Dale Vince, a leading Labour donor, has said that heat pumps don’t “save you money” because they’re inefficient and are being “mis-sold” by the Government. The Telegraph has more.

Heat pumps, which are promoted as a green alternative to traditional gas boilers, form a key part of Ed Miliband’s £15 billion energy plan, which was announced last week.

It aims to install solar panels, heat pumps, double glazing and insulation in five million low-income households, at a £5 billion cost to the taxpayer. Landlords also face a bill of up to £10,000 by 2030 under energy efficiency plans designed to push through upgrades.

But speaking to BBC Politics Live on Tuesday, Vince, the founder of energy firm Ecotricity, said: “I have been using heat pumps for about 20 years, so I know what they can do and what they can’t do.

“I do object to the fairly general narrative that they can save you money, because that is a very rare circumstance. You do need a well-insulated home just to break even.”

Vince, who has in the past funded activist groups including Just Stop Oil, said that to be cost-effective, a heat pump needs to have a coefficient of performance of at least four. Coefficiency performance is the measurement of how much heat is produced per unit of electricity used.

He claimed that for heat pumps in the UK, the average was just 2.8, which meant homeowners tended to see their bills increase by 30%.

Vince said: “That’s the reality. Against that, we have got the mis-selling, I think, of heat pumps.”

The Department for Energy Security and Net Zero (DESNZ) said that households which installed a heat pump, solar panels and a battery could save as much as £550 a year compared with a gas boiler. A spokesman said that heat pumps can save households as much as £130 a year.

Analysis by the Energy Saving Trust found that those with a newer gas boiler may not see annual savings from installing an air source heat pump. The cost of installing a new heat pump has remained at approximately £13,000, although homeowners can benefit from government grants to reduce the upfront cost.

Read More: Dale Vince: “Heat Pumps Have Been Mis-Sold”