Heat pumps vs. furnaces: What you need to know

Your heating system is a central part of your home's safety and security, so it's important to invest in a quality system you're confident in. Heat pumps continue to rise in popularity due to their efficient, cost-effective, and comfortable heating and cooling solutions. But how do heat pumps compare to furnaces? Can they really keep a home warm during the coldest months? In this article, we compare the upfront costs, efficiency, maintenance requirements, and lifetimes of heat pumps and furnaces to help you better understand your options when browsing for your next heating system (that you'll likely spend a couple of decades with!).

When considering the cost of heat pumps compared to furnaces, it's important to consider both the upfront costs and the maintenance costs associated with each technology.

Upfront costs

The upfront costs of both heat pumps and furnaces depend on a number of factors specific to your individual home. Things like ductwork, the layout and insulation of your home, the local climate, the make and model of the heating equipment, and available rebates and incentive programs all influence the total cost of installing a new heating system. For example, a ducted heat pump system can be more expensive than ductless, single-zone mini-splits, and it will be cheaper for homes with direct access to natural gas to install a gas furnace than those that don't. Also, a heat pump model that qualifies for federal or local rebates may be more affordable than a furnace that doesn't.

With so many contributing factors, an apples-to-apples cost comparison is difficult. Ductless mini splits tend to be more affordable than furnaces, while ducted air source heat pump systems can be more expensive to install (although they may end up costing less than a furnace and air conditioner combined). The bottom line is that your cost can vary widely depending on your home's size and existing system, including ductwork, gas lines, and electrical lines.

Sample upfront costs: Heat pumps vs. furnace

Operating costs

Heat pumps run on electricity, while furnaces are powered by electricity, oil, or gas. While electric heating systems can be powered by emission-free solar energy, oil, and gas furnaces burn fossil fuels. Either way, all sources of energy are subject to turbulent markets with rates that vary from state to state. Gas furnaces may benefit from lower rates one season, but the next year natural gas prices could skyrocket. Although energy rates are a consideration when choosing your next heating system, the efficiency of the system is probably a better indicator of operational costs.

September 2022 average U.S. energy rates by region

Source: U.S. Bureau of Labor Statistics

On average, electric furnaces use 10,000 to 50,000 watts (10 to 50 kilowatts) of electricity, while air source heat pumps use between 1,000 and 7,500 watts of electricity in cold weather.

Heat pumps provide annual savings of $500 to $900, on average. The tables below will give you an idea of what it will cost to heat a home in a couple of different states this coming year using different types of heating systems, but it's important to remember that this varies significantly depending on your local climate, utility costs, and the efficiency of your unit.

Heat pumps vs. furnaces: Annual heating operating costs

Sources: Efficiency Maine and Avista

Heat pumps are one of the most efficient heating systems available and use significantly less energy than furnaces because, unlike furnaces, they don't actually generate heat. Instead, they transfer heat from one place to another. This is especially advantageous when you compare them to electric furnaces; according to the Department of Energy, air source heat pumps can reduce electricity use for heating by 50 percent. Not only does this process require less energy, but it also avoids the use of fossil fuels – so, all things being equal, heat pumps are more energy efficient than furnaces.

However, the performance of a heat pump system is also dependent on a number of factors, like proper installation and local climate. The colder it gets, the harder heat pumps have to work. However, due to impressive advancements in heat pump technology, cold climate-certified heat pumps are able to maintain efficiency and keep your home warm in temperatures well below zero. Even still, there are some instances when furnaces become the more efficient option in extremely cold climates.

Maintenance for a furnace is similar to that of a heat pump: HVAC experts recommend both systems be serviced at least once a year by a professional in addition to regular at-home maintenance. Furnaces and heat pumps alike should have clean air filters, clean vents, and clutter-free spaces around the units in order to perform optimally. Uniquely, gas furnaces require a clear exhaust flue to the outside to prevent harmful fumes from entering your home and causing serious health risks. Additionally, heat pumps serve as a heating and cooling system, whereas furnaces can only generate heat. Due to the increased use of heat pumps, maintenance costs may be higher and more frequent than for a furnace alone.

Currently, the lifetime of a furnace tends to be a bit longer than that of a heat pump. It's generally accepted that furnaces last about 20 years, whereas heat pumps are useful for around 15 years. However, some heat pump experts claim that the best quality heat pumps can continue heating and cooling your home for between 20 to 25 years when well-maintained. Overall, a furnace will probably outlast a heat pump by two to five years.

Unlike furnaces that burn natural gas or oil, you can power heat pumps with solar panels to save even more money and shrink your carbon footprint. The EnergySage Marketplace provides qualified quote comparisons from local installers to help you find a solar system that fits both your energy and budget needs. Sign up to receive free quotes from qualified, pre-vetted installers so you can start the process of going solar today!