How much money can you save with a new boiler?

Investing in a new boiler may seem expensive, but the savings you can make on your energy bills make it worth the money. (Image credit: Adobe)

More families are facing fuel poverty every day, yet the cost of living climbs higher, leading homeowners to research how to save money on heating bills. Fortunately, there are many ideas to save on household bills but if you have an inefficient boiler, you could be losing hundreds of pounds every year. 

We look at the four most common boiler types and how much money you can save on your energy bills by investing in a new one.

Your boiler is at the heart of your home heating system, sending hot water to your taps and around your radiators. The white metal unit, often situated in the kitchen, houses the small furnace. Fuelled by gas, oil or LPG, this heats the water, which escapes into the pipes that feed your central heating. 

With the majority of boilers in the UK, when you switch on your heating, an electric ignition switch lights a series of flames fed by gas from the mains supply. The flames are directed at the heat exchanger, which transfers the heat to the cold water pipe. In turn, the cold water is rapidly heated to around 60°C. 

An electric pump then pushes the hot water around a circuit of pipes that pass through your radiators, upstairs and down, radiating heat. Once the water has completed the circuit, the boiler will reheat the by-now cooled water if necessary. The same water travels around the closed system until a professional Gas Safe engineer drains it. 

There are four main types of boiler in the UK:

• Combination boilers
• Heat-only/conventional boilers
• System boilers
• Biomass boilers

Combination boilers

The combination, or combi, boiler is the type most commonly installed in UK properties. Having two heat exchangers and a two-pipe hot water circuit – one to feed the radiators and one to feed hot water to your taps, the combi boiler can produce hot water on demand. The cold water is delivered straight from the mains and heated, so there’s no need for a bulky feed tank in the loft or a storage cylinder.

Heat-only or conventional boilers

Fed cold water from a large tank in the loft, a heat-only model, also known as a conventional boiler, only produces hot water for your heating system. As a result, there needs to be an insulated hot water storage cylinder, often installed in a cupboard, to store hot water for your taps and showers.

System boilers

System boilers are very similar to the heat-only boiler in that a storage cylinder is necessary to store hot water for your household’s needs. However, as the boiler is supplied with high-pressure cold water directly from the mains, a loft feed tank isn’t required.

Biomass boilers

A biomass boiler uses organic matter, usually wood or wood pellets, to create heat and hot water. As a result, they tend to be much bigger than other boiler types and are often housed in a cellar or outhouse. However, they are becoming more popular due to their sustainability.

If your boiler is over eight years old, is less than reliable or is not working, it’s time to look at getting a replacement. Heating your home accounts for over 50% of your energy bill, so having an efficient boiler can significantly help your household budget.

Costs vary depending on the boiler model and system type but expect a new combi boiler to cost between £600 and £2,000. A heat-only or system model could set you back from around £500 to £2,500. 

Like other household appliances, boilers are given an energy efficiency rating. A-rated boilers perform at more than 90% efficiency, while at the lower end of the scale if your boiler is rated at G, it’ll run at 70% or less. According to British Gas, upgrading from a G-rated model to an A could save you £580 or more a year.

Upgrading an old boiler to a new, energy-efficient boiler is one way to save money on your heating bills. (Image credit: Adobe)

The type of boiler you get depends on several factors:

• The size of your household
• Whether you need hot water instantly
• How much space is available for a boiler
• Your existing system

A combi boiler works well for most properties and is the type most homeowners choose. It provides unlimited heat and hot water on demand and doesn’t require loft space for a cold water tank or an immersion cylinder. However, if several people need hot water simultaneously, it may reduce the water pressure. 

If your family require multiple taps to be running at the same time, a heat-only boiler may be the best choice. It’s worth bearing in mind, though, that you’ll need to find the space for the cold water tank and immersion cylinder, and it takes a while to reheat more water once you’ve used it all. A system boiler could also suit this situation, and as the cold water comes directly from the mains, there’s no need for a large loft tank.

Boilers, in general, are an energy efficient way of supplying your home with heating and hot water, saving you money and reducing carbon emissions. However, there are a couple of disadvantages to take into consideration. 

Boilers have large space requirements. If you choose a combi boiler that takes its water directly from the mains supply, you’ll have hot water and a warm home without a cold water feed tank or an immersion heater. However, with the system boiler and heat-only models, you’ll need an immersion cylinder and in the case of the latter, a cold water tank in the loft. In some cases, the loft floor needs to be reinforced to hold the weight of the tank. 

With combi boilers, you’ll lose hot water and heating if the boiler breaks down, while the conventional type will still provide hot water. System boilers can rapidly run out of hot water if you have a large demand, leaving the household waiting for more hot water.

The government has committed to making the UK carbon neutral by 2050, and a big part of that is helping people pay for energy efficient appliances, including boilers.

Boiler Upgrade Scheme

The Boiler Upgrade Scheme (BUS) is only available to households in England and Wales and provides financial help towards improving your heating system. If you own your home, you could be entitled to £5,000 off the cost and installation of a biomass boiler – unfortunately, it doesn’t cover other types of boiler. Landlords and owners of second homes are eligible.

Energy Company Obligation

The Energy Company Obligation (ECO) scheme is designed to help vulnerable UK households afford energy efficient upgrades, including new heating systems. You may be eligible if you receive one of these benefits: 

• Child Tax Credit
• Working Tax Credit
• Universal Credit
• Pension Guarantee Credit
• Pension Savings Credit
• Income Support
• Income-based Jobseeker’s Allowance (JSA)
• Income-related Employment and Support Allowance (ESA)
• Child Benefit
• Housing Benefit

Contact your local council to apply, or contact your energy supplier directly.

A new boiler installed in your home can add thousands to its value. According to GoCompare’s Property Investment Calculator, a new boiler can increase your property’s value by £9,000.

An average household upgrading from a G-rated boiler to an energy efficient A-rated model could save as much as £580 a year on their energy bills after the price cap rises in October 2022.