Which is cheaper: gas or electric?
If you're looking to save money on your energy bills, it's handy to know just how expensive gas and electricity are - and how gas and electric heating systems compare. Let's look at the two side by side.
Key takeaways
Gas heating can be cheaper if you already have a modern gas boiler and use energy-saving measures
It might be more economical to keep your electric heating system instead of installing a new gas-based one, as the initial and maintenance costs for gas central heating systems are quite high
Gas ovens are cheaper to run compared to electric ovens but electric appliances like microwaves and air fryers can be more energy-efficient
Better insulation is crucial for maximising the efficiency of any heating system
Gas vs electricity: what’s the difference?
This is an important question to consider when it comes to heating your home, running your appliances and keeping your energy bills down.
Gas systems use a gas boiler to send hot water to connected radiators, taps and showers, and often also supply heat to cookers and ovens.
Electricity, meanwhile, has the capacity to power everything in the home, from your TV to your kettle, while also offering electric heating through devices such as storage heaters and electric radiators.
While not all homes are connected to a natural gas supply, electricity is available to just about every home and is more versatile.
Is gas cheaper than electricity?
On the face of it, gas is significantly cheaper than electricity. The current energy price cap, due to run until September 2024, puts the cost of gas at 5.48p per kWh (kilowatt hour), while electricity costs more than four times as much, at 22.36p per kWh.
As of October the energy price cap is due to rise again, but with the same disparity in unit rates between gas and electricity. This will take gas prices to 6.24p per kWh and electricity to 24.50p per kWh.
Standing charges are higher for electricity too, with a comparable impact on your energy bills. Under October's cap, the daily standing charge is 60.99p for electricity and 31.66p for gas.
However, there are other factors beyond the unit rates and standing charges imposed by the energy price cap to consider when looking at your energy bills.
Gas boilers and gas heating systems are inefficient compared with electric heating systems, while having an Economy 7 or Economy 10 meter installed by your electricity supplier means that you can slash the cost of electricity for seven or ten hours during off-peak hours, usually overnight.
This isn’t an option for gas - meaning gas heating costs the same at all times of the day.
It’s also worth remembering that gas boilers require regular maintenance and can be expensive to repair and replace when the time comes.
Is it cheaper to heat my home with gas or electric?
If you already have a modern gas boiler installed, then it's usually slightly cheaper to use a gas central heating system than an electric heating system.
However, this requires being smart, and taking energy-saving measures such as switching off radiators in rooms you are not using.
You can also save money by turning down the temperature on your thermostat. Even doing so by a single degree can make a difference, regardless of what heating system you use.
Electric heaters (and electric boilers) have improved greatly in recent years, however. And it’s also worth remembering that, if you don’t have one, installing and maintaining gas central heating systems requires a large outlay.
It may be more cost efficient to retain your electric system rather than installing a new gas-based one.
Is it cheaper to cook with gas or electricity?
Gas ovens are much cheaper to run compared with electric ones. However, this only tells half of the story.
That's because ovens tend to need to be left on for longer, while electrical appliances such as microwaves and air fryers can often do the same job in much less time, using less energy in the process.
Those with electric ovens should make use of the internal fan if it has one, as this means you don’t need it turned to a higher heat, saving money in the process.
It’s also a good idea to batch-cook lots of food at once and freeze it, thereby limiting your oven use.
Electric-based induction hobs are also as speedy and adaptable as gas cookers and are easier to clean too.
Gas fires, electric heaters and wood burners
While electric heaters may not be aesthetically pleasing, they tend to be portable, require less cleaning, and can be quickly turned off and stored away when not needed.
There are also options for creating an electric central heating system, with an electric boiler and central controls much like a classic gas central heating system.
Storage heaters, another type of electric heating system, have similar advantages.
Meanwhile, although gas fires have cheaper running costs, like boilers they cost a lot to install.
Wood burners look great, but are far more expensive to run, especially during colder spells.
It’s also worth remembering that some local authorities are planning on limiting their installation and use due to environmental concerns.
What’s the greenest way to heat my home?
With the government banning the installation of gas boilers in new-build homes from 2025, and an increasing understanding of the detrimental impact on the environment from gas heat, green options, such as solar panels and heat pumps, are becoming increasingly popular.
Heat pumps are seen as the future of green heating. Powered by electricity, heat pumps gather up heat in the air and ground surrounding your home, using it to warm the inside of your property as well as your water. They're considered better in terms of energy efficiency.
Biomass boilers are also having a moment, using wood pellets, chips or logs instead of gas.
Currently there are grants of up to £5,000 available from the government for those who want to replace an old gas boiler with a heat pump or biomass boiler.
This, in theory, lowers the cost to around the same as installing a new gas heating system, making it potentially cost effective.
It’s vital to remember that such systems only work to the best of their ability when paired with better insulation throughout the home.
Doing this will save you money in the long term, but the initial cost can be prohibitively high if you don’t have the cash to hand.
In the meantime, you may be able to get a green energy tariff from your supplier. In short, these mean that the energy you pay for comes from green sources, such as solar and wind power.
Switching energy suppliers with MoneySuperMarket
In normal circumstances, switching has been the best way to save money on energy bills. That applied whether you were looking for an electricity-only tariff, a gas-only tariff or a dual fuel deal
But as the world lurched from crisis to crisis and energy prices soared in recent years, latterly that’s not been the case.
That’s because suppliers responded to sky-high wholesale energy prices by withdrawing tariffs for new customers, while those available for existing customers were likely to be even higher than you’re paying on your current STV.
In turn, MoneySuperMarket and other price comparison sites were forced to suspend switching because we could no longer save our customers money.
With clear signs that conditions in the energy market are improving at last, we’re now able to offer a limited switching service that may be able to save you money or allow you get the peace of mind knowing you’re insulated by a fixed rate.
