Choosing Between A Heat Pump And A Furnace for Your Home

Should you pick a heat pump or a furnace for your house? Your choice depends on things like your weather, energy costs, and what your home needs. Most homes in the U.S. use a furnace. But more people are getting heat pumps, especially where winters are not too cold.

When you look at heating choices, think about price, how well it works, how to set it up, and how to take care of it. Each system works best in different places and for different ways people use energy.

Key Takeaways

• Heat pumps move heat to warm or cool your home. They work best in places that are not too hot or cold. Furnaces make heat by burning fuel. They are better for very cold places.

• Heat pumps cost more to put in at first. But they save money later because they use less energy. They also give both heating and cooling.

• Furnaces heat your home fast. They work well when it is very cold outside. But they can cost more to use. They might also make the air inside dry.

• You should do regular maintenance like changing filters. Cleaning the units also helps. This keeps both systems working well and lasting longer.

• The best system for you depends on your weather, energy prices, space, and comfort. Incentives can help lower your costs.

How Heat Pumps Work

Basics

A heat pump moves heat instead of making it. You use a heat pump to keep your home warm in winter and cool in summer. The system works by transferring heat from one place to another. It uses a special fluid called refrigerant that flows through coils and pipes.

Here is how a typical heat pump works:

1. The compressor squeezes the refrigerant, making it hot and high-pressure.

2. The hot refrigerant moves to the condenser, where it releases heat.

3. The expansion valve lowers the pressure and cools the refrigerant.

4. The refrigerant goes to the evaporator, where it absorbs heat and starts the cycle again.

You find different types of heat pumps. The most common is the air-source heat pump, which takes heat from the outside air. Another type is the ground-source heat pump, which pulls heat from the ground. Both types use the same basic process, but they get heat from different places.

Tip: A heat pump does not burn fuel. It uses electricity to move heat, making it more efficient than many other systems.

Heating and Cooling

A heat pump can both heat and cool your home. In winter, the system pulls heat from outside and brings it inside. Even when it feels cold, there is still heat in the air or ground for the heat pump to use. In summer, the process reverses. The heat pump takes heat from inside your home and moves it outside, just like an air conditioner.

The air-source heat pump is popular because it works well in many climates. It can keep your home comfortable all year. The ground-source heat pump is even more efficient, but it needs more space and costs more to install.

You get steady temperatures and better air quality with a heat pump. The system filters and dehumidifies the air as it runs. You can choose a ducted or ductless system, depending on your home’s setup.

How Furnaces Work

Basics

A furnace heats your home by making warm air and moving it through your rooms. You can find a furnace in many homes across the country. The system burns fuel or uses electricity to create heat. Then, a blower fan pushes this warm air through metal ducts and out of vents in each room. Cooler air from your home returns to the furnace, where it gets heated again. This cycle keeps your house at the temperature you set on your thermostat.

You will see several important parts in a furnace:

A gas furnace uses a pilot light to ignite burners. The burners heat the heat exchanger, and the blower sends the warm air through your home. An electric furnace works a bit differently. It uses electric coils to heat the air, but the blower and ducts work the same way.

Tip: A furnace with a forced-air system can heat your home quickly and evenly.

Types

You can choose from different types of furnaces. The main types are gas furnace, oil furnace, electric furnace, and propane furnace. Each type uses a different fuel and has its own pros and cons.

You will also find different ways a furnace can run. A single-stage furnace always works at full power when on. A two-stage furnace can run at high or low settings, which helps save energy and keeps your home more comfortable. Some furnaces have variable-speed fans that adjust how fast air moves, making your home feel even better.

A gas furnace is the most common choice in many areas. An electric furnace works well if you do not have access to gas or oil. Each furnace type gives you a way to keep your home warm, but the best choice depends on your needs and local energy prices.

Cost Comparison

Installation Costs

When you look at heating systems, the first thing you notice is the difference in installation costs. Heat pumps usually have a higher upfront cost than furnaces. This is because a heat pump can both heat and cool your home, while a furnace only heats. Here is a table that shows the average installation cost for each system in the United States:

You may pay more for a heat pump at first, but you get both heating and cooling in one system. The cost of installation changes based on where you live. Labor rates are higher in some areas, and local rules can add to the price. If you live in a cold climate, you might need a more powerful system, which increases the cost. The size of your home also matters. Bigger homes need larger units, which cost more to install. If your ductwork needs repairs or upgrades, that adds to the total installation cost. Complex homes, like those with more than one floor, can make the job harder and raise the price.

Note: Contractors use your home's size, insulation, and layout to pick the right system. This helps you avoid paying too much for a system that is too big or too small.

