Keeping your home comfortable even when temperatures drop needs a good heating system, and selecting the right one requires some careful research. Two popular home heating systems in North America are heat pumps and furnaces. These systems can often be confused with one another, but they’re quite different. In this guide, we’ll discuss the unique attributes of heat pumps and furnaces, their pros and cons, and which one is best for your home.
On This Page:
- Forced Air Furnaces
- Electric Heat Pumps
- What are the Differences?
- Dual Fuel or Hybrid – Heat Pump and Furnace Combo
- Which is Best for Your Home & Location?
- How to Tell Which One You Have
- Other HVAC Systems
- Best Brands & Models
Forced air furnaces are one of the most popular heating systems installed in the US. They can run on electricity, oil, or gas. The key attribute of a furnace is that it uses a flame plus a medium (oil, gas, etc.) to distribute heat through air ducts and vents. When the air cools, it’s recycled back to the furnace to be reheated and redistributed. Here are the types of forced air systems available.
A gas system needs a pilot light or ignition to combust the gas for continuous heat. As a safety precaution, a heat exchanger blocks any dangerous combustion elements from entering the air. The cost of gas heating depends on the market prices. It’s usually delivered through an underground pipeline, so you won’t have to fuss with refilling a tank.
Electric resistance furnaces simply use electricity to heat the air and send it into your home. The blower and element activate when you turn up your thermostat to match the desired temperature. This system allows homeowners to avoid the chore of ordering propane.
These run on the same principles of combustion to heat the home. Fuel can come in the form of diesel (often called oil) or propane. Oil systems are old-fashioned and are common in older homes, while propane is its costlier but effective counterpart.
Electric Heat pumps are different from furnaces in one big way. There is no pilot light or combustion involved. Instead, external heat, pulled from outside or the ground, flows into the home. A compressor takes heat from the outside and uses a refrigerant to convert it into gas. This gas circulates through a coil that condenses the heat which heats the air, which the blower motor sends into the home. There are two main types of electric heat pumps.
This is an economic choice for mild climates as it does double duty as an air conditioner and heater. It draws on air from the outside and converts it to either hot or frigid air. This system is incredibly efficient when temperatures are above freezing but needs more energy to keep a home warm when temperatures fall below freezing.
Ground source units are also known as geothermal heat pumps. It functions just like the air source heat pump except that it draws heat from the ground. This is a more expensive unit but it’s also more efficient because it draws from the constant temperatures underground.
Heat pumps can also run on gas. Gas heat pumps, also called absorption heat pumps, run on a natural gas engine. Gas heat pumps differ from electric heat pumps in these ways:
- They don’t use refrigerants like electric heat pumps.
- Gas energy can be less wasteful than electric heat pumps if you live in an area where natural gas is affordable.
- Like electric heat pumps, they’re more efficient than furnaces in temperate climates.
No ducts? No problem. A mini-split, or ductless heat pump system, doesn’t need ducts. These systems come with an outdoor compressor and an indoor unit that sends hot or cold air into your home. A hole makes way for a conduit to connect the compressor to your home’s interior. Here are some of this its benefits.
- Stops energy loss through ducts.
- No ducts are good for people with allergies since no dust gets trapped.
- Mini Splits are ideal for add-ons or historic homes.
- It’s costlier to install than a standard heat pump.
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How do furnaces and heat pumps compare? This next section will compare all the different systems already mentioned in categories relevant to homeowners.
The best system for your property will depend on where you live.
- Pros: It’s over 100% efficient in temperate climates and can serve as both a heater and air conditioner. If your winters average around 30-40 degrees F, heat pumps are the perfect fit for your home.
- Cons: This system doesn’t fare well in extreme heat or cold. If there’s a huge temperature differential in either direction, it will need more energy to keep the desired internal temperature. Frost can also affect the outdoor compressor’s efficiency.
- Pros: Newer models can be up to 98% efficient in heating the home. They fare better in extreme climates because they don’t depend on the outdoor temperatures to convert to heat. If your winters are bitterly cold and have temperatures consistently below freezing, a furnace is the right system for your home.
- Cons: You’ll need a separate cooling system to beat the heat in the summer.
Winner in the south, and temperate climates: Heat Pump
Winner in the north and cold climates: Furnace
- Annual operating costs for highly-efficient models are around $850 for both heating and cooling. Expect the costs to go up or down depending on the size of your home and the quality of your heat pump system.
- Average heating costs per year for electric Heat pumps: $500.
- Average heating costs per year for geothermal heat pumps: $259.
