Heat Pump vs Furnace (2026): Which Is Better?
Complete comparison of heat pumps and furnaces for home heating. Learn about efficiency, costs, climate suitability, and which system makes sense for your situation.
Quick Comparison Summary
Heat Pump
- • 300-400% efficiency (moves heat vs creates it)
- • $5,000-15,000 upfront cost
- • Heating + cooling in one system
- • Best in moderate climates (above 25°F)
Furnace
- • 80-98% efficiency (burns fuel for heat)
- • $3,000-7,000 upfront cost
- • Heating only (separate AC needed)
- • Works in any climate, including extreme cold
The HVAC industry wants you to think this decision is complicated. It's not.
Heat pump vs. furnace comes down to three questions: How cold does it get where you live? What do you pay for electricity vs. gas? And how old is your current system?
Answer those, and the decision usually makes itself. Let's walk through it—including what the salespeople won't tell you.
Heat Pump vs Furnace: Complete Comparison Table
Let's cut through the marketing. Here are the numbers that actually matter:
| Feature | Heat Pump | Furnace |
|---|---|---|
| Upfront Cost | $5,000-15,000 | $3,000-7,000 |
| Operating Cost (Annual) | $500-1,200 | $800-2,000 |
| Efficiency Rating | 300-400% (COP 3-4) | 80-98% AFUE |
| Lifespan | 15-20 years | 15-20 years |
| Climate Performance | Best 25°F+ | Works in all climates |
| Cooling Capability | Yes (included) | No (separate AC needed) |
| Environmental Impact | Very low emissions | Higher emissions |
| Maintenance | Moderate | Low to moderate |
What Is a Heat Pump?
Think of a heat pump as a reversible air conditioner. In winter, it pulls heat from outdoor air (yes, even when it's 20°F outside—there's still heat energy to extract) and moves it inside. In summer, it flips around and works like your AC, pulling heat out of your house.
How heat pumps work:
- Heat transfer technology: Uses refrigerant to absorb and release heat
- Reversible operation: Switches between heating and cooling modes
- Electric powered: Runs on electricity, no fossil fuel combustion
- High efficiency: Moves 3-4 units of heat per 1 unit of electricity used
Modern cold-climate heat pumps can operate efficiently down to -15°F to -25°F, making them viable even in northern states like Minnesota, Wisconsin, and Maine.
What Is a Furnace?
A furnace is a heating-only system that generates heat by burning fuel (natural gas, propane, or oil) or using electric resistance coils. The heated air is then distributed throughout your home via ductwork.
How furnaces work:
- Combustion heating: Burns fuel to create heat directly
- Forced air distribution: Blower pushes heated air through ducts
- Fuel types: Natural gas (most common), propane, oil, or electric
- Heating only: Requires separate air conditioner for cooling
Gas furnaces are the most common, with efficiency ratings ranging from 80% AFUE (older models) to 98% AFUE (high-efficiency condensing furnaces).
