‘Now is the time’ for mass heat pump market

Concerns arising from the energy crisis makes it an ideal time for heat pumps to become a mass-market product, an industry head has suggested.

Aimee Clark, Octopus Energy’s head of commercial, was speaking at Utility Week’s recent Future of Heat conference in which she discussed how to scale up heat pump installations from around 30,000 annually, compared to 1.7 million gas boilers.

Clark said it is very much “eco-warriors” who are willing to go above and beyond, to pay more to get a heat pump and have what is normally a “pretty shoddy experience”.

She said as well as installers not yet having the scale or bandwidth to optimise the processes, they do not have the incentives either as there has been quite a lot of money available through the Renewable Heat Incentive (RHI).

She continued: “Fast forward to now and energy is on the news every day, unfortunately. It’s really coming to the forefront of people’s minds. We also have the boiler upgrade scheme which makes it really simple for people and brings it to that cost parity.

“So now is the time to move into that mass market, but to do that we need to take a very different approach.”

Octopus has committed to train 1,000 engineers at its 24,000 square foot research and development centre in Slough, Berkshire, while also looking at ways to bring down costs and make heat pumps work for more homes.

Clark said Octopus is applying general principles that have worked for other sectors in the past.

“The first is on standardisation, so being really focused on those two to four bed mid-century homes with good insultation… We really have to focus on that so we can get really good at doing those mass market homes and pick the low hanging fruit.

“Then there’s optimisation. The good thing about heat pumps is that they were so poorly optimised in the past that there’s lots of opportunity to improve.

“When we started off observing third party installs, we saw 40% of the time people weren’t even being used because they’d have highly skilled people there but they didn’t have the parts on the day that they needed or they’d not got the right person for the job. So just being much more efficient about how you plan those processes has allowed us to really shave that down.”

Finally, she said, there is the question of how to make heat pumps more attractive to consumers.

Clark said when she first started at Octopus she emailed 1,000 customers asking if they wanted a heat pump. More than a quarter (26%) said yes.

“I was surprised by this because as a marketer you don’t get those kinds of responses for that big of an investment.”

Despite the good response, some consumers realised the process was complicated and were put off.

She added: “So I think the challenge for all of us is how do we make that as cheap and as easy as that gas boiler experience. Speed is another thing that I think is undervalued but really important because if we are going to move to the mass market where most people who buy boilers are in a distress scenario, we absolutely need to be able to respond quickly to that.”

Also speaking during the conference was David Watson, head of energy transition at gas distribution network Cadent, who stressed the importance of consumer engagement in the transition to low-carbon heat technologies.

Watson said it is important to recognise that while conference delegates understood the need for change, large parts of the population are not very engaged.

He said: “They might be generally aware that burning gas in a power station to make electricity is pretty bad for the climate. But that doesn’t mean to say that consumers are aware that burning gas in a boiler in their kitchen to make heat is also bad for the climate.

“More worryingly, when you advise consumers that gas heating is actually part of the problem and you present them with a range of low carbon alternatives, fewer than half of people are interested, regardless of the technology that’s offered. Even fewer have even heard of the technologies beforehand, whether that’s heat pumps or hydrogen boilers.

“In short, it’s easy to get a feeling from reading energy Twitter, as I do, that this stuff is all just common parlance…but the reality is that people are simply not engaged in energy beyond trying to work out how they are going to pay their next bill.”

He did however say that the sector is “not starting from square one”.

“Four in five people across the country are concerned about climate change and although that does make me worry a bit about the other 20%, there is a receptive audience out there. We just need to start,” he added.