The Short Answer
Storage heaters charge up overnight on cheap electricity and let the heat out during the day. Used well on Economy 7, heat costs about 18p a kWh (two to three times gas), and a three-bed typically spends £1,500 to £2,500 a year. They're not the cheapest way to heat a home, but they're far from the most expensive.
The cheapest switch is an air-to-air heat pump: about 5.7p per kWh of heat, so roughly £1,000 a year less on a £1,500 bill, and it qualifies for the £2,500 Boiler Upgrade Scheme grant because you're replacing electric heating. What you mustn't do is rip them out for plug-in or panel heaters while staying on Economy 7. That's the most expensive heat in the country. Price your own options below.
Storage heater calculator
What your storage heaters really cost, and what would be cheaper
The same heat priced six ways, on October 2026 rates.
Typical: £1,500 to £2,500 for a three-bed. Not sure? Take your winter bills and knock off about £30 a month for everything else.
How do you use them?
Your storage heaters on Economy 7
£1,500/yr
18.8p per kWh of heat. 75% at 14.19p, the rest at 32.65p.
Air-to-air heat pump
£456/yr
5.7p per kWh of heat. A++ unit, SCOP 4.6 at 26.32p.
Air-to-water heat pump
£600/yr
7.5p per kWh of heat. SCOP 3.5 at 26.32p.
Modern storage heaters on Snug Octopus
£822/yr
10.3p per kWh of heat. 90% at 8.57p overnight, 10% at 25.94p.
Electric radiators on a single rate
£2,099/yr
26.3p per kWh of heat. Every kWh at the 26.32p price cap.
Electric radiators left on Economy 7
£2,604/yr
32.6p per kWh of heat. Daytime heat at 32.65p, the trap people fall into.
The cheapest switch
Air-to-air saves about £1,044 a year
About £3,700 fitted (three-bed, Energy Saving Trust), or £1,200 if you get the £2,500 Boiler Upgrade Scheme grant in England or Wales. Against the whole bill that pays back in about a year with the grant.
Get heat pump quotesEconomy 7 and Snug rates are Octopus Energy's standard variable direct debit rates from 1 October 2026, averaged across all 14 regions (read from Octopus's public price data, 11 October 2026). Your supplier and region will differ by a few pence. Hot water and the standing charge are left out, as they barely change between these options.
How Storage Heaters Work (and Why They Run Out by Teatime)
Inside each one are heavy bricks that an element heats up while you're asleep, on the cheap night rate of an Economy 7 or similar tariff. During the day the bricks give that heat back, through the casing and, when you open the damper, a fan or flap.
The catch is timing. The heat is stored at night and released all day, whether or not you're in. Old storage heaters leak a lot of it in the morning, so by 6pm, when you actually want to be warm, they're tepid. That's when people hit the boost button (full daytime price) or plug in a fan heater (also full price), and the bill climbs.
The two dials, and how to set them
- Input (or charge) controls how much heat goes in overnight. Turn it up when the forecast is cold and down in mild weather. Most people leave it on maximum all winter and pay for heat they don't use on warm days.
- Output (or damper) controls how quickly it comes out. Keep it on minimum (or closed) until you need heat, then open it. Closing it at night and when you go out is the single biggest free improvement.
Don't touch the boost button unless you have to. It heats at the day rate, which on Economy 7 is more than the normal single rate.
What Storage Heaters Cost to Run
A storage heater turns every kWh of electricity into a kWh of heat, so the only question is what you pay for the electricity. On Octopus Energy's standard Economy 7 tariff from 1 October 2026 (direct debit, averaged over all 14 regions), that's 14.19p at night and 32.65p in the day. How the two blend depends on you:
| How you use them | Share on the night rate | Cost per kWh of heat |
|---|---|---|
| Almost never boost | 90% | 16.0p |
| Some evening boosting | 75% | 18.8p |
| Lots of boost and plug-in heaters | 60% | 21.6p |
For comparison, a gas boiler at 90% efficiency delivers heat at 8.86p a kWh, and the single-rate electricity cap is 26.32p. Your supplier's Economy 7 rates may differ by a few pence, and the times of your seven cheap hours depend on your region and meter, so check your bill.
The Economy 7 trap
Economy 7 is only cheap if most of your electricity goes in at night. The day rate is higher than a normal tariff (32.65p against 26.32p), so everything else you run, the kettle, the oven, the telly, costs more. If your storage heaters are gone, or you barely use them, an Economy 7 tariff is probably costing you money. Ask your supplier to switch you to a single rate.
