Heat Pump vs. Furnace: How Much Can You Save?
Looking for ways to lower your home heating costs? If you currently heat with a propane or natural gas furnace, switching to a modern heat pump system could cut your utility bills by hundreds or even thousands of dollars per year.
Use our interactive Heat Pump Savings Calculator below to see how much you could save based on your state, home size, fuel type, and heat pump efficiency.
Why Heat Pumps Can Be Cheaper to Run Than Furnaces
They’re more efficient
Even the best furnaces only convert about 90–96% of the fuel you buy into heat for your home. A heat pump works differently — by moving heat instead of generating it — which allows it to reach 200–400% efficiency. In plain English, that means for every $1 you spend on electricity, you can get $2–$4 worth of heat.
You spend less on fuel
Propane and natural gas prices can be unpredictable, especially in the winter when demand is high. Electricity costs are usually more stable, and in many states it’s simply cheaper to heat with a heat pump than with fuel.
One system does it all
With a furnace, you still need a separate air conditioner for summer. A heat pump handles both heating and cooling, so you’re only maintaining one system instead of two.
They’re cleaner and safer
Heat pumps don’t burn anything, so there’s no risk of carbon monoxide leaks and fewer greenhouse gas emissions. If your utility offers renewable electricity — or if you have solar panels — your home heating can be almost carbon-free.
Incentives and rebates can sweeten the deal
On top of lower monthly bills, many states and utilities offer rebates and tax credits when you install a heat pump. That helps with the upfront cost and shortens the payback period.
Comfort you’ll notice
Heat pumps run longer, gentler cycles instead of blasting hot air for a few minutes and then shutting off. The result is a more even, comfortable temperature throughout your home.
Is a Heat Pump Right for You?
If you heat with propane, fuel oil, or electric resistance, a heat pump almost always comes out ahead. For natural gas, it depends more on your local rates, but the savings are still there with today’s high-efficiency models.
The best way to know for sure? Use the calculator above to compare your costs. It uses real state-level energy prices and lets you choose different efficiency levels (standard, high-efficiency, or inverter).
The Bottom Line
Heat pumps have come a long way. Modern systems work even in cold climates, and they give you lower bills, year-round comfort, and peace of mind knowing your home is safer and cleaner.