Heat pump or gas furnace — which heats your home cheaper?
One number decides it: whether your electricity is cheap enough relative to your gas. Put in both prices and see the annual difference, the breakeven point, and how fast a heat pump's price premium pays back — honestly, including where gas wins.
An independent estimate for guidance only. Real performance depends on your climate, ductwork, insulation and the unit itself — get a Manual J load calculation and itemised quotes before deciding.
Heat pump vs gas by state
At the national-average gas price ($1.50/therm), which way the comparison falls depends on each state's electricity rate. Choose yours in the calculator above — then edit the gas price to match your bill, because local gas prices vary as much as power prices do.
● heat pump wins ● close call ● gas wins
How the comparison works
Both machines make the same product — heat in your rooms — so the honest comparison is what a unit of that heat costs from each:
- A gas furnace turns therms into heat at its AFUE efficiency: a new condensing furnace delivers ~95% of what it burns, an older unit closer to 80%.
- A heat pump moves heat rather than making it, so it delivers 2–3× the energy it consumes. That multiplier (seasonal COP) is the whole reason this comparison is even close despite electricity costing more per unit of energy than gas.
- The tipping point is your electricity price. At $1.50/therm gas, 95% AFUE and COP 2.6, the two tie at about 14¢/kWh. Cheap-power states sit well under that; New England mostly sits over it — though its gas is dearer too, which is why you should enter both of your real prices.
Full assumptions on the methodology page. Switching heat to electricity also raises how much of your bill rooftop solar can offset — though be honest with the seasons: panels produce least in exactly the months you heat most.
Common questions
Is a heat pump cheaper to run than a gas furnace?
It depends on two prices: your electricity rate and your gas rate. A typical ducted heat pump delivers about 2.6 units of heat per unit of electricity, while a new gas furnace delivers about 0.95 per unit of gas burned. At the US-average gas price of roughly $1.50/therm, the two tie at an electricity price of about 14¢/kWh — cheaper power than that and the heat pump wins; dearer and gas does. The calculator does this sum with your real numbers.
Is there still a federal tax credit for heat pumps?
No. The Section 25C credit — up to $2,000 for a qualifying heat pump — ended for equipment placed in service after 31 December 2025, under the same law that ended the residential solar credit. State and utility rebates still exist and can be worth thousands; check DSIRE for your state before you buy.
Do heat pumps work in cold climates?
Modern cold-climate units heat effectively well below 0°F, but efficiency falls as temperature drops — a unit that averages COP 3 in a mild winter might average closer to 2 in a hard one, and resistance backup heat on the coldest days costs more again. If you’re in a cold state, use a lower COP in the calculator (2.0–2.4) and ask installers for the unit’s cold-climate performance data, not just its HSPF2 rating.
What about cooling costs?
Roughly a wash. A heat pump is an air conditioner that also runs in reverse, and its cooling efficiency (SEER2) is similar to a comparable AC. That’s why this calculator compares heating only — it’s where the real money difference lives.
How many therms do I burn on heating?
Pull your gas bills and subtract your typical summer month (water heating and cooking) from each winter month — the difference is space heating. The US average for a gas-heated home is around 566 therms a year, but a small mild-climate home might burn 250 and a large cold-climate one well over 1,000.