netherlands) in order to suck in enough current to produce their huge outputs. What we installed has a 3.5 kW maximum output and it consumes a maximum of about 1 kW when it's in use. It it really warms the room up quickly when it starts up, but it soon settles down to a lower power mode to maintain temperature.

I think it's important that we try not only to switch away from fossil fuels but also to reduce our total energy consumption. The energy transition certainly won't be made easier if we try to achieve that transition by installing lots of electrical devices which consume enormous amounts of energy.

Once a house is well insulated it just doesn't need much heat input. At that point, an inexpensive air-air heat-pump like ours can keep your home at a comfortable temperature. Our heat pump and everything I needed to install it myself together cost significantly less than one year's average winter heating bill. The result of installing this device is that we no longer have a heating bill. Why would anyone not try to do this if they can ? We may now install a second one upstairs in the room where I work, but that's really a luxury: I've been fine this winter. If I didn't work from home I'd probably not be considering it at all.