High Electricity Costs Hinder Irish Heat Pump Adoption; Iran War May Raise Retrofit Prices

High electricity costs are the primary barrier to heat pump adoption in Ireland, according to Ciaran Byrne, director of retrofitting at the Sustainable Energy Authority of Ireland (SEAI). While rising oil and gas prices, exacerbated by the US and Israel's actions against Iran nearly two months ago, are prompting homeowners to consider retrofitting, the conflict is also expected to drive up construction costs, impacting the retrofit industry.

Byrne noted that shipping and truck transportation costs have already increased, and packaging prices for products like windows are likely to follow, affecting consumers. Despite this, the sector may see some protection as many retrofit products are not energy-intensive to manufacture. Ireland is significantly behind its target of installing heat pumps in 400,000 existing homes by 2030.

Heat pumps, which typically cost €12,000 to €18,000, are essential for achieving an A-rating on the Building Energy Rating (BER) scale. The SEAI grant recently increased to €12,500, but most Irish homes require extensive insulation work to qualify. Byrne emphasized that while grants have been increased, electricity costs remain the major hurdle, a problem he identifies as European, linked to market regulation and electricity pricing frameworks.

The SEAI is exploring solutions, including trialing high-temperature heat pumps that integrate with existing central heating systems, eliminating the need to replace radiators and pipework. They are also working on low-cost loans and streamlining grant processing to encourage more retrofitting. A pilot project for homes built before 1941 could expand retrofit options for 250,000 to 350,000 Irish homes.