Heat Pump vs Furnace – Which Heating Unit Should Your Choose?

There are typically two types of heating systems to choose from: furnaces or heat pumps.  Whether you live in Santa Clarita, California or the colder climates of Montana, figuring out what type of heating system to use in your house can be a difficult decision, and we are often asked the pros and cons of these two systems.  So which should you choose, a heat pump or furnace?  The biggest factor in answering the heat pump vs furnace question is to first ask yourself what part of the country you live in.  Heat pumps, for instance, will typically only work in places with mild winters and are designed primarily for coastal regions in the southern states, whereas furnaces can brave even the harshest winter climates.  Those of you who read our articles regularly, know that we are a small, U.S. Veteran-Owned HVAC company in Southern California, and pride ourselves in giving people honest, straight answers to their questions.  But before we continue the heat pump vs furnace debate in more detail, we first need to take an in-depth look at each of these systems, and what they are designed for.  In this article, we will discuss heat pumps, then furnaces, and then show you how to figure out which is best for you and your climate.

First, How are Heat Pumps and Furnaces Measured?

Annual Fuel Utilization Efficiency (AFUE)

Before you tackle the heat pump vs furnace question, you first need to know how to compare the two.  Any type of heater, whether it is a gas furnace or an oil furnace, is measured using a rating called Annual Fuel Utilization Efficiency (AFUE).  The AFUE is an objective means of comparing two different types of heaters, and is shown as a percentage.  It can be thought of as kind of like a SEER rating for heaters.  For instance, an AFUE of 60% would mean that 60% of the fuel burned by this heater can be used as useful heat to warm your house, and the other 40% is wasted through your exhaust vent.  The higher the AFUE percentage, the more efficient the furnace or heat pump is.  Below is a chart that directly compares different types of fuel – as you can see, some fuels are far more efficient than others:


heat pump vs furnace AFUE comparison chart

AFUE Comparison – Wikipedia

More can be found on AFUE from Wikipedia: Wikipedia – AFUE Heat Pump vs Furnace Fuels.

Heat Pumps and SEER

“But Tim, why are you talking about SEER values in an article about heaters?”  Because a heat pump, which will be discussed in more detail later, is basically an air conditioner that has the ability to run in reverse, heating your house instead of cooling it.  A heat pump is 100% electrical…it doesn’t burn fuel like a furnace does, so it can’t be rated with AFUE!  Instead, it is measured the exact same way as your air conditioner – using a SEER value.

SEER stands for Seasonal Energy Efficiency Ratio, and it is a means of (poorly) measuring the efficiency of your air conditioner or furnace throughout the season.  I say poorly because it is based on laboratory measurements, in a controlled environment, and we still have not seen any of the high SEER units truly decrease electricity bills to the degree that they claim.  It is ranked on a scale between SEER 7 (no units less than SEER 7 still exist), and SEER 21 or 25 (or whatever the highest SEER on the market is at the time), with higher SEER values being more efficient.  On average, most heat pumps on the market are 14 0r 16 SEER.

For more on SEER and what it means, also look at:

heat pump vs furnace - how a heat pump worksWhat Is a Heat Pump?

Before we directly compare a heat pump vs a furnace, we will have to know the difference between them and how they work.  A heat pump is a machine that transfers heat from an area of cool air (called a “heat sink”) to an area that is warmer.  The most obvious application for this is to remove heat from the air outside of your house and transfer it into your home as a means of heating.  If you are familiar with how an air conditioner or refrigerator works, a heat pump is the same exact thing, only it can run in reverse.

Layman’s Definition: A heat pump is an air conditioner which has a reversing valve, allowing it to run in reverse, thus, heating your house instead of cooling it.

In fact, the term “heat pump” itself can be a bit misleading, as people often assume that it is only a means of heating a home, but the name actually refers to the fact that it transfers heat, not the direction it directs the heat.

In actuality, any heat pump can also be run in reverse, in which case it would be air conditioning your home.  Are all heat pumps air conditioners and vice versa?  In theory yes, but in practice, no they are not.  This is just a matter of the manufacturer’s preference and the intended use of the HVAC unit.

Simply put, all heat pumps are also air conditioners, but not all air conditioners are considered heat pumps (even though from an engineering standpoint, they are).  An air conditioner is just a heat pump that is specialized for hot weather operation.  If an air conditioner has a reversing valve and can be used as a heater too, then the unit is referred to as a “heat pump.”

Check out: How Air Conditioning and Heat Pumps Work

Save Money on Your New Heat Pump or Furnace by Watching This Short Video

For those who are soon to be in the market, this short video can show you how to save money on your new system, while avoiding the tricks and traps of predatory HVAC contractors:


Heat Pump vs Furnace – Heat Pump Pros as a Source of Heating

In the heat pumps vs gas furnace competition, heat pumps have quite a few advantages, the most notable of which is their energy efficiency (not to be confused with their cost to operate), with modern heat pumps ranging from SEER values of around 14 to over 21 SEER.  A heat pump uses electricity to transfer heat from one area to another, which means that it never has to generate heat itself.  It simply moves the heat that already exists from one area to another, such as from the outside of your home to the inside.  A heat pump is also more environmentally friendly because it requires no fossil fuels to heat your home.