Operating Costs

After you pay for installation, you need to think about how much it will cost to run your system each year. The cost to operate a furnace or heat pump depends on energy prices in your area. Natural gas furnaces often have lower operating costs in many states. On average, you could save about $1,132 each year with a gas furnace compared to an all-electric heat pump, especially in places where gas is cheap.

Heat pumps use electricity. Their annual energy costs range from about $533 to $885, depending on how efficient the model is. ENERGY STAR heat pumps can save you more money over time. Here is a table that compares the yearly operating costs for both systems:

The cost to run your system can change from year to year. Electricity rates often go up during summer, which can make heat pumps more expensive to use for cooling. Some power companies offer lower rates in winter to help with heating costs. Natural gas prices can also change, but they are usually more stable than oil or propane. If you live in a place with low electricity rates, a heat pump can save you money. If you use propane or oil, a heat pump may help you avoid price spikes. Heat pumps are much more efficient than electric resistance heating, so you will see lower costs if you switch from that type of system.

Tip: Always check your local energy prices before you choose a system. The cost to run your heating and cooling can be very different from one region to another.

Incentives

You can lower your total cost by using rebates and tax credits. The federal government offers a tax credit for installing a qualifying heat pump. You can get up to 30% of the project cost back, with a cap of $2,000. This credit applies to both homeowners and renters, and you can use it for your main or second home. The system must meet certain efficiency standards, so check with your contractor before you buy.

Many states and utility companies also offer rebates. You can find these by entering your zip code into rebate finder tools. If you combine a heat pump with other upgrades, like new insulation or windows, you can get even more money back. For gas furnaces, you can get a federal tax credit of up to $600, but this is set to expire after 2025. Some states offer extra rebates for high-efficiency furnaces.

• The 25C tax credit gives you up to $2,000 for a heat pump and up to $600 for a gas furnace.

• Low-income families can get up to 100% of the cost covered for a heat pump, with a cap of $8,000.

• Moderate-income families can get 50% of the cost covered.

• These credits and rebates lower your upfront cost and help you save money faster.

• You must keep your receipts and paperwork to claim these incentives.

• The federal tax credits expire at the end of 2025, so act soon to get the best deal.

Callout: Incentives can make a big difference in your total cost. They shorten the payback period and make energy-efficient systems more affordable.

Performance in Different Climates

Cold Weather

You may wonder if a heat pump works in freezing weather. People used to think only a furnace could heat homes in cold places. But now, heat pumps have new technology. They can keep your house warm even when it is very cold outside.

Tests in cold states like Minnesota show heat pumps work all winter. These systems use much less energy than old heaters. Sometimes, they use 35% to 50% less energy. The U.S. Department of Energy says a heat pump gives you over three times more heat for each unit of electricity. This makes it much better than electric resistance heating.

Cold-climate heat pumps work even at -22°F. They keep your home warm without losing much power. These systems meet ENERGY STAR® rules, so they work well at 5°F. You get steady temperatures inside with fewer changes than older furnaces. Some homes in the Northeast and Midwest use heat pumps all winter. They only turn on backup heat on the coldest days.

New features help heat pumps work better in the cold. Here are some of the upgrades:

• Variable-speed compressors and fans change speed to match your needs. This saves energy and keeps you comfortable.

• Enhanced vapor injection lets the system work in lower temperatures and stay efficient.

• Electronic expansion valves control refrigerant flow, so the system runs well.

• Sensors and smart controls help the heat pump adjust to the weather.

These upgrades mean a heat pump can heat your home in very cold weather. You might still want a backup for the coldest days. Most of the time, the heat pump will be enough. Furnaces still give strong, steady heat in freezing weather. They make hotter air, which some people like when it is very cold. But a furnace can dry out the air, so you may need a humidifier to feel good.

Note: If you live where winters are harsh, you can pick a heat pump or a furnace. Both will keep you warm. The main difference is how each one works in extreme cold.

Mild and Warm Areas

If you live where it is mild or warm, a heat pump is often best. This system moves heat instead of making it, so it uses less energy. You get both heating in winter and cooling in summer from one system. This makes a heat pump very efficient and easy to use.

In places where it rarely gets below 30°F, a heat pump works well. You do not need backup heat. The system also removes extra humidity in summer, so you feel cooler and more comfortable. Mini-split heat pumps let you set different temperatures in each room. This helps everyone stay comfortable.

A furnace can still heat your home in a mild climate. But it only gives heat. You need a separate air conditioner for cooling. Furnaces use more energy in these areas because they burn fuel or use electric coils. This can make your bills higher and cause more pollution.