Your Options, Cheapest to Run First
| Option | Cost per kWh of heat | On a £1,500 storage heater bill | Upfront |
|---|---|---|---|
| Air-to-air heat pump | 5.7p | about £460 | £3,700 for a three-bed, £2,500 grant |
| Air-to-water heat pump | 7.5p | about £600 | more, and needs radiators and a hot water cylinder |
| Modern storage heaters on Snug Octopus | 10.3p | about £820 | new heaters, get quotes |
| Keep what you have, used well | 16 to 19p | £1,300 to £1,500 | nothing |
| Electric radiators on a single rate | 26.3p | about £2,100 | cheap to buy, often under £200 a room |
| Electric radiators left on Economy 7 | 32.7p | about £2,600 | don't |
Same heat in every row: the £1,500 bill at 75% on the night rate is about 8,000kWh of heat. Rates as above.
1. An air-to-air heat pump (the best money)
It's a wall-mounted indoor unit with an outdoor unit, the same kit as air conditioning but run mainly for heating. An A++ unit makes at least 4.6kWh of heat from each kWh of electricity, and you pay the normal daytime rate, so heat costs about 5.7p. The Energy Saving Trust puts the cost at about £1,900 for one room and £3,700 for a three-bed.
Because storage heaters count as electric heating, you can claim the £2,500 Boiler Upgrade Scheme grant in England and Wales if you own the home. The gov.uk eligibility rules ask that you're replacing a heating system "such as oil, gas, electric or LPG". The installer has to be MCS certified for air-to-air specifically, which is still new, so ask. Most homes start with the living room, where storage heaters struggle most, and keep a storage heater or two for the bedrooms. Our air-to-air heat pump guide covers it in full.
The catch: it doesn't heat water. Keep your immersion heater on the night rate, or look at a hot water heat pump cylinder.
2. An air-to-water heat pump
The usual heat pump, with radiators and a hot water cylinder. Cheaper to run than storage heaters by a mile, and it does your hot water, but in a home with no wet central heating you're paying for pipework and radiators too. It makes most sense in a house you're renovating. The grant is £7,500. See what heat pumps cost.
3. Modern storage heaters on a smart tariff
New "high heat retention" storage heaters are much better insulated, so they hold the heat until the evening, and they have thermostats and timers instead of two dials. Pair them with a tariff built for them and the numbers change a lot. Octopus's Snug tariff charges 8.57p from 00:30 to 06:30 every night (its regional average from 1 October 2026) and 25.94p the rest of the day, so heat taken 90% overnight costs about 10.3p a kWh, not far off a gas boiler's 8.86p. The right choice for a flat where an outdoor unit isn't allowed.
4. Keep them, and use them properly
Turn the input down on mild days, keep the output closed until you need it, stop boosting, and draught-proof. A heated throw or electric blanket for the evening costs a few pence an hour and lets you keep the heaters lower (see our electric blanket guide).
What not to do: panel heaters on Economy 7
Electric radiators and panel heaters are cheap to buy and easy to fit, and they're more controllable than old storage heaters. But they turn electricity into heat one for one at the moment you want it, which means the day rate. On a single-rate tariff that's 26.32p a kWh. Left on Economy 7, it's 32.65p, and our example bill goes from £1,500 to about £2,600. If you do switch to panel heaters, switch tariff the same day. Our electric heater guide covers the plug-in kind.
Storage Heaters in Flats
Lots of storage heaters are in flats, which is where the choice gets narrower. An outdoor heat pump unit usually needs the freeholder's permission, and may need planning permission, so check your lease before getting quotes. If that's a no, modern storage heaters on a smart tariff are the next best thing, and insulating and draught-proofing matters more than usual.
Grants
- Boiler Upgrade Scheme (England and Wales): £2,500 for air-to-air, £7,500 for air-to-water, for owners replacing electric heating. Not means tested.
- ECO4 (Great Britain, to 31 December 2026): for lower-income households, and it can fund heating upgrades as well as insulation.
- Warm Homes: Local Grant (England, through councils), Home Energy Scotland and Nest (Wales): low-income routes that can include heating upgrades.
Check yours with our grant eligibility checker, or the heat pump grants guide.
Swap storage heaters for heat that costs a third as much
An air-to-air heat pump can cut a storage heater bill by around two thirds, and the £2,500 Boiler Upgrade Scheme grant applies because you're replacing electric heating. Free, no-obligation quotes from MCS-certified installers.
Get heat pump quotes