(The information in this article has been updated by a more optimistic article that looks at the before and after experience of a ASHP installation in Oxford, Please go to http://www.carboncommentary.com/2010/08/03/1632) Small heat pumps are increasingly used to provide space and water heating in UK homes. This trend is strongly encouraged by policy-makers and the government’s proposed Renewable Heat Incentive will add further financial support. The enthusiasm for this expensive technology should be moderated: for a home on the mains gas network, the savings in money will be small. Carbon benefits are probable but far from guaranteed. Moreover, air source heat pumps are unlikely to be able to heat many older homes effectively. Government, manufacturers, and installers need to be very much more cautious in encouraging the use of heat pumps and should use far more conservative payback assumptions. Heat pumps will eventually be a good investment for homeowners but probably not yet.