Here is a quick comparison for mild and warm climates:

You will see that a heat pump gives more comfort and saves money in mild climates. It keeps the air at a steady temperature and does not dry out your home as much as a furnace. The air from a heat pump is not as hot as from a furnace. But it feels good because it keeps the humidity at a nice level.

Tip: In places like Western Oregon or Washington, a heat pump is often the best choice for saving energy and staying comfortable.

If you want a system that works all year and helps you save money, a heat pump is a smart choice for mild and warm places. A furnace is best if you only need heat and do not mind using a separate system for cooling.

Maintenance and Lifespan

Routine Care

You can keep your heating system running smoothly with regular care. Both heat pumps and furnaces need attention to work their best. If you follow a few simple steps, you help your system last longer and avoid costly repairs.

Here are some important maintenance tasks you should do:

1. Change or clean air filters every 1 to 3 months. Clean filters keep the air fresh and help your system run efficiently.

2. Keep the area around your outdoor unit clear. Remove grass, leaves, and debris so air can flow freely.

3. Clean the outdoor coils of your heat pump with a gentle spray from a garden hose. Do this when the unit is off. In winter, remove ice or snow buildup carefully.

4. Adjust your thermostat settings with the seasons. This helps your system work less and saves energy.

5. Listen for strange noises or changes in how your system runs. Early signs of trouble can help you fix problems before they get worse.

6. Make sure vents and registers are not blocked by furniture or curtains. This allows warm or cool air to move through your home.

7. Schedule professional inspections at least once a year. A technician will check refrigerant levels, electrical parts, and safety controls.

Tip: Regular maintenance helps you save money on energy bills and prevents unexpected breakdowns.

Service Life

You want your heating system to last as long as possible. Both heat pumps and furnaces can serve you well for many years if you take care of them. On average, you can expect the following service life:

Heat pumps often run year-round, so they may need more frequent checks. Furnaces usually work only in the colder months. If you keep up with routine care, both systems can reach the upper end of their lifespan. Regular maintenance is the key to getting the most from your investment.

Energy Efficiency

Heat Pump Efficiency

You may wonder how a heat pump saves energy. A heat pump does not burn fuel to make heat. It moves heat from one place to another. This uses less energy than making new heat. Modern heat pumps work well for both heating and cooling. You can check how efficient they are by looking at SEER and HSPF numbers.

A new heat pump can have a SEER rating up to 25. This means it cools your home using less power. For heating, HSPF ratings are usually between 7.7 and 10 or more. The higher the number, the better the system works. In most homes, a heat pump gives two to three times more heat than the electricity it uses. This makes it a good way to save energy, especially in places that are not too cold.

Tip: If your electricity comes from clean sources, a heat pump can help lower pollution.

Furnace Efficiency

A furnace makes heat by burning fuel or using electricity. The AFUE rating shows how much fuel turns into heat for your house.

If a furnace has an AFUE of 95%, it turns 95% of the fuel into heat. Only 5% is lost as waste. High-efficiency furnaces waste very little energy. In real life, a furnace gives steady heat but uses more fuel when it is cold. When you compare a furnace to a heat pump, think about how your electricity is made. Power plants lose some energy when making electricity, so the total efficiency can be close for both systems.

Note: How much energy you use depends on your weather, how well your home keeps heat in, and the size of your system. In cold places, a furnace may use more fuel, and a heat pump may need extra help to keep you warm.

Environmental Impact

Emissions

When you pick a heating system, you also pick how much pollution your home makes. A heat pump helps lower greenhouse gases more than a natural gas furnace. Over 15 years, studies show a heat pump can cut carbon dioxide by about 38% to 53%. The drop in global warming effect is even bigger, from 44% to 67%. These numbers count the fuel burned at home, methane leaks from gas, and refrigerant leaks from heat pumps. Methane leaks from gas furnaces add a lot to total pollution. Heat pumps will have fewer refrigerant leaks soon because of new rules. As the electric grid uses more clean energy, heat pump pollution will keep going down. Natural gas furnace pollution stays about the same over time. If you want to help the environment, switching to a heat pump is a good step.

Note: Each year, heat pumps help the environment more as the grid uses more renewable energy.

Clean Energy

You can make your heating system even better for the planet by using clean electricity. If you power your heat pump with renewable energy, your pollution goes down even more. Here are some ways clean energy helps:

• More renewables in the grid means less pollution from your heat pump.

• By 2050, as solar and wind grow, heat pump pollution will drop a lot.

• Hydrogen-powered heat pumps from green sources have an even smaller effect on the planet.

