Heat Pumps vs CHP for Leisure Centres: Which Actually Wins in 2026?

If you’ve read our piece on the economics of leisure centre CHP, you already know the economics of combined heat and power still stack up on paper — a spark spread of 4 to 8, roughly 30% better overall efficiency than buying grid power and burning gas separately, and a 20–30% cut to the energy bill in a well-matched pool.

But every CHP conversation now ends in the same place: what about a heat pump instead? This is the question nobody selling you a “free” CHP unit wants to answer. So here it is, straight.

The one-line answer

CHP is the better bet for the next few years of cash savings. A heat pump is the better bet for the next fifteen years of a public building. The problem is that CHP contracts are fifteen to twenty years long — so you’re being asked to make a short-term-optimised decision on a long-term-locked asset. That mismatch, not the maths, is the whole story.

Head to head

Dimension	CHP (gas)	Heat pump (electric)
How it works	Burns gas on site; makes electricity and recovers waste heat for the pool	Moves heat from air/water/ground into the pool using electricity
Efficiency metric	~30% overall gain vs separate generation + heat; depends on spark spread (4–8 healthy)	SCOP — real-world seasonal efficiency; a good pool install exceeds 4 (4+ kWh heat per kWh electricity)
Carbon trajectory	Fixed to gas; gets worse relative to the grid every year as the grid decarbonises	Gets cleaner every year automatically as the grid decarbonises
Capex	Often “no capex” via third-party ownership + long gas offtake	Higher upfront; but PSDS grants can cover the majority for public bodies
Grant eligibility (2026)	Fossil fuel — excluded from PSDS Phase 4	Eligible — PSDS Phase 4 funds low-carbon heat, 2025/26–2027/28
Contract lock-in	15–20 year gas offtake; decisions cede to the financier	Own the asset; own the savings; own the replacement decision
Best when	High, steady, simultaneous heat + power demand and you need savings now	You’re refurbishing, chasing net zero, or the existing plant is end-of-life

Why the timing has flipped against CHP

Three things have changed the calculus, and none of them are about whether CHP “works”:

1. PSDS Phase 4 excludes fossil fuels outright. Buildings qualify only when replacing end-of-life fossil plant with low-carbon heat, applicants fund at least 12%, and no gas-burning project is eligible. Sign a 15-year gas CHP deal and you’ve disqualified yourself from the main public-sector heat grant for the life of that asset.
2. The grid keeps getting cleaner; your gas engine doesn’t. A heat pump’s carbon case improves every year on its own. A CHP’s gets relatively worse. Over a 15-year term that gap compounds.
3. The savings are real but front-loaded. CHP saves most in years 1–5 while the spark spread holds. A heat pump costs more today but doesn’t lock your building’s future to a single fuel.

The proof heat pumps aren’t theoretical

Councils are already doing this at scale. Cotgrave Leisure Centre cut annual emissions from 376,870 kg CO₂e in 2023 to 68,572 kg CO₂e in 2025 — an approximately 82% reduction — after a PSDS-funded decarbonisation. Wiltshire, Rushcliffe and others have installed pool heat pumps to hit 2030 carbon-neutral targets. The technology is proven for exactly the steady, year-round heat demand a pool represents.

That does not mean every pool should rip out CHP tomorrow. It means the default question has changed. The decision is no longer “can CHP save money?” It can. The decision is whether that saving is worth a 15-year gas lock-in when the main grant route, the grid trajectory and council carbon targets are all moving in the other direction.

So which should you choose?

Choose CHP if: your plant has years left, you have no near-term refurbishment window, cash savings now outweigh carbon exposure later — and you buy the asset outright rather than signing a long gas offtake.

Choose a heat pump if: your plant is end-of-life, you’re refurbishing anyway, you have a net-zero commitment, or you can access PSDS. In most public leisure settings in 2026, this is now the default.

The trap to avoid either way: a “no-capex” 15-year gas offtake that makes the short-term decision for you and forecloses the grant-funded low-carbon route.

The decision nobody should make on assumption

Both technologies are sized well or badly on one thing: your actual metered demand. Most CHP sizing is done on assumption; most heat-pump feasibility is done on a spreadsheet. Neither is safe without 12 months of your half-hourly data.

Run the basics first as well: reduce demand before choosing the heating technology so the system you size is not compensating for avoidable waste.

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Sources to cite on-page

• PSDS Phase 4 eligibility and timeline — Salix Finance / GOV.UK
• Cotgrave carbon figures — BFM Magazine / Leisure Energy
• SCOP vs COP — Lochinvar
• CHP economics — Centrica Business Solutions and Telnergy’s leisure centre CHP article