Octopus Energy ad banned over heat pump cost claim

Western Telegraph

3 days ago

The Facebook ad, seen in September, said 'Installs from £500' and continued: 'The government grant covers up to 90% of the costs of a new heat pump. Replace your old broken boiler with an award-winning energy supplier and help stop our reliance on gas.'
The banned Octopus Energy advert (ASA/PA)
The Advertising Standards Authority (ASA) received two complaints, including from the Energy and Utilities Alliance trade body, which challenged whether the 'installs from £500' claim could be substantiated, and whether the ad omitted material information.
Octopus told the ASA that the claim was based on what their customers would pay, rather than the industry average cost of heat pumps.
The firm provided sales data from April 2024 to January 2025 that showed 13.9% of consumers who purchased a heat pump through Octopus Energy paid £500 or less.
In those cases, the total cost of installing a heat pump was £8,000, which, when the £7,500 Bus (Boiler Upgrade Scheme) funding was deducted, gave a final cost of £500.
Octopus said they targeted the ad at consumers in their installation coverage area, which accounted for around 86% of postcode districts.
They referred to a consumer opinion survey they had commissioned from a third party after receiving notification of the complaints from the ASA, to see what people understood from the claim, finding that 58% of respondents understood that the cost of having a heat pump installed by Octopus Energy could be as low as £500 with help from government funding.
The ASA said advertising regulations required that price claims such as 'from' must not exaggerate the availability or amount of benefits likely to be obtained by the consumer.
Competition and Markets Authority guidance similarly stated that 'from' prices should reflect what a significant proportion of consumers were likely to pay for the advertised product.
We had not seen sufficiently robust evidence that a significant proportion of consumers to whom the ad was targeted could purchase a heat pump and have it installed by Octopus Energy for £500. We therefore concluded the ad was likely to mislead ASA
The ASA said consumers would understand the claim 'Installs from £500″, in the context of the ad, to mean that a significant proportion of consumers could purchase a heat pump and have it installed by Octopus Energy for £500.
However, its assessment of sales data showed that at the time the ad appeared, in September 2024, 5.8% of heat pump sales had been made at or below the price claimed in the ad.
In the preceding months for which Octopus held data, less than 5.8% of sales made had been at or below the claimed price.
For the final two months of 2024, the proportion of heat pumps sold at or below £500 stood between 23% and 24%. However, the data did not show that a significant proportion of sales, at the time the ad appeared, were at the claimed price of £500.
The ASA said: 'We therefore considered the price did not reflect what a significant proportion of consumers were likely to pay at the time the ad appeared.'
It added: 'We had not seen sufficiently robust evidence that a significant proportion of consumers to whom the ad was targeted could purchase a heat pump and have it installed by Octopus Energy for £500. We therefore concluded the ad was likely to mislead.'
The ASA ruled that the ad must not appear again in the form complained about, adding: 'We told Octopus to ensure that suitably robust evidence was held to demonstrate that any claimed 'from' price could be achieved by a significant proportion of consumers.
'We further told them to ensure ads making price claims for heat pump installation included all material information, including clarification of any government grant included in the advertised price, and the existence of eligibility criteria.'
Rebecca Dibb-Simkin, chief product and marketing officer at Octopus Energy, said: 'We disagree with this ruling. 13% of all heat pumps sold by Octopus during the campaign were £500 or less, exceeding the ASA's guideline of 10%.
'This clearly has the fossil fuel lobby worried, which is why they are relentlessly pressuring the authorities to undermine the clean energy sector.'