• Clean energy means we need less fossil fuel and keeps energy supplies steady.

• The whole process of making and using heat pumps gets better as the grid gets cleaner.

Even if your area still uses some fossil fuels, switching to a heat pump now helps lower pollution right away. Experts say waiting only slows down the benefits. Leaks from heat pumps are small compared to the savings from cleaner use. As the grid gets cleaner, your choice today will matter even more tomorrow.

Installation Needs

Space

You should think about space before picking a heating system. Heat pumps and furnaces need different places for their parts. A heat pump has an indoor and an outdoor unit. You need enough room for both. The table below shows how much space each system needs:

A heat pump needs more space inside and outside your house. Its radiators are bigger than furnace radiators. You also need to keep the area around the outdoor unit clear. This helps air move well. Furnaces usually go in a basement, closet, or garage. They do not need extra space for big radiators or an outdoor unit.

Tip: Always measure your space before you install anything. This helps you avoid problems later on.

Ductwork

Ductwork is important for your heating system to work well. Heat pumps often use the ducts you already have. But you must check if they are the right size and sealed tight. If ducts leak or are not insulated, you lose energy and comfort. Heat pumps sometimes need bigger ducts than air conditioners. This is because heating can need more airflow.

Think about these things when looking at ductwork:

• Heat pumps can use your old ducts, but they must be sealed and insulated.

• Ducts for heat pumps must work for both heating and cooling.

• Where you put registers and which way air flows matters for even heat.

• Ceiling ducts are okay if they are sealed and insulated, especially in attics.

• Furnace ducts are made for hot air and may not work as well for heat pumps unless you make changes.

If you choose a ductless heat pump, you do not need ducts at all. For ducted systems, always ask a pro to check your ducts before you get a new system. Good ductwork saves you money and keeps you comfortable all year.

Home Comfort

Air Quality

You spend most of your time indoors, so air quality matters for your health and comfort. Both heat pumps and furnaces affect the air you breathe. You can take steps to keep your indoor air clean and safe.

To improve air quality with your heating system:

1. Change air filters every 1 to 3 months. Clean filters stop dust and pollutants from spreading.

2. Schedule regular maintenance for your heat pump or furnace. This keeps the system running well and reduces allergens.

3. Keep vents and ducts clear. Good airflow prevents moisture and pollutant buildup.

4. Control humidity levels. This helps stop mold and mildew from growing.

5. Consider UV lights in your heat pump. These lights kill bacteria and mold spores in the air.

Heat pumps offer extra benefits for air quality. They do not burn fuel inside your home, so you avoid combustion byproducts like carbon monoxide. Electric heat pumps remove a source of indoor pollution that gas furnaces can create. Heat pumps also help control humidity, which keeps mold away. With proper care, you can enjoy cleaner air and better health.

Tip: Good air quality starts with regular filter changes and keeping your system clean.

Noise

Noise from your heating system can affect your comfort, especially at night. Heat pumps and furnaces sound different when they run.

Heat pumps run quietly most of the time. You may hear a gentle hum, like a refrigerator. In winter, the outdoor unit can get a bit louder during defrost cycles, but this only lasts a short time. Modern heat pumps use special technology to keep noise low and steady.

Furnaces often make louder noises when they turn on and off. You might notice bursts of air or a sudden whoosh, which can wake you up at night. If you want a quieter home, a heat pump usually gives you a more peaceful environment.

Note: If you value quiet, look for systems with sound-dampening features and schedule regular maintenance to keep noise down.

Picking a heating system depends on where you live, how much you want to spend, and your energy plans. Heat pumps are good for places that do not get very cold. They give comfort all year and cost less to use. Furnaces are better if you live somewhere with freezing winters or need a backup.

• Ask an HVAC expert to help you pick the right system.

• Look for rebates and special offers before you choose.

FAQ

How often should you service your heat pump or furnace?

You should schedule professional maintenance once a year. Change or clean filters every 1 to 3 months. Regular care helps your system run efficiently and last longer.

Can a heat pump replace both your furnace and air conditioner?

Yes, a heat pump can heat and cool your home. You get year-round comfort with one system. You do not need a separate furnace or air conditioner.

Do heat pumps work in freezing temperatures?

Modern heat pumps work well in cold weather. Cold-climate models keep your home warm even below 0°F. You may want backup heat for extreme cold.

Which system is quieter, a heat pump or a furnace?

Heat pumps usually run quieter than furnaces. You may hear a gentle hum from a heat pump. Furnaces often make louder bursts of air when they start.

What is the main benefit of choosing a heat pump?