Heat Pump vs Furnace

Heat Pump vs Furnace

If you’re in the market for home heating, you have two main choices: a heat pump or a furnace. At one time, this was a fairly simple decision based on climate. If you lived in a region with mild weather, a heat pump was a better choice, while those living in colder areas needed a furnace. Today, though, many heat pumps are designed to work in temperatures well below freezing. Here’s what you should know about heat pumps and furnaces, and how to choose between them.

Heat Pump and AC on side of house

GSPhotography / Shuttershock

Heat pumps

Heat pumps work by moving heat around, much like an air conditioner with a reverse cycle. During the hot summer, the heat pump removes warm air from your home, cooling it down. In the winter, the heat pump sends warm air into your home to heat it.

All heat pumps have two energy efficiency ratings: the SEER (Seasonal Energy Efficiency Ratio) and the HSPF (Heating Season Performance Factor). These numbers are found by dividing the cooling or heating output of the unit, respectively, by how much electrical energy it consumes. Higher numbers indicate better energy efficiency.

Types of heat pumps

Heat pumps are available in a few different types. A conventional, or split-system, heat pump has both indoor and outdoor components. It uses a series of ducts to force air through your home.

A package unit is often a better solution for those without much interior space. All the components are housed in a single outdoor unit, which may be mounted on a concrete pad outside your home or even on the roof.

If your home lacks ductwork, or you want to heat and cool a new addition, a ductless mini split may be the least expensive and most practical choice.

Heat pump benefits

Heat pumps have several advantages. One of the biggest is that they provide both heating and cooling, eliminating the need to invest in a separate air conditioner. They are also more energy efficient than furnaces since they don’t actually create heat, and they are more environmentally friendly since they consume no fossil fuels and give off no emissions. In addition, if you live in a temperate climate, you may experience a significant reduction in your monthly energy bills when switching to a heat pump.

Heat pumps are generally easy to maintain with regular cleaning and filter changes. Once a year, have your heat pump professionally serviced.

Heat pump costs

Heat pump pricing varies widely, from hundreds of dollars to tens of thousands, depending on the size, type, and features. On average, you can expect to pay a few thousand for a whole-home heat pump system. Installation charges are extra and depend on such factors as your geographic region, the size of your home, and how difficult the installation process is. Contact a local HVAC professional for the most accurate pricing based on an in-home assessment. You will also need to factor in the cost of electricity to run the heat pump, though these prices are generally low compared to the cost of fuel for a furnace.


A furnace generates heat by burning a fuel source (gas or oil) and then forcing it throughout your home via a series of ducts. A furnace typically shares interior cabinet space, ductwork and a thermostat with a conventional air conditioner, but you can have a furnace installed even if you don’t have air conditioning.

All furnaces have an energy efficiency rating known as the AFUE (annual fuel utilization efficiency). This is a percentage that shows how much of the energy consumed by the furnace becomes heat rather than escaping as energy loss. The higher the AFUE percentage, the more efficient the furnace is.

Types of furnaces

Furnaces come in two basic types: gas and oil. There are many similarities, but each type has its own unique features, as well as pros and cons for different homes.

Natural gas furnaces are environmentally friendlier and more energy efficient than oil furnaces. Natural gas also costs less than oil. However, you will pay more up front for a natural gas furnace. In addition, there must be a supply of natural gas in your area for this type of furnace to be installed.

Oil furnaces are less expensive up front than natural gas, but your fuel costs will depend on the highly volatile oil market. Oil is also less eco-friendly than gas, and you must regularly clean your furnace to avoid a buildup of soot and debris. In addition, you must schedule oil deliveries throughout the heating season. However, oil furnaces can be installed in areas where there is no natural gas. If you live in a very cold climate, it is important to note that oil furnaces provide more heat per BTU (British thermal unit) than gas.

Furnace benefits

One of the biggest benefits of a furnace is its reliability. Though modern heat pumps work pretty well in temperatures that dip below freezing, they still have to source heat from somewhere. If your region experiences long, cold winters, it’s generally best to choose a furnace, which generates its own heat.

Another benefit is that furnaces tend to last longer than heat pumps. Since they are used only during the heating season, they generally require less maintenance and sustain less wear and tear. While the average useful life of a heat pump is just 10 to 15 years, both gas and oil furnaces can easily last 20 to 30 years with proper care.

Furnace costs

Gas furnaces typically cost $1,000 to $3,000 or more, depending on size and features. Residential size oil furnaces are generally priced around $2,000 or less, depending on features and size. Installation charges are additional. These costs vary based on such factors as your geographic location, the difficulty of the installation, and the size of your home. A local HVAC professional can provide a comprehensive estimate based on an assessment of your home. When calculating the total costs associated with your furnace, don’t forget to include the price of fuel as well as maintenance, especially if you select an oil furnace.

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