Despite a government target of 600,000 working units by 2028, pumps’ perceived high price and a shortage of trained fitters kept home installations as low as 35,000 in 2020.

Last month though, chancellor Sunak removed VAT on home fitting of the air – and ground-sourced varieties until 2027.

Octopus reckons that incentive, plus RED upping output to over 1,000 pumps a month, plus the government’s new Boiler Upgrade Scheme offering up to £5,000 upfront, now make heat pumps price-competitive with traditional boilers.

Extending, quietening and beautifying RED’s range to make the technology attractive in smaller homes, is Octopus’ route to success. Accelerated production at RED as early as this year will be followed by the creation of 100 skilled green jobs.

Founded by Dr. Jason Cassells, RED designs and manufactures patented air- and ground-sourced heat pumps, including their controls, software and onward distribution systems.  Eighty per cent of components come from the UK.

The partners in this ‘multi-million pound investment’ are also investigating more suitable locations to expand production further.

Greg Jackson’s Octopus already pumps £10 million into a centre in Slough, researching commercial ways to decarbonise heat in buildings.

With a focus on time-intelligent power-buying, the firm’s smart grid technology will enhance RED’s hardware.  Owners of EV and PV panels will benefit still more; the retailer believes on-roof solar could slash as much as 70% from a pump’s running costs.

Heat pumps are a key element in the Johnson administration’s plan for greener energy. Last week’s energy security strategy announced the launch of a Heat Pump Investment Accelerator Competition this year.  Worth up to £30 million, it is aimed at UK manufacturers such as RED, as their product cuts national demand for gas, thus increasing the country’s energy independence.

Energy minister Lord Callanan commented: “The Energy Security Strategy has laid out a future where we will be powered by homegrown renewable and nuclear energy and heat pumps using this cleaner, cheaper electricity will allow us to warm our homes.

‘Model T moment’ to make pumps afFordable?

“Together with private sector investment such as this by Octopus Energy, we’re making heat pumps an affordable, convenient and obvious choice for consumers – especially with global gas prices at record highs.”

Octopus founder and CEO Greg Jackson said: “I am absolutely thrilled that Jason and his team are joining forces with us.

“This is the “Model T” moment for the heat pump industry”, Jackson went on. “Thousands of heat pumps rolling out of RED’s Craigavon factory a month is just the beginning.

“Like the original Ford, we’re planning to scale production every year, cutting costs even further and making heat pumps affordable for everyone”.

Launched in 2016, Octopus sells low carbon energy to 3.1 million homes.  Across Europe the group manages a green generation portfolio valued at £3.4 billion.



  1. I would not touch Red heat pumps with a barge pole, we have one and when it comes to servicing our boiler, they refuse to do so.
    We have a heat pump which is non functional, a total waste of money, 2000GDP down the drain.


Please enter your comment!
Please enter your name here