There are few more important appliances in your home than your boiler. This unassuming appliance not only provides you with hot water but also generates much-needed heat to keep you warm in the cold winter months.

But as anyone who has examined their energy bill knows, gas or oil fired boilers are also incredibly expensive to run. The Energy Savings Trust estimates that central heating boilers are responsible for around 55% of your energy bill each year. With energy bills running at £49 per month for the average household, this represents around £323 per year.

So it is important that homeowners ensure their boiler is running efficiently if they are to keep energy costs to a minimum. Regular maintenance can help, but with technology improving all the time, a boiler produced today is more efficient than one produced as little as 10 years ago. Which begs the question, when is the best time to replace your boiler?

New boiler technology

If you are installing a new gas boiler today you are almost certainly going to be installing a condensing boiler. These have been a legal requirement since 2005 and can help to reduce your energy bill by up to 20% compared to using a traditional non-condensing boiler.

Condensing boilers work by condensing the water vapour created during the heating process back into hot water. This greatly improves the efficiency of the boiler with the latest A+++ rated models running at 95% efficiency, compared to around 68% efficiency for a non-condensing boiler.

But the best thing about condensing boilers is that they are relatively easy to install and can be fitted into any home with only a few simple modifications. This means homeowners can take advantage of new technology without having to replace their entire central heating system.

How much can you save with a new boiler?

However, before you run off and start planning a new boiler installation, there are a few things to consider. Manufacturers often tout savings of around £210 a year on your energy bills, but it is important to realise that this amount is for replacing an older non-condensing type system in a three bedroom house. Replacing a condensing boiler fitted in the late 1990s will only save you around half that amount.

Those savings also don’t take into account the cost of installation. Consumer research group Which? estimates that the cost of a new boiler installation runs to about £2595 for an average 3-bedroomed home. Initially, this offsets the amount of savings you will make, although you will save money in maintenance and callouts.

But with boiler efficiency improving each year and new smart controls providing even more efficiency gains, there comes a point when it is more cost-effective to replace an old boiler with a new one.

So, when is the ideal time to replace your boiler?

If the cost savings for replacing an older condensing boiler with a new one run at around £120 then it will take close to 20 years to pay for the boiler and installation costs alone. This time is halved if you are replacing an older non-condensing boiler. But purchase and installation costs aren’t the only things to consider.

As the boiler gets older maintenance costs can increase significantly. Typically it costs between £75-100 for an annual service if the boiler is under 10 years old and still under guarantee. An older boiler which is no longer under guarantee can cost twice as much to maintain and you will have to pay for any replacement parts, which can increase the bill to around £300.

When you take annual maintenance costs and installation into account, the most beneficial time to replace a boiler is after 15 years. With most manufacturers providing extended 10-year guarantees, this timeframe means that you are only exposed to an unexpected bill for around five years. In reality, if your boiler has been regularly serviced it should easily last for 15 years without a major failure.

How to keep your new boiler working efficiently

To ensure your new boiler keeps working efficiently you need to ensure that it is serviced annually by a registered GasSafe engineer. Think of this like an MOT for your central heating system and don’t attempt to skip it in an attempt to save money. The longer your boiler goes without a service the less efficient it becomes. You also risk voiding the guarantee, which could leave you exposed to expensive repairs.

Annual boiler maintenance costs between £75-£100 depending on the size of your boiler and where you live. Care packages can also be purchased which cost from £5 per month. When purchasing one of these packages it’s important to read the small print to ensure you know exactly what is covered. Some plans don’t include call-out charges or have a hefty excess for components.

Finally, when choosing a supplier for a new boiler it is important that you choose a reputable GasSafe registered engineer. A poorly fitted boiler will not only be inefficient, it can be potentially dangerous.