How Tim saved money on energy bills with solar panels and an air source heat pump

Although he did have the environment in mind, cost saving was the main objective behind Tim’s energy efficiency measures. “I’d been monitoring what was going on with solar and was aware of air source heat pumps, and was keeping an eye on it,” he says.

When he had a new extension built in 2015, Tim added a 2.4 kW eight-panel solar system to the roof. But it wasn’t until the Covid-19 lockdown in 2020 that he had more time to think about things. As a result, he got an air source heat pump fitted that summer to replace his old oil boiler.

While some installers were interested in doing the proper heat loss calculations, Tim says that other just made assumptions based on the size of the house.

As a result, the quotes he received varied enormously. “I think it might have been a 50% difference in price between the cheapest and most expensive.”

Tim chose one of the lower cost companies, an MCS certified installer whose advice and calculations he trusted. “Looking back, I think I was doing it from a very ill-informed base that actually worked out. It was a bit more luck than judgement,” he admits.

Being a listed building, it needed planning permission. Tim applied for this himself with sketch drawings based on other plans used for the extension, which were accepted by planners.

The Renewable Heat Incentive (RHI) grant required an energy performance certificate (EPC), despite listed buildings usually being exempt from for other purposes.

The house already had a modern mains pressure hot water tank. However, this had to be replaced with one that was compatible with an air source heat pump.

The installers also recommended changing three upstairs radiators for larger ones, but Tim decided to replace just one. “The bedrooms are not hot, but they’re okay,” he says. “As for downstairs, it can easily reach a comfortable 21°C with the benefit of existing underfloor heating.”

The heat pump installation was quick and simple. “A team of two plumbers were here for two or three days, and then an electrician came separately,” Tim recalls. Because it was summer, they didn’t have to worry about being cold while the heating was off.

When it came to fitting the solar panels the following year, Tim says “the disruption wasn’t significant. It only required the power to be off for a very short period of time when the final connections were made.”

Tim’s biggest issue was that the installer didn’t tell him about weather compensation. This enables heat pumps to save energy by adjusting the temperature of water sent to the radiators in response to the temperature outside.

After learning about weather compensation through online forums, Tim optimised the system. He did this initially with some changes in the controller installer menu. This was followed by further small changes over two winters to see the full benefit. This brought down the heat pump’s energy use by more than a quarter.

Tim says, “I think, typically, when users complain about air source heat pumps not delivering enough heat, they’re not understanding how they’re supposed to work. You need to work in a different way, operating 24/7, not using it like a traditional gas or oil boiler and turning it on and off.”

An additional mistake in the installation was placing the controller in a warm bathroom. This meant it could not detect internal temperature to aid weather compensation. Despite this not being ideal, Tim hasn’t felt it necessary to move it.

Thinking about his solar experience, Tim says, “one of the main points to remember is that solar is producing the vast majority of the electricity in the summer, when you don’t need it for the air source heat pump – and much less in winter, when you do need it.”

Some of the excess electricity is stored in batteries, and Tim sells the rest back to his energy supplier at a rate of 15p per kW. When his home needs more energy than the solar panels can generate, he buys electricity at a cost of around 12p per kW.

Tim estimates that the total energy generated by his solar panels is worth over £900 a year, although he only sells around 40% of this back to the supplier.

Tim achieves average electricity costs of around half the standard rate by making effective use of smart time of use tariffs. “I’m able to time shift and charge the batteries at cheap slots at night,” he explained.

He’s also chosen a tariff where rates change frequently based on wholesale energy prices. By monitoring the market, Tim can charge his car and batteries when costs are at their lowest. He estimates that this careful use of variable tariffs saved him £1,200 in 2024.

But there is a limiting factor. “One downside to the system I’ve got is that the inverter [which turns solar energy into usable electricity] will only charge and discharge with the batteries at 2.6kW per hour,” Tim says.

This means that the batteries charge and discharge relatively slowly, and so it also restricts the amount of energy the heat pump can use from the batteries.

Tim spent around £12,000 on the air source heat pump, including a new hot water tank, radiator and installation costs. Most of this cost will be paid back by quarterly payments over seven years from the RHI, which has since closed to applications. However, other funding like the Boiler Upgrade Scheme is now available. His 16-panel solar system, including three batteries, also cost around £12,000.

In 2024, Tim’s home used 12,780kW of electricity. Of this, 5,741kW was used by the air source heat pump, 1,652kW charged his car, and the rest powered lighting and appliances. His solar panels generated a combined 6,580kW of electricity, equal to around half of Tim’s home’s total energy consumption. Because much of this power was produced during the summer when he didn’t need it, 2,678kW of it was automatically exported to the grid.

Was it a worthwhile investment? “Absolutely,” Tim says. “Probably actually better than I expected.” But making the most of smart time of use (ToU) tariffs has been crucial to his success. “If I was looking at it purely in terms of the solar and batteries and staying on standard tariffs, the investment probably wouldn’t stack up very well.”

However, it’s good to remember that installations are often not a case of one size fits all. The setup (including all its technologies like solar, heat pumps, EV, etc), the energy demand from a home, heat loss, and choosing the right tariff all matter.

Tim’s tips to anyone looking to install similar energy efficiency measures are:

• Make sure you get accurate heat loss calculations done to work out the size of heat pump you need for maximum efficiency. Oversizing is just as bad as undersizing.
• Consider noise and your neighbours when deciding where to put your heat pump. They’re not especially loud, but they’re not silent either.
• Ask your installer to educate you on weather compensation and set up the heat pump to work in this way.
• With solar, use batteries to make the most of smart time of use tariffs and save more money. Consider standalone batteries if not solar.
• Investigate smart time of use tariffs if they’re more suitable.
• Discuss options with your battery installer to understand the restrictions of the inverter size. Although higher rate inverters can cost more, you can make greater savings through smart time of use tariffs.
• If you get batteries, think about getting an emergency power supply set up as part of the system. This will let you run your home on batteries during a power cut.

Tim is happy with the home energy efficiency measures he has in place for now.

In future, he says he might consider replacing the inverter and batteries “to improve the whole emergency power supply side of it, as well as the ability to make best use of time of use. But I don’t see that happening until further down the line.”

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