Heat Pump Pros and Cons
Pros
- Extremely high efficiency (300-400% vs 80-98% for furnaces) saves $300-800+ annually on heating costs
- Provides both heating and cooling in one system, eliminating need for separate AC unit
- Eligible for $2,000 federal tax credit plus state rebates (up to $10,000 total savings)
- No combustion means zero carbon monoxide risk and better indoor air quality
- Lower environmental impact, especially when powered by renewable electricity
- Quieter operation than furnaces (no combustion noise)
- Works in most U.S. climates with modern cold-climate models rated to -15°F or lower
Cons
- Higher upfront cost ($5,000-15,000 vs $3,000-7,000 for furnace)
- Efficiency drops in extreme cold (below 25°F), may need backup heat in coldest climates
- Requires electricity, so power outages mean no heat (unless you have generator/battery)
- May require electrical panel upgrade ($1,000-3,000) if home has limited capacity
- Shorter heating-mode lifespan in very cold climates due to increased compressor work
- Can accumulate ice on outdoor unit in certain conditions (though modern units have defrost cycles)
Furnace Pros and Cons
Pros
- Lower upfront cost ($3,000-7,000 for quality gas furnace)
- Reliable heat output in any climate, even extreme cold (-40°F and below)
- Faster heating and higher air temperature (120-140°F vs 85-95°F for heat pumps)
- Natural gas is often cheaper than electricity per BTU in many regions
- Well-understood technology with widespread contractor expertise
- No concerns about cold-weather performance degradation
- Gas furnaces work during power outages (if they don't require electric ignition)
Cons
- Lower efficiency (80-98%) means higher operating costs—$800-2,000 annually for heating
- Heating only—requires separate $3,000-7,000 air conditioner for cooling
- Produces carbon emissions, contributing to climate change and air pollution
- Carbon monoxide risk from combustion (requires detectors and proper venting)
- Requires natural gas line or propane tank, not available in all areas
- Combustion byproducts can affect indoor air quality
- No federal tax credits available (heat pumps get $2,000)
What the Heat Pump Salespeople Won't Tell You
Look, I recommend heat pumps to most people. But let's be real about the downsides:
They cost more upfront. A heat pump install runs $8,000-$15,000 vs. $3,000-$7,000 for a furnace alone. Yeah, the efficiency savings usually make up for it, but you need that cash (or financing) now.
Cold climate performance varies wildly. That "works down to -15°F" spec? That's for specific models from specific brands installed by contractors who actually know what they're doing. The cheap unit from the lowball bidder? Probably not one of them.
Your backup heat matters. In cold climates, you'll use emergency heat a few days a year. If that's electric resistance heating, those days get expensive. Make sure your system design accounts for this.
Not every contractor knows their stuff. Heat pumps require proper sizing, refrigerant charge, and airflow setup. A bad install performs 30-50% worse than it should. Get references for cold-climate installations specifically.
Cost Comparison: Heat Pump vs Furnace
The upfront numbers look scary. But here's what actually matters: total cost over the system's lifetime—installation plus operating costs for 15-20 years.
Upfront Installation Costs
Heat pump installation:
- Ducted heat pump: $8,000-15,000 installed
- Ductless mini-split: $3,000-5,000 per zone (single-zone), $5,000-12,000 (multi-zone)
- After federal tax credit ($2,000): $6,000-13,000 net cost for ducted system
- With state rebates: Can reduce cost by additional $1,000-8,000 depending on location
Furnace installation:
- Standard efficiency (80% AFUE): $3,000-4,500
- High efficiency (95%+ AFUE): $4,500-7,000
- Plus separate AC (if needed): Add $3,000-7,000
- Total heating + cooling: $6,000-14,000 for furnace + AC combo
When you factor in that a heat pump provides both heating and cooling, the upfront cost difference often disappears—you're comparing a single heat pump system to a furnace + air conditioner combination.
Annual Operating Costs
Your actual costs will vary based on your local rates, climate, and how well-insulated your house is. But here are typical numbers for a 2,000 sq ft home:
Heat pump annual costs:
- Mild climate (South/Southwest): $400-700/year heating + cooling
- Moderate climate (Mid-Atlantic, Pacific Northwest): $700-1,200/year
- Cold climate (Northeast, Midwest): $900-1,500/year
Furnace annual costs (heating only):
- Natural gas (national average $1.50/therm): $800-1,500/year
- Propane ($2.50-3.00/gallon): $1,500-2,500/year
- Electric resistance: $1,500-3,000/year
- Add separate AC: $200-600/year for cooling
10-year total cost comparison (including installation):
- Heat pump: $12,000 (install after rebates) + $10,000 (operating) = $22,000
- Furnace + AC: $10,000 (install) + $15,000 (operating) = $25,000
- Savings with heat pump: $3,000 over 10 years
Get Free Quotes from Vetted Installers
Compare prices from 3 licensed installers in your area. No obligation, no spam calls.
Get Free QuotesEfficiency Comparison: Why Heat Pumps Win
The efficiency difference between heat pumps and furnaces is dramatic and counterintuitive. While a 95% efficient furnace sounds impressive, a heat pump operating at 300% efficiency (COP of 3.0) is more than three times as efficient.
