I have been planning to fit an oil boiler in my house, however I am not
all that happy about the running costs. I have considered a heat pump,
but I am not sure that the up-front outlay is worth the extra economy.

What I am very confused about is how much it would cost to run a heat
pump - googling this group gives two conflicting opinions:

1) Oil is now so expensive that it costs about the same to run as
electricity for CH + DHW.

2) Although a heat pump runs between 300% and 400% efficiency they use
"expensive" electricity and so when you compare overall running costs
it would be just as cheap to run oil.

How can both of these be true?

If my house requires 40,000kWh per year (rough stab) for CH + DHW and I
get this all by off-peak electricity at 3.07p + VAT per kWh (ZEST4
online) it would cost £1289.40 per year to run.

If I get the same amount of heat from a heat pump, and pay 7.23p + VAT
per kWh (Scottish Hydro standard rate) the break-even point for
efficiency is when the system uses 16,985kWh of electricity which is
235% efficiency. If I could manage an avaerage of 300% efficiency I
would save about £277 per year.

Assuming an oil system at 33p per litre and about 10.5kWh per litre and
an 80% efficient system... this gives £1587 for 40,000kWh! (Yikes)

So, I guess the big question is how much would it cost to install a
heat pump system? If it costs less than about £3000 more than an oil
system it looks like it would pay for itself in 5 years.