Comparing heat pump and furnace running costs

How do you compare running costs?

Put both fuels on the same footing, cost per kilowatt-hour of heat delivered. For a furnace, divide the gas price per kWh equivalent by its efficiency. For a heat pump, divide the electricity price by its seasonal COP.

A furnace at 95 percent efficiency delivers about 0.95 kWh of heat for each kWh of gas. A heat pump with a seasonal COP of 2.5 delivers 2.5 kWh of heat for each kWh of electricity. Electricity commonly costs several times as much per kWh as gas, so the heat pump's advantage can disappear or reverse, depending on the rates.

What does a worked example look like?

Assume a house needs 20,000 kWh of delivered heat a year. These rates are illustrative, not current prices.

• Gas furnace at 95 percent: 21,050 kWh of gas at an assumed $0.04 per kWh is about $840.
• Heat pump at a seasonal COP of 2.5: 8,000 kWh of electricity at an assumed $0.15 per kWh is about $1,200.

Under those assumptions the furnace wins. Change the electricity to $0.10 and the heat pump drops to $800, and the result flips. Many provinces have much cheaper hydro-based electricity or much dearer gas, which is why the same technology reads differently in Quebec and in Alberta. Replace the assumed numbers with the rates on your own bills, including fixed charges.

What else belongs in the comparison?

A heat pump also cools, so it can replace an air conditioner and its cost. Carbon pricing, delivery charges and future rate changes shift the comparison over time. Capital cost matters: see what a heat pump typically costs and how to check rebates. Equipment life also matters, because furnaces and heat pumps are both long-lived but not identical.

How does winter weather change the answer?

Efficiency falls as the outdoor temperature drops, so a cold stretch uses more electricity per unit of heat than a mild shoulder season. In a cold prairie climate the seasonal COP is lower than in a coastal one, and a hybrid arrangement, with the furnace taking the coldest hours, can capture most of the savings. That is the idea behind dual-fuel systems.

What did Drake Landing show about fuel cost?

At Drake Landing the heat came from stored summer sunshine, so the running cost was mostly pump electricity, and by the 2015-16 heating season the solar share had reached 100 percent, as the performance results record. That is the extreme end of the comparison, an energy source with almost no fuel price. It did not outlast the maintenance burden, since the system was wound down from about 2020, which is a reminder that low running cost and low lifetime cost are not the same thing.

What about emissions and comfort?

Cost is only one reason people switch. A heat pump burns no gas at the house, so its emissions depend on how the local grid is generated, which differs a great deal across the country. In a province with mostly hydro or other non-emitting power, the cut can be large; where the grid leans on gas or coal, it is smaller but still often positive because of the efficiency gain.

Comfort differs too. Heat pumps tend to deliver air at a lower temperature for longer periods, which some people find less drafty and others find less punchy than a furnace blast. They also cool in summer. The sizing guide explains why a correctly matched unit is the key to avoiding complaints on either side.

Remember also that the cheapest fuel can change. A house heated by gas today may face a different price ratio in ten years, in either direction, so a system that works acceptably across a range of rates is a safer bet than one that wins only at today's numbers.

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