Key takeaways
- A heat pump heats and cools; a furnace only heats, so compare a heat pump against a furnace plus an air conditioner.
- Heat pumps are usually far more efficient; whether they’re cheaper to run depends on your electricity and gas rates.
- Only heat pumps qualify for Home Renovation Savings — up to $7,500 for non-gas homes, up to $2,000 for gas-heated homes.
- A hybrid system keeps your furnace as backup — a popular middle path for gas-heated homes.
At a glance
| Cold-climate heat pump | High-efficiency gas furnace | |
|---|---|---|
| Heats | Yes | Yes |
| Cools | Yes — replaces your AC | No — needs a separate AC |
| Efficiency | Typically 150–400% (COP 1.5–4) | Up to about 95–98% |
| Fuel | Electricity | Natural gas (or propane/oil) |
| On-site emissions | None | Burns fossil fuel |
| Typical lifespan | About 15 years | About 15–20 years |
| Home Renovation Savings | Eligible | Not eligible |
| Uses your ducts | Yes (ducted) or none (ductless) | Yes |
Upfront cost: compare the right things
The fair comparison isn’t heat pump vs. furnace. It’s heat pump vs. furnace + air conditioner, because the heat pump does both jobs. If your AC is near the end of its life too, the gap narrows further — and rebates can close it.
Running cost: it depends on your rates
A heat pump uses far less energy for the same heat, but electricity usually costs more per unit of energy than natural gas. Which is cheaper to run depends on your rates and your system’s seasonal efficiency. Our operating-cost guide has a calculator you can fill in from your own bills.
Switching from electric baseboards, oil or propane almost always lowers heating costs. Switching from natural gas is often close to break-even on heating — with cooling, rebates and comfort as the tie-breakers.
The middle path: hybrid (dual-fuel)
A hybrid pairs a heat pump with your gas furnace. The heat pump does all the cooling and most of the heating; the furnace takes over only on the coldest days, or when gas is the cheaper option.
- Keeps a proven backup for extreme cold
- Lets you use existing ductwork and furnace
- Qualifies gas-heated homes for $500/ton, up to $2,000
- Your thermostat picks the cheaper fuel automatically (with a compatible control)
How to decide
| If this sounds like you… | Consider |
|---|---|
| Electric, oil or propane heat | Full heat pump — biggest savings and rebate |
| Gas furnace under ~10 years old, AC failing | Hybrid: heat pump replaces the AC, furnace stays |
| Gas furnace and AC both at end of life | Heat pump with new furnace or electric backup — compare quotes |
| Radiators or baseboards, no ducts | Ductless heat pump |
| You only want the lowest price today | Like-for-like furnace (no rebate, no cooling) |
Common questions
Can I keep my furnace and add a heat pump?
Yes — that’s a hybrid system. The heat pump replaces your AC and handles most heating; your furnace becomes backup.
Is a heat pump louder than a furnace?
Indoors, a ducted heat pump sounds much like your furnace blower. Outdoors, it’s similar to a modern AC. See our noise guide.
Do I need to upgrade my electrical panel?
Not always. It depends on your panel size and whether you add electric backup heat. See electrical requirements.