commercialheatpumpinstallation

How much does a commercial heat pump cost? UK price per kW by building type

Real UK costs by heat-pump type and size, what actually drives the price, and the capital allowances and funding that change the net figure. Updated for 2026.

Indicative planning ranges, not quotes or sourced prices: the figures on this page are being tied to named public sources and will be updated when each is verified.

A heat pump is capital plant, not a running cost, so the sticker price is only half the picture — the net cost after tax relief and any grant is what belongs in the business case. The honest range is wide because no two buildings are the same: the same 200 kW output costs very differently in a building whose emitters already run cool than in one that needs a re-emittering programme and a DNO supply upgrade. The full installed cost, the tax position and the running-cost saving on a real SCOP should be modelled before any commitment.

Cost ranges by heat-pump type

Air-Source Heat Pump Installation

Typical heat output
40-500 kW thermal
Project value
£60,000-£600,000
Payback
8 years

Ground-Source Heat Pump Installation

Typical heat output
50-1,000 kW thermal
Project value
£150,000-£2,000,000+
Payback
11 years

Hybrid & Boiler-Replacement Installation

Typical heat output
60-400 kW heat pump + retained or new peaking boiler
Project value
£70,000-£500,000
Payback
7 years

High-Temperature & Process Heat Pump Installation

Typical heat output
100 kW-2 MW+ thermal
Project value
£200,000-£3,000,000+
Payback
9 years

Water-Source Heat Pump Installation

Typical heat output
100 kW-5 MW+ thermal
Project value
£300,000-£5,000,000+
Payback
12 years

Heat Network & Energy Centre Installation

Typical heat output
500 kW-10 MW+ thermal
Project value
£1,000,000-£20,000,000+
Payback
14 years

What drives the price

Cost driverCheaper when…More expensive when…
EmittersAlready run at 50-55 °CNeed widespread upgrades
Heat sourceAir-source, no ground worksGround or water-source (drilling, permits)
Electrical supplySpare capacity availableDNO supply upgrade required
SitingSimple compound, planning route confirmed with the local planning authorityAcoustic screening, listed-building consent

The hidden costs people miss are the emitter upgrades, the DNO supply contribution and any acoustic or planning work — all of which should be costed up front from the survey, so the itemised proposal holds.

Capital allowances and funding

A commercial heat pump is plant and machinery, and commonly an integral feature of the building, so it attracts the Annual Investment Allowance — 100% relief on up to £1m of qualifying spend a year (special-rate pool). On a £250,000 install that is up to £62,500 of first-year corporation-tax relief at 25%. Grant routes change quickly: PSDS has had no open application window since Phase 4 closed in November 2024 and gov.uk lists no further phase, so public bodies should check Salix for any successor, and the Industrial Energy Transformation Fund is closed with no successor planned (gov.uk, July 2025), and the Green Heat Network Fund's Round 12 closed on 25 September 2026, so check gov.uk for a later round. System-specific guides: the commercial air source heat pump guide and the commercial ground source heat pump guide. The £7,500 Boiler Upgrade Scheme can reach small non-domestic buildings (flat grant, up to 45 kWth), but not building-scale plant, and the 0% VAT relief is residential and charitable only. See capital allowances and grants and funding for the detail, and read whether it is worth it.

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Cost questions

How much does a commercial heat pump installation cost?

It depends on technology and scale: ground-source costs more than air-source because of the ground works, and water-source and heat-network schemes are larger again. Cost is driven by the peak heat load, the emitter upgrades required, external-plant siting, and any electrical supply upgrade. The full installed cost should be modelled from the heat-loss survey before any commitment, with no blind quotes.

How this guide works

  • Replies by email
  • Costs sourced to UK standards
  • Funding status checked against gov.uk
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