Understanding Efficiency Ratings
Furnace efficiency (AFUE): Annual Fuel Utilization Efficiency measures what percentage of fuel converts to heat. A 95% AFUE furnace converts 95% of gas to heat, with 5% lost through the exhaust.
Heat pump efficiency (COP/HSPF): Coefficient of Performance measures heat output vs electricity input. A COP of 3.0 means the heat pump delivers 3 units of heat for every 1 unit of electricity consumed—that's 300% efficiency.
How is this possible? Heat pumps don't generate heat—they move it. It takes far less energy to transport heat from outside to inside than to create heat through combustion or electric resistance.
Efficiency by Temperature
Heat pump efficiency does decrease in colder weather, but modern cold-climate models maintain strong performance:
- 47°F outdoor temp: COP 3.5-4.5 (350-450% efficiency)
- 32°F (freezing): COP 2.5-3.5 (250-350% efficiency)
- 17°F: COP 2.0-2.8 (200-280% efficiency)
- 5°F: COP 1.5-2.2 (150-220% efficiency)
- -5°F: COP 1.2-1.8 (120-180% efficiency)
Even at -5°F, a heat pump operating at 150% efficiency is still more efficient than a 95% efficient furnace. The crossover point where furnaces become more efficient typically doesn't occur until temperatures drop below -15°F to -25°F, depending on the heat pump model.
Climate Suitability: Which System for Your Region?
Climate is the single most important factor in choosing between a heat pump and furnace. Here's the breakdown by region:
Best Climate for Heat Pumps
Mild to moderate winters (Zone 1-4: South, Southwest, Pacific Coast):
- Heat pumps are the clear winner
- Average winter temps above 25°F mean maximum efficiency
- Significant cooling needs make dual-function capability valuable
- Examples: California, Arizona, Texas, Georgia, North Carolina
Moderate winters (Zone 5: Mid-Atlantic, Pacific Northwest):
- Heat pumps still excellent choice with cold-climate models
- Occasional cold snaps below 20°F manageable with backup heat strips
- Long cooling season justifies heat pump investment
- Examples: Virginia, Maryland, Seattle, Portland, New Jersey
Best Climate for Furnaces (or Dual-Fuel Systems)
Cold winters (Zone 6-7: Northern states):
- Dual-fuel systems (heat pump + furnace backup) often best
- Heat pump handles moderate temps (above 25-30°F), furnace kicks in during extreme cold
- Best efficiency at all temperature ranges
- Examples: Illinois, Ohio, Pennsylvania, Colorado
Very cold winters (Zone 7-8: Far North):
- Traditional furnace may still be best for heating-dominant climates
- Frequent temps below 0°F stress heat pump compressors
- Short cooling season reduces heat pump value proposition
- Consider dual-fuel or cold-climate heat pump models rated to -25°F
- Examples: Minnesota, Wisconsin, Maine, Vermont, Alaska
Get Free Quotes from Vetted Installers
Compare prices from 3 licensed installers in your area. No obligation, no spam calls.
Get Free QuotesWhich Heating System Should You Choose?
Here's how I'd think about it if this was my house:
Get a Heat Pump If:
- Your furnace is 15+ years old (replacement time anyway)
- You live in climate zones 4-7 (most of the US—anywhere south of Minnesota)
- You pay over $1.20/therm for gas OR under $0.15/kWh for electricity
- You want AC anyway (heat pump = free heating upgrade)
- You're staying 5+ years (payback usually kicks in year 3-7)
The federal $2,000 tax credit tips the math heavily in heat pumps' favor right now.
Stick With a Furnace If:
- Your current system is under 10 years old and working fine (if it ain't broke...)
- You're in zone 8 (Alaska, northern mountains) without backup heat options
- Gas is incredibly cheap (under $0.70/therm) and electricity is expensive (over $0.20/kWh)
- You're selling within 3 years (won't hit payback)
- Your panel needs a $4,000+ upgrade and you don't have the budget
Honest talk: Even in cold climates, modern cold-climate heat pumps work better than people think. But if your gas is cheap and reliable, sticking with what works isn't wrong.
