Heat Pump vs. Gas Furnace: Pros & Cons
🌿 Heat Pump — Pros
- Heats AND cools — one system
- 2–4x more efficient than gas
- No combustion risk (safer)
- May qualify for state/utility rebates†
- Lower carbon footprint
🌿 Heat Pump — Cons
- Higher upfront cost
- Less effective below 15–25°F
- Needs backup heat in cold climates
- Higher electricity bills
🔥 Gas Furnace — Pros
- Lower upfront cost
- Powerful heat in extreme cold
- Gas is often cheaper than electricity
- Faster warmup time
🔥 Gas Furnace — Cons
- Needs separate AC system
- Combustion safety risk
- Higher carbon emissions
- Dual maintenance (furnace + AC)
† The federal Energy Efficient Home Improvement Credit (Section 25C) for heat pumps expired for equipment placed in service after December 31, 2025, under the One Big Beautiful Bill Act — it no longer applies to 2026 installs. Income-qualified households may still access the federal HEAR rebate program (up to $8,000) where launched, and separate state or utility rebates for heat pumps often remain available.
How This Comparison Is Calculated
The calculator converts your climate zone into an estimated annual heating load (in therm-equivalents), then prices that load two ways:
- Heat pump path — the load is divided by the unit's COP (Coefficient of Performance) and priced at your electricity rate. A COP of 3.0 means the heat pump delivers about 3 units of heat for every 1 unit of electricity it consumes — heat pumps move existing heat rather than generating it from fuel, which is why their COP is well above 1.0.
- Furnace path — the load is divided by the furnace's AFUE (Annual Fuel Utilization Efficiency) and priced at your natural gas rate. AFUE is the percentage of fuel input actually converted to usable heat; a 90% AFUE furnace converts 90 cents of every gas dollar into heat, with the rest lost as exhaust.
- Cooling costs are estimated separately and added to both sides, since a heat pump also cools while a furnace requires a separate air conditioner.
- Install costs and annual maintenance are added to produce 5-year and 15-year totals for a like-for-like comparison.
Because a heat pump's running cost depends on your local electricity rate and a furnace's depends on your local gas rate, the "winner" genuinely differs by region and utility market — there is no single nationwide answer, which is why the calculator asks for your specific rates rather than assuming national averages.
Frequently Asked Questions
What is COP for a heat pump?
COP (Coefficient of Performance) measures how much heat a heat pump delivers per unit of electricity it consumes. A COP of 3.0 means the heat pump delivers about 3 units of heat energy for every 1 unit of electrical energy used — why heat pumps are described as more efficient than resistance electric heat or combustion heating.
What is AFUE for a gas furnace?
AFUE (Annual Fuel Utilization Efficiency) measures what percentage of a furnace's fuel input is converted into usable heat over a year, with the rest lost as exhaust. A 90% AFUE furnace converts 90 cents of every dollar of gas into heat; the remaining 10% is lost up the flue.
Do heat pumps really struggle in cold climates?
Standard heat pumps lose efficiency as outdoor temperatures drop, typically becoming less effective below roughly 15-25°F, which is why cold-climate installs often pair a heat pump with backup electric resistance or a furnace for the coldest days. Cold-climate-rated heat pump models perform better at low temperatures than standard models, but backup heat is still common practice in very cold regions.
Why does electricity vs. gas price matter so much?
A heat pump's running cost depends on the local electricity rate, while a furnace's running cost depends on the local natural gas rate. Because these two fuels are priced completely differently from region to region, the same home can favor a heat pump in one utility market and a furnace in another — there is no single nationwide answer.
Related Calculators
Methodology and federal incentive information last reviewed August 2026. Actual results depend on your specific utility rates, climate, and equipment — treat this as a planning estimate, not a quote.