- Energy efficiency will take a nose dive if the auxiliary heat ever activates, which can happen when temperatures fall below freezing. In fact, the electric strip backup costs up to 5x more than the regular heating mode.
- This system is great for cold climates because you won’t need to switch to auxiliary heat when temperatures drop.
- If you have harsh winters, you’ll save more money with a furnace since the heating system is more efficient below freezing than a heat pump.
- Fuel and natural gas prices will fluctuate based on market prices. Electricity is more stable in costs. Here are the costs for a season of heating a home:
- Propane: $1,550
- Natural gas: $850
- Electric resistance: $900
- Oil: $820
The winner: It’s a tie. Heat pumps are better for temperate climates, but furnaces are better for places with long, cold winters.
Which system has an easier installation process? Are either a DIY project?
- Pros: Though it’s possible to make this a DIY project, experts highly caution homeowners to not try a DIY heat pump installation unless they’re highly experienced.
- Cons: Installing this system from scratch is even more difficult than replacing an existing unit because it requires extensive knowledge. The average cost of a heat pump system alone ranges between $700-$2,800, while the system plus installation costs between >$5,000-$8,200.
- Pros: It’s possible to switch out a furnace yourself if you have the rest of the system already installed, but you’ll need some experience and the right tools to do the job well. The average cost of a furnace is around $660, with the system plus installation averaging at $1,950.
- Cons: If you need to install a furnace from scratch, please call a professional. The process is just as complicated as installing a heat pump. Proper installation will help avoid common pitfalls.
The winner: Furnaces. Though neither is a DIY project, Furnaces are cheaper to install professionally.
Which system takes up less space in your home?
- Pros: The bulk of this system is outside, but some components like the indoor coils and the backup heat are inside your home. In general, it’s slightly less intrusive than a furnace. Mini splits don’t need ducts, so they’re great for saving space indoors.
- Cons: You’ll need space in your home (basement, crawl space, mechanical room) for the indoor coil unit and any backup furnace.
- Pros: Newer systems are more efficient and take up less space than older models. If you live in a climate that rarely needs to use the air conditioner, you can get by with a furnace and window units.
- Cons: You’ll need to accommodate a fully functional furnace inside your basement, crawl space, or mechanical room. These are larger than the indoor components of heat pumps. If you need an air conditioning system, you’ll also need to devote space to it outside.
The Most Flexible Size: Heat pumps
Three acronyms can help you understand system or model energy efficiency:
- AFUE: Annual Fuel Utilization Efficiency. An AFUE of 85% means that 85% energy becomes heat, while 15% is lost. Note: a system’s AFUE doesn’t account for heat losses in ducts, which can be up to 35% more after the initial AFUE percentage.
- SEER: Seasonal Energy Efficiency Ratio. This scale, which starts at 1, measures the cooling output divided by electricity used. The higher the number, the more efficient it is. Only heat pumps and air conditioners use this scale.
- HSPF: Heating Season Performance Factor. This scale is basically the “SEER score” for heating. It’s only attributed to heat pumps.
- AFUE: In climates with moderate temperatures: over 100%.
- SEER: The new standard for heat pumps is 13 SEER which marks significant savings in cooling, but older units can have 8-10 SEER scores.
- HSPF: A standard heat pump has an 8.7 while a high-efficiency one has a 9.5, showing that it’s less efficient in heating.
- Furnaces only go by AFUE. The rate varies between 55% to over 95% AFUE depending on what type of fuel and furnace you use. Older and less efficient systems will fall between 56% to 70% AFUE. These are the rates for average efficiency furnaces.
- Gas: 80%
- Fuel: 80%
- Electric: 95%-100%
The winner: Heat pumps, especially newer models, but furnaces will have more efficient heating in extremely cold climates.
Which system is better for your utility bills?
- Pros: Heat pumps are a boon for your energy bills if you live in an area with winters that average above 35 degrees. In this case, homeowners can experience a system that’s over 100% efficient year-round with a newer heat pump.
- Cons: If you get an unexpected cold snap and have an inefficient backup system, expect to pay top dollar for auxiliary heating. It’s common for homeowners in traditionally warm climates to receive a $500 heating bill for just one month if they use auxiliary heat too much during a cold snap.
- Pros: If you live in a cold area, furnaces will keep you comfortable without the inordinate and unpredictable costs of a heat pump’s auxiliary heat. Oil and propane fuel deliveries will refill the tank on an as-needed basis.
- Cons: Costs for fuels like propane and natural gas can fluctuate, making the price of keeping a warm home costlier at various times. Homeowners should research which energy source is the most affordable for their area.
