Heat Pump vs Gas Furnace Cost Calculator

This heat pump vs gas furnace cost calculator shows what one year of heating costs with four systems: an electric heat pump, a natural gas furnace, a propane furnace and a heating oil furnace. Each one has to deliver the same amount of heat to your home, so the only things that change are the price of the fuel and how efficiently the equipment turns it into heat. Enter your electricity rate, your gas price per therm or per Mcf, your propane and oil prices, and the efficiency ratings of each system. The defaults are US averages from the U.S. Energy Information Administration (EIA).

How the calculator works

Start with the heat your home needs in a year, in millions of BTU (MMBtu). Then:

• Heat pump: kWh = MMBtu × 1,000,000 ÷ (HSPF2 × 1,000), then × your price per kWh
• Natural gas: therms = MMBtu × 10 ÷ AFUE, then × your price per therm
• Propane: gallons = MMBtu × 1,000,000 ÷ 91,452 ÷ AFUE, then × your price per gallon
• Heating oil: gallons = MMBtu × 1,000,000 ÷ 138,500 ÷ AFUE, then × your price per gallon

HSPF2 is the seasonal heating rating on every new US heat pump: BTU of heat per watt-hour of electricity. AFUE is a furnace’s annual fuel utilization efficiency, the share of the fuel’s heat that reaches your rooms. Fuel heat contents are from the EIA energy conversion calculators. The calculator also shows the break-even electricity price: the rate per kWh at which the heat pump and the gas furnace cost the same.

Worked example at US average prices

The default result heats a home that needs 50 MMBtu a year:

Gas is cheapest at these prices. The heat pump costs $460 more than gas, but $421 less than propane and $1,416 less than oil. The break-even rate against gas is 752.63 ÷ 6,667 = 11.3¢/kWh: below that, the heat pump wins.

Where the default prices come from

All prices are EIA US residential averages (data version 25 October 2026):

• Natural gas: $14.85 per Mcf, the average of November 2025 to March 2026 from the EIA residential natural gas price series. We use winter months because summer prices per Mcf run far higher when fixed charges are spread over little gas. At about 10.37 therms per Mcf (the EIA’s 2025 average of 1,037 Btu per cubic foot), that is $1.43 per therm.
• Propane: $2.69 a gallon and heating oil: $6.19 a gallon, week of 19 October 2026, from the EIA weekly propane and heating oil surveys, which run October to March. These weekly survey prices exclude taxes, so your delivered bill will be a little higher.
• Electricity: 18.2¢/kWh, the US residential average from EIA Electric Power Monthly (August 2026).

Prices vary widely by state and supplier, so use the figures on your own bills for a real answer. EIA data is public domain; source: U.S. Energy Information Administration.

Is a heat pump cheaper than gas?

At national average prices, not quite, but the gap is smaller than many people expect, and it flips in states with cheap electricity or expensive gas. A rule of thumb from the formulas: with a 95% furnace and an HSPF2 of 7.5, the heat pump wins when your price per kWh is less than about 7.9 times your price per therm. At $1.43 a therm that is 11.3¢/kWh; at $2.00 a therm it is 15.8¢.

The heat pump also cools your home in summer, which a furnace cannot, and the U.S. Department of Energy notes that a heat pump can deliver up to three times more heat energy than the electricity it consumes. Very cold weather lowers that ratio, so in the northern US check a cold-climate model’s ratings and lower the HSPF2 you enter.

Heat pump vs propane and oil

Homes without a gas line usually burn propane or heating oil, and that is where a heat pump saves the most. Propane delivers only 91,452 BTU a gallon, so even at $2.69 a gallon each MMBtu of delivered heat costs about $33, against $24 for the heat pump in the example. Heating oil at $6.19 a gallon costs over $52 per MMBtu delivered.

How to find your home’s heat load

The calculator needs the heat your home actually uses, not the size of your furnace. Take last winter’s fuel bills:

1. Gas: therms per year × AFUE × 0.1 = MMBtu (600 therms × 0.9 × 0.1 = 54 MMBtu)
2. Propane: gallons × 0.0915 × AFUE
3. Oil: gallons × 0.1385 × AFUE

Leave out gas used by a water heater, stove or dryer. To convert other heat figures, use the BTU to kWh converter.

For the emissions side of the same choice, try the carbon footprint calculator, and see our tips on how to lower your electric bill if you switch to electric heat.

History of heating efficiency ratings

AFUE for furnaces and HSPF for heat pumps come from US Department of Energy test procedures written under the Energy Policy and Conservation Act of 1975. From 1 January 2023, federal rules require heat pump ratings to be based on a revised test, 10 CFR 430 Appendix M1, labelled HSPF2 and SEER2. It uses higher duct pressures that better reflect real installations, so an HSPF2 figure is lower than the old HSPF for the same unit. Use HSPF2 numbers in this calculator.

References

• U.S. EIA. Price of Natural Gas Delivered to Residential Consumers. eia.gov
• U.S. EIA. Weekly Heating Oil and Propane Prices. eia.gov
• U.S. EIA. Energy conversion calculators. eia.gov
• U.S. eCFR. 10 CFR Part 430, Subpart B, Appendix M1. ecfr.gov
• U.S. DOE. Heat Pump Systems. energy.gov