Which Heat Pump Works Best for your SME?

  • 22 Nov 2023

As climate change necessitates urgent action, the UK’s small and medium enterprises are increasingly adopting heat pumps as a sustainable heating and cooling solution. Most business owners and decision makers aren’t going to be experts in heat pump technologies, and Clade Engineering’s Chief Markets Officer Tim Rook knows this. In this article, he delves into the various options available, including the latest in propane heat pumps, offering detailed guidance for SMEs in their decarbonisation journey…

The Decarbonisation Imperative

The UK’s commitment to achieving net-zero carbon emissions by 2050 places a significant onus on businesses, particularly SMEs, to reduce their carbon footprint. Heating and cooling systems are pivotal in this transition, with heat pumps emerging as a sustainable alternative to traditional heating methods.

Adoption is growing in the UK, with heat pump sales nearly doubling in 2021, reaching 55,000 units. The UK government doesn’t plan to allow this progress to slow, either; the Energy Security Bill – introduced to Parliament in the summer of 2022 – aims to have 600,000 heat pumps installed, per year, by 2028​​​. What’s more, the Heat and Buildings Strategy plans to reduce heat pump costs by 25 – 50% by 2025, achieving cost parity with boilers by 2030.

This strategy is crucial for widespread adoption and aligns with the government’s decarbonisation goals – but it’s important for businesses to understand what solutions are available, and which will work best for them.

Types of Heat Pump

While the market for heat pumps is growing, challenges like a lack of awareness and high upfront costs persist. Energy retailers are well-positioned to educate consumers and offer tailored financial packages to encourage adoption, so if you have any questions relating to heat pumps, they’re a good place to start. There’s also the government’s UK Business Climate Hub, which offers further information and support.

On the subject of which heat pump would work best for your business, there are a few options available. Ultimately, the one you choose will depend on a few different elements…

Air Source Heat Pumps (ASHP)

ASHP’s are widely popular to their cost efficiency and ease of installation. They are particularly ideal for retrofitting existing buildings​​, and can range in cost between £7,000 and £13,000, offering up to £1,500 annual savings on heating bills. They’re less efficient in extreme cold, but are well-suited to the generally moderate UK climate.

Ground Source Heat Pumps (GSHP)

With higher upfront costs (around £24,000 to £49,000), GSHPs require more space and initial investment, but offer greater efficiency (CoP of 4.8) and can save significant CO2 emissions annually. They are an appealing long-term investment, especially in shared-loop heat networks for multiple properties​​. They require more installation space, but have lower operational costs​​​​.

Water Source Heat Pumps (WSHP)

Ideal for businesses near water sources, WSHPs have a high CoP of around 6 and can save £395 – £2000 annually. They offer similar efficiency to GSHPs, but necessitate water access and can involve complex installations.

Hybrid Heat Pumps

Hybrid heat pumps combine a standard heat pump with a fossil fuel boiler, ideal for UK properties with high heating demands, especially where a single heat pump isn’t enough. They automatically adjust operations based on energy costs and are particularly effective in large, hard-to-insulate properties.

Propane Heat Pumps

Propane heat pumps, using environmentally friendly R290 refrigerant, are suitable for businesses prioritising low environmental impact. These pumps offer efficient heating and cooling with a low Global Warming Potential. Ideal for diverse applications, they meet sustainability standards and are future-proof against regulation changes, making them a practical choice for UK businesses​.

Things to Consider When Selecting a Heat Pump

Choosing the right heat pump for your SME requires careful consideration of several key factors. These aspects will significantly influence your heating system’s efficiency, cost, and environmental impact. Here are the crucial elements to assess:

Space Availability: The choice between ASHP, GSHP, WSHP, and propane heat pumps is significantly influenced by available space. ASHPs are typically more compact and adaptable for limited spaces.

Energy Efficiency: Efficiency is key for cost-saving and performance. Propane heat pumps stand out for their high COP values, indicating superior efficiency.

Cost Considerations: Initial costs for heat pumps vary widely, from £8,000 to £45,000, influenced by the type and installation complexities. While ASHPs present a lower upfront cost, GSHPs and WSHPs can yield more substantial long-term savings and ROI due to their higher efficiency, despite the greater initial investment.

Heat Pumps

Government Incentives: Incentives such as the Renewable Heat Incentive (RHI) scheme and enhancements in the Boiler Upgrade Scheme are pivotal in making sustainable heating technologies more attainable.

Environmental Impact: Opt for systems with lower carbon emissions to align with decarbonisation goals. The environmental footprint of the heating system is a crucial consideration, especially in the context of the UK’s net-zero targets.


Heat pumps are a critical component of the UK’s decarbonisation strategy, especially for SMEs. Understanding the types, efficiencies, costs, and incentives allows business owners to make informed decisions. With government initiatives and market growth trends supporting this transition, SMEs are encouraged to consult with experts and use available tools to select the best heat pump for their needs. With the right help, your business can increase contributions towards the country’s targets for Net Zero emissions.

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