Heat Pump vs Gas Furnace: Running Cost

Enter your electricity price, heat-pump COP, gas price and furnace AFUE. The tool converts each system to a delivered $/MMBTU of heat and tells you which is cheaper on your rates — no stored tariff, just the numbers from your bill.

Estimate: results come from the values you enter and standard reference constants. Get real written quotes and check your utility bill before you decide.
Gas & CO safety: Gas appliances must be installed and serviced by a licensed professional. Improper work risks fire and carbon-monoxide poisoning — install CO alarms. This tool is for planning estimates only.

Calculator

$/kWh
From your latest electric bill
Seasonal average (COP 2–4 typical)
$/therm
From your latest gas bill
0–1, e.g. 0.95 = 95% efficient
Gas furnace$15.79 /MMBTU
Heat pump (electric)$14.65 /MMBTU
Cheaper sourceThe heat pump

On your rates, gas heat costs $15.79/MMBTU and the heat pump $14.65/MMBTU — the heat pump is cheaper to run.

The only fair way to compare a heat pump and a gas furnace is to put both on the same footing: the cost to deliver one million BTU (MMBTU) of useful heat into your home. A furnace burns fuel and loses a slice up the flue (its AFUE); a heat pump moves heat with electricity and delivers several units of heat per unit of energy it draws (its COP). Because the two run on different fuels priced in different units, the headline "$/therm vs $/kWh" tells you nothing on its own. This tool normalizes both to delivered $/MMBTU using the rates you type in, so the comparison reflects your utility, your climate and your equipment — not a national average that is stale the day it is published.

Formula

Each system is reduced to a delivered cost per MMBTU:

  • Heat pump: $/MMBTU = electricity price ÷ (3,412 × COP) × 1,000,000
  • Gas furnace: $/MMBTU = gas price ÷ (100,000 × AFUE) × 1,000,000

3,412 BTU is the energy in 1 kWh and 100,000 BTU is the energy in 1 therm — both are fixed physical constants. COP and AFUE are the efficiencies you enter; the electricity and gas prices are yours. The system with the lower delivered $/MMBTU is cheaper to run.

Worked example

Take the defaults: electricity at $0.15/kWh, a heat pump at COP 3, natural gas at $1.50/therm and a 95% AFUE furnace.

  • Heat pump: 0.15 ÷ (3,412 × 3) × 1,000,000 = 0.15 ÷ 10,236 × 1,000,000 = $14.66/MMBTU
  • Gas furnace: 1.50 ÷ (100,000 × 0.95) × 1,000,000 = 1.50 ÷ 95,000 × 1,000,000 = $15.79/MMBTU

The heat pump wins by about $1.13/MMBTU (roughly 7% cheaper) at these rates. Flip the inputs and the answer flips too: cheap gas or a cold-climate COP that sags toward 2 can easily hand the win back to the furnace. That is exactly why the comparison has to run on your numbers, not a rule of thumb.

How to read the comparison

The heat pump's COP is not a single number — it falls as the outdoor temperature drops, because there is less heat outside to move. Use a seasonal average COP here for a whole-winter comparison, then use the balance-point tool to find the outdoor temperature where the furnace becomes cheaper. The furnace AFUE is steadier: a condensing unit stays near 90–98% across the season. Both figures are the ones you enter, so the result is correct forever regardless of what energy prices do next year.

This is a running-cost comparison only. It does not include installation cost, maintenance, the value of central air conditioning a heat pump also provides, or any tax credit — those belong in a separate budget. Confirm real efficiencies from the equipment's AHRI certificate and your actual rates from a 12-month bill history before you commit.

Frequently asked questions

Is a heat pump always cheaper to run than a gas furnace?
No. It depends on your electricity price, your gas price and the heat pump's seasonal COP. Where electricity is expensive and gas is cheap, or in a very cold climate where COP drops toward 2, a modern gas furnace can be cheaper to run. This tool settles it with your actual rates instead of a blanket claim.
What COP should I enter for a heat pump?
Use the seasonal average for your climate. Cold-climate heat pumps often average COP 2.5–3.5 over a heating season, mild climates 3–4+. The nameplate HSPF2 on the AHRI certificate is a good starting point — divide HSPF2 by about 3.4 to approximate a seasonal COP, or use our COP ↔ HSPF2 converter.
Why compare in $/MMBTU instead of $/therm vs $/kWh?
Because a therm and a kWh carry different amounts of energy and each system wastes a different share. Converting both to the cost of one delivered million BTU removes the unit mismatch and the efficiency difference, so you are comparing the same thing: usable heat in your home.
Does this include the cost of the equipment or install?
No. This is operating cost only — the ongoing fuel and electricity bill. Purchase, installation, ductwork and any rebate or tax credit are separate. Use the replacement and financing calculators for the up-front side of the decision.
Where do I find my real electricity and gas rates?
Take the total bill (including delivery, taxes and fixed charges) and divide by the kWh or therms used — that all-in rate is more honest than the headline "supply" price. Do it for a few months to get a seasonal average.

Related calculators

$/MMBTU by FuelRank electric resistance, a heat pump, natural gas, propane and heating oil by delivered cost per MMBTU using your own prices. See the cheapest way to heat.Economic Balance PointFind the break-even COP where a heat pump and a gas furnace cost the same to run on your rates. Above it the heat pump wins; below it the furnace does.Furnace Running CostEstimate furnace running cost from heating output, AFUE efficiency and your own fuel price — natural gas per therm, or propane and heating oil per gallon.Heat-Pump Running CostWork out heat-pump running cost from capacity, COP and your electricity rate. See the kW draw, kWh used and dollar cost for any number of run hours.Electric vs Gas HeatCompare electric heat-pump heating against a gas furnace in delivered dollars per MMBTU, using your utility rates, the AFUE and the heat-pump COP.