Consider Dual-Fuel If:
- You're in zone 6-7 (Ohio, Illinois, Pennsylvania)
- Temps regularly hit single digits but not consistently below zero
- You have natural gas already and decent electricity rates
- You want the best of both worlds (efficiency + cold-weather reliability)
Dual-fuel is the "have your cake and eat it too" option. Heat pump handles 80-90% of your heating needs, furnace kicks in only on the coldest days. More expensive upfront, but maximum efficiency year-round.
Frequently Asked Questions
Are heat pumps cheaper to run than gas furnaces?
Usually, yes. Here's the math: Heat pumps are 3-4x more efficient than furnaces, which typically beats the price difference between electricity and natural gas. You'll spend $500-1,200/year running a heat pump for heating and cooling combined. A gas furnace costs $800-1,500/year for heating alone—plus another $200-600 if you want AC in summer. Total savings? About $300-800/year with a heat pump. But there's a catch: If you live somewhere with dirt-cheap natural gas (under $0.80/therm) and expensive electricity (over $0.18/kWh), the furnace might win. Check your actual rates before deciding.
How long do heat pumps last compared to furnaces?
Both systems last approximately 15-20 years with proper maintenance. Heat pumps may have slightly shorter lifespans in extreme climates because they run year-round (heating and cooling) compared to furnaces that only operate in winter. However, in moderate climates where furnaces would require a separate AC anyway, total system lifespan is comparable. Quality installation and annual maintenance are more important than system type for longevity.
Can a heat pump replace a furnace in cold climates?
Modern cold-climate heat pumps can absolutely replace furnaces in cold regions, with models rated to operate efficiently down to -15°F to -25°F. These units maintain 100%+ heating capacity at 5°F and continue providing heat even at -20°F. States like Maine, Vermont, and Minnesota have seen successful heat pump adoption. For the coldest climates (frequent temps below -10°F), a dual-fuel system (heat pump + furnace backup) offers maximum efficiency and reliability. The heat pump handles 80-90% of heating needs, with the furnace as backup during extreme cold.
What are the disadvantages of heat pumps vs furnaces?
The main disadvantages are: (1) Higher upfront cost ($5,000-15,000 vs $3,000-7,000 for furnace only), though this narrows when comparing to furnace + AC systems; (2) Reduced efficiency in extreme cold below 20°F, requiring backup heat in coldest climates; (3) Possible electrical panel upgrade needed ($1,000-3,000) if your home has limited electrical capacity; (4) Less familiar technology means fewer contractors with installation expertise in some areas; (5) Complete dependence on electricity, so power outages mean no heat without a generator or battery backup.
Conclusion: Heat Pumps Win for Most Homeowners
For the vast majority of U.S. homeowners—those living in climate zones 1-6, which covers roughly 80% of the population—heat pumps are the superior choice in 2026. The combination of extreme efficiency, dual heating/cooling functionality, substantial rebates, and lower operating costs makes heat pumps the clear winner for moderate climates.
Heat pumps make sense when:
- Winter lows rarely drop below 20°F
- You need both heating and cooling
- You're staying in your home 5+ years to recoup upfront investment
- You value energy efficiency and environmental impact
Furnaces still make sense when:
- You experience extreme cold with frequent temps below 0°F
- Natural gas is very cheap and electricity is very expensive
- You have minimal cooling needs
- Budget constraints make upfront cost the deciding factor
Consider dual-fuel systems when:
- You live in transitional climate zones with moderate winters but occasional extreme cold
- You want maximum efficiency at all temperatures
- Budget allows for the best of both worlds
The heating landscape has fundamentally changed. What was once a clear choice for cold climates—gas furnaces—now has strong competition from advanced cold-climate heat pumps. With generous federal tax credits ($2,000) and state rebates (up to $8,000 in some areas), 2026 is an excellent year to make the switch to heat pump technology for most American homes.
Get Free Heat Pump Quotes
Compare prices from certified HVAC contractors
Takes 2 minutes • No spam calls • Compare & save