Heat Pump Savings Calculator — vs Gas Furnace Comparison
Calculate how much you'd save by switching from a gas furnace to a heat pump. Includes annual savings, payback period and CO2 reduction.
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How to use this calculator
- Enter your annual gas usage in therms (check your gas bill — annual total).
- Enter your current gas price per therm.
- Enter your electricity rate — heat pumps run on electricity.
- Set the heat pump COP (Coefficient of Performance) — higher is more efficient.
- Results show your annual savings and payback period after the 30% federal tax credit.
Understanding your results
How the savings calculation works: A gas furnace burns natural gas at roughly 100,000 BTU/therm. At 80% efficiency, you get 80,000 usable BTU per therm. A heat pump with COP 3.0 delivers 3 units of heat per unit of electricity — meaning 1 kWh (3,412 BTU) of electricity produces 10,236 BTU of heat. The calculator converts your gas usage into equivalent electricity need, then multiplies by your electricity rate to find heat pump running cost.
The 3× rule for heat pump economics: Heat pumps save money when electricity costs less than approximately 3× the per-BTU cost of gas. At $1.20/therm gas and $0.14/kWh electricity, the electricity-to-gas cost ratio is 2.1× — well below 3×, making heat pumps cheaper to run. At $0.30/kWh electricity, the ratio rises to 4.6× — favouring gas in most climates.
Cold climate heat pump performance: Modern inverter-driven heat pumps (Mitsubishi Hyper Heat, Bosch IDS, Carrier Infinity) maintain 70–80% efficiency at 5°F (-15°C) and operate down to -13°F (-25°C). Older single-stage heat pumps lost effectiveness below 30°F. This distinction is critical for homeowners in Minnesota, Maine, Wisconsin and other cold-climate states.
IRA heat pump incentives in 2026: The Inflation Reduction Act’s Section 25C Energy Efficient Home Improvement Credit provides a 30% credit (up to $2,000) for qualifying heat pump HVAC systems. The HEEHRA program provides direct rebates up to $8,000 for income-qualified households. Combined, these can cover 40–60% of a heat pump installation for eligible buyers.