The winner: Heat pumps in temperate climates.
The winner: Furnaces in colder climates that have winters below freezing
Which system is more affordable to fix?
- Average cost to repair a heat pump: around $350 per incident, with higher costs peaking at $1,200 and low-end repairs around $70. However, the average repair range is $150-$550.
Forced Air Furnace
- Average cost to repair a furnace: Around $280 per incident, with $900 being a high-end cost, $60 low-end, and the typical range between $130-$450.
The Winner: Furnaces
Which system is safer?
- Pros: Heat pumps run on electricity, therefore they don’t have any CO2 risks.
- Cons: Electric heat pumps can leak refrigerant when idle. If this occurs, you should call a professional at once and have no contact with the liquid as it can cause health problems. You’ll know when there’s a leak when your system is not running well, but you should also get regular inspections.
Forced Air Furnace
- Pros: When it’s installed correctly, furnaces have backup protection systems that guard against fumes entering the home if the pilot does not light.
- Cons: If any backup systems fail, there are fumes and CO2 risks. Propane and gases have higher risks for explosions, while electric furnaces don’t carry that risk. Don’t use gas furnaces in small square-footage areas for these reasons.
Safety winner: Heat Pump
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Dual fuel or hybrid systems are best for homes situated between temperate and cold climates. Hybrid systems have the perfect backup heat that keeps your house sufficiently warm without burning expensive auxiliary heat. Though combo units are more expensive than regular heat pumps, you’ll win in utilities and comfort in the long run. Backup heating can come in three forms; a gas, fuel, or electric furnace unit. The furnace component can help you reach warm temperatures more quickly and affordably than auxiliary heat.
The quickest way to tell is to look at your thermostat. Do you have an emergency heat option? If so, you have a heat pump. If not, the signs point to having a furnace.
Heat pumps should be outside, while furnaces are usually in a basement, crawl space, or mechanical room, though they can be outdoors. When in doubt, look at the product label and do a quick Google search to confirm what kind of system it is.
Warm climates and coastal areas: Heat pump
States included in this area: California, Arizona, Montana, New Mexico, Texas, Oklahoma, Louisiana, Mississippi, Alabama, Georgia, Florida, South Carolina, North Carolina, Virginia, Kentucky, Tennessee, Hawaii, Missouri, Delaware, New Jersey
Temperate climates with some cold months: Combo/Hybrid system
States included in this area: Nevada, Utah, Kansas, Nebraska, Indiana, Ohio, West Virginia, Maryland, Pennsylvania, Iowa, Illinois, Maryland
For cold climates with a few warm months: Furnace with air conditioner or hybrid system
States included in this area: Colorado, Wyoming, Minnesota, North Dakota, South Dakota, Montana, Wisconsin, Michigan, New York, Connecticut, Rhode Island, Vermont, Maine, Massachusetts, New Hampshire, Washington, Oregon, Idaho
Gas packs are a combo/hybrid system that has both heating and cooling elements in the same unit. Electricity and the heating system power the air conditioning using propane, gas, or oil. Gas packs are also installed on roofs in areas where there’s little to no snow accumulation.
Convection heating systems are the predecessor to forced air. It’s like a forced air system without the help of a blower fan to move the warm air around. There are a few systems that use convection, like wall convection units, oil heaters, and electric baseboards. They send slow trickles of heat into a room and are better suited for small apartments or homes that rarely need a strong source of heat.
Radiant Heating from a Boiler
Boilers usually power radiant heating systems. They use water or steam instead of combustion. Boilers send steam or hot water through pipes to radiant baseboards, wall, floor systems, or coils. Radiant heating doesn’t send air through vents but simply heats a surface that emits a strong heat. Radiant heat warms up objects and people more quickly than it heats the air and is incredibly toasty in extremely cold climates where forced air loses too much efficiency through ducts.
Water Heaters or Hydronic Coil
Hydronic coil systems pump hot water through a heat exchanger that then heats the air in the home. This system is more common in Europe than in North America.
Convection baseboards run on electricity and are ideal for small rooms. They’re cheap to install but aren’t energy-efficient. They’re suited for climates where you don’t need heat often, as it only sends a small flow of heat in the room through a long metal framework through convection.
Heat Pumps vs. Air Conditioners
Heat pumps do double duty as heaters and air conditioners through the outdoor compressor taking heat from the outside (or ground) and converting it to hot or cool air with the help of a small indoor unit. Air conditioners, on the other hand, may look like a heat pump’s compressor but will only create chilly air.
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|Heat Pump||Furnace||Combo Units|
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