Is a heat pump cheaper to run than a gas furnace?

How the comparison works

The calculator starts from the heat your house actually needed last winter. A furnace that burned 600 therms at 80% efficiency put 48 million Btu of heat into the house: 600 therms are 60 million Btu of gas, and 80% of that reached the rooms. Any new system has to deliver the same heat, so the comparison is what that heat costs from each one.

A new gas furnace needs the heat divided by its efficiency, in therms, times your gas price. A heat pump needs the heat divided by its seasonal efficiency, in kWh, times your electricity price. HSPF2 is the heat pump's rating for a heating season, in Btu of heat per watt-hour of electricity; dividing it by 3.412 gives the seasonal coefficient of performance. At 8.5 HSPF2 that is about 2.5, meaning 2.5 units of heat for each unit of electricity. At the federal minimum of 7.5 HSPF2 it is 2.2.

The break-even electricity price in every state

For each state, the table shows the electricity price at which a 8.5 HSPF2 heat pump and a 95% gas furnace cost the same to run, given that state's gas price last winter. If the state's winter electricity price is below that line, the heat pump is cheaper to run.

What the table cannot see

A state average hides your own rates, and the margin in many states is small enough that your utility's price decides it. Run the calculator with the numbers from your bills.

Cold weather matters too. HSPF2 is measured for a moderate reference climate. In places with long stretches well below freezing, a heat pump's seasonal efficiency comes out lower than its rating, and many systems switch to electric resistance backup in the coldest hours, which costs far more per unit of heat (see the space heater page for why). Models sold as cold-climate heat pumps publish their efficiency at low temperatures; it is worth asking an installer for those figures. In a mild climate, the opposite happens and a heat pump often beats its rating.

Running cost is also not total cost. Installation prices vary widely, a heat pump replaces the air conditioner as well as the furnace, and dropping gas entirely removes the fixed monthly charge for the gas connection, which can be a meaningful part of a gas bill. Some homes keep the furnace as backup for the coldest days, which changes the math again.

The heating fuel cost comparison puts propane, heating oil and electric resistance in the same table, and natural gas prices by state explains why the winter gas price is the one used here.