Updated August 15, 2026 · WattCostLab Calculator
Heat Pump vs Gas Furnace Cost Calculator
Compare simplified annual heating operating costs using the same delivered heating demand for both systems.
How this comparison is calculated
The calculator forces both systems to deliver the same annual amount of heat, then estimates how much purchased electricity or natural gas is required to provide it. Annual heating demand is entered in MMBtu. WattCostLab converts each MMBtu to 293.07107 kWh of delivered heat for the heat-pump side and to 10 therms of delivered heat for the gas side.
Heat-pump electricity use is delivered heat in kWh ÷ average COP. Gas input is delivered therms ÷ furnace efficiency. Each fuel quantity is then multiplied by the price you enter. That makes the comparison sensitive to the three variables that usually matter most for operating cost: seasonal heat-pump performance, local electricity price and local gas price.
Worked example using the page defaults
With 50 MMBtu/year of delivered heating demand, COP 3.0, electricity at $0.173/kWh, a 95% efficient gas furnace and gas at $1.50/therm:
- Delivered heat for the heat-pump calculation: 50 × 293.07107 = about 14,654 kWh thermal.
- Heat-pump electricity: 14,654 ÷ 3.0 = about 4,885 kWh/year.
- Heat-pump energy cost: 4,884.5 × $0.173 = about $845/year.
- Delivered gas heat: 50 × 10 = 500 therms; at 95% efficiency the furnace requires about 526 therms/year.
- Furnace energy cost: 526.3 × $1.50 = about $789/year.
Under those specific assumptions the gas furnace is lower by about $56/year in variable energy cost. Holding the other default inputs constant, the two options are approximately equal at an electricity price near $0.162/kWh. Below that level the modeled heat pump becomes cheaper to operate; above it the modeled gas furnace becomes cheaper. This break-even point changes immediately when COP, furnace efficiency or gas price changes.
Why COP deserves special attention
COP is not a fixed nameplate efficiency for an entire winter. Heat-pump performance varies with outdoor temperature, equipment capacity, defrost cycles, airflow, part-load operation and controls. Resistance backup heat can also raise electricity use during cold periods. For a planning comparison, use a seasonal COP that reflects your climate and the specific equipment rather than a best-case laboratory point.
Costs intentionally excluded
This tool compares variable heating energy only. It does not include equipment purchase, installation, financing, maintenance, incentives, fixed utility customer charges or the value of cooling provided by a heat pump in summer. Fixed gas charges deserve particular attention if switching to a heat pump would allow the gas account to be eliminated entirely.
The U.S. Department of Energy notes that heat pumps transfer heat rather than generate it directly and that climate conditions affect air-source heat-pump performance. See the DOE heat-pump guidance. Use this calculator to test operating-cost sensitivity, then compare installed-cost proposals separately.
Important limitation: COP changes with weather
A single annual COP is a simplification. Real heat-pump performance changes with outdoor temperature, defrost operation, part-load behavior, controls and any resistance backup heat.
Gas price input
Use the energy portion of your gas bill when possible. Fixed monthly customer charges can complicate comparisons, especially if gas would otherwise be eliminated from the home.
Investment cost is separate
This calculator compares operating energy only. It does not include equipment purchase, installation, maintenance, financing or incentives.
Related pages
See Air Source Heat Pump Installation Cost, Gas Furnace Installation Cost and Heat Pump Running Cost Calculator.
Heat pump vs gas furnace: how the cost comparison works
A fair comparison starts with the same amount of useful heat delivered to the home. A heat pump's cost depends strongly on its seasonal COP, while a furnace comparison must account for fuel price and combustion efficiency.
Illustrative example
Assume a home needs 12,000 kWh-equivalent of useful space heat over a season. With a seasonal COP of 3.0, the heat pump would require about 4,000 kWh of electricity. At $0.18/kWh, that is about $720/year. The calculator above lets you replace these assumptions with your own local rates and equipment performance.
When can the result flip?
- Higher electricity prices can favor gas.
- Higher gas prices can favor the heat pump.
- A lower heat-pump COP during cold weather increases electricity use.
- A high-efficiency furnace needs less fuel for the same delivered heat.
- Solar generation or time-of-use tariffs can change the electricity side of the comparison.
Operating cost is only one decision factor. Installation cost, cooling capability, maintenance, climate and expected equipment life should be considered separately.