A study conducted by RWTH Aachen University and Octopus Energy found that the cost of purchasing and installing an 8 kW air-to-water heat pump in Germany is around €28,000, compared to €14,000 in the UK. The main reasons for the price difference are due to technical and regulatory requirements, including higher efficiency and sound insulation standards in Germany, which make installations more complex and expensive. Additionally, the VAT rate is 19% in Germany, while heat pumps in the UK are exempt from VAT. The study also found that the UK’s fixed subsidy of £7,500 (around €8,900) for heat pump installations is more efficient than Germany’s subsidy system, which is based on the cost of the installation. The CEO of Octopus Energy, Bastian Gierull, argues that the high costs in Germany are due to “artificially inflated” prices and calls for policymakers to reduce taxes, simplify subsidies, or phase them out. The study concludes that heat pumps in Germany are more expensive due to a combination of complex installation, high technical requirements, and different subsidy structures.
Germany’s heat pumps are roughly twice as costly as those in the UK, according to a report by pv magazine International.