However, efficiency is a relative term.  Heat pumps, although more efficient than most furnaces, are also more expensive to operate.  This is because electricity (used to power heat pumps) is typically more expensive than the natural gas or propane used to power furnaces.  As such, it is important to note that although a heat pump is more efficient (meaning it transfers more of the energy used directly into usable heat), it is usually still more expensive to operate than a furnace.  In short, what most of you think of as “efficiency,” really translates into dollar signs, and heat pumps can be expensive to run.  If it helps:

In most cases, an experienced HVAC technician will opt to install a furnace over a heat pump if they have access to natural gas.  The exception to this is when a home is located in the coastal areas of California and the gulf states.

Cons of a Heat Pump

So why aren’t heat pumps the standard for cold weather?  They seem almost too good to be true?  Well, there’s a catch.  Because heat pumps are transferring heat from one area to another, what happens if it is -20 degrees outside in the middle of a North Dakota winter?  Is there any heat to transfer into your house?  That’s the catch.

A heat pump only works well if the temperature is above freezing, and is almost useless in the middle of a harsh northern winter.  Ideally a heat pump is used when the temperature outside is over 50 degrees fahrenheit, so heat pumps are out if you live in Montana unless you also have a supplemental means of heating your house.  In fact, heat pumps are actually designed for coastal climates in the southern states.  So what do people in Bozeman, Montana do?  They use a furnace, or a wood-burning stove!

Pro Tip: People do, unfortunately, sometimes have to use a heat pump in cold weather climates.  This is usually because they don’t have access to natural gas or propane to install a furnace.  However, you can get away with this if you have electrical strip heat added to your heat pump.  This is an electrical coil (kind of like your blow-dryer) that stretches across the air flow inside of your heat pump.  When the temperature gets really cold, these turn on and keep your house toasty!

Additionally, the average lifespan of an air conditioner or heat pump is around 10-15 years, whereas a furnace is upwards of 20-30 years (National Association of Home Builders – “Life Expectancy of Home Components”).  Although this should not be the basis for your decision, it is worth keeping in mind.  This is due to the relative complexity of each type of heating unit.  Air conditioners and heat pumps are far more complex than modern furnaces, and typically suffer more wear and tear, especially in the case of heat pumps, which run both in the summer and the winter.  Food for thought.

Heat pumps can also suffer from Dirty Sock Syndrome, so make sure you learn proper sanitization for your heat pump before you even turn it on:

furnace vs heat pump - maytag furnaceWhat is a Furnace?

Here is where the heat pump vs furnace discussion really becomes clear.  A furnace uses a fuel to generate its own source of heat and then circulates this heat throughout your house.  There are many types of furnaces, including gas furnaces, oil furnaces and electric furnaces, all of which have their pros and cons but essentially accomplish the same thing – they utilize a fuel to burn as a means of heating the air inside of your home.

Also see:

Heat Pump vs Furnace – The Pros of a Furnace as a Means of Heating

The biggest pro that a furnace has is that it will heat your home in any condition, regardless of outside temperature.  If it is 50 degrees out or -10, a furnace will burn it’s fuel and heat your home.  This reliability is priceless if you live in colder regions like Bozeman, Montana.

Another pro in the furnace category is the initial investment price.  A furnace is generally around $500 to $1000 cheaper than a heat pump when installed, not including any duct work.  That’s not chump-change.

Cons of a Furnace

The biggest argument against the use of a furnace is the cost of fuel.  Depending on the type of furnace that you purchase, you can be spending thousands of dollars a year on fueling your furnace.  In most cases, a gas furnace will be significantly cheaper to operate than a heat pump, but do you have access to natural gas?

I’d recommend you take a look at the most common types of fuel for your area because even though you might plan on buying a gas furnace there might not be gas available in your area.  Don’t just assume that the fuel you use to heat your home is your choice.  A lot of it depends on the infrastructure of your area.

heat pump vs furnace annual heating cost chart

As you can see, propane is twice as expensive as some of the other fuels, so do some research on your area.  Furnaces also have a large range of efficiency, ranging from AFUE ratings of 55% to over 95% depending on what type of fuel and furnace you use, as well as how much insulation you have in your house.  Again, this is as much of an art as it is a science, but don’t just assume that whatever your neighbor uses is the best type for your region.

For more information on proper insulation:

Heat Pump vs Furnace – Which Should You Choose?

The biggest factor that should be used to examine the heat pump vs furnace debate is the region you live in.  In general, if you live in Bozeman, Montana or any northern states that endure harsh winters, then a furnace will be your best option.  If you live in Santa Clarita, California or some of the southern states that only rarely dip below freezing, then you can consider using a heat pump, but I still feel that a furnace is the better option for your home.  Here is a rule-of-thumb temperature range that you can use:

heat pump vs furnace climate zone map

Heat Pump Zoning Chart for Use of Supplemental Electrical Strip Heat

Heat Pump – Average Winter Temperature > 40 Degrees Fahrenheit.

Furnace – Average Winter Temperature < 40 Degrees Fahrenheit.

It is important to note that although a heat pump itself does not work well below 50 degrees, you can purchase heat pumps that have a hybridized approach.  They accomplish this by incorporating an electrical strip heat source for use if the temperature drops below the ideal range for your heat pump.  This is useful to know if your winter climate is somewhere in between the furnace and heat pump ranges, or if you live in an area that does not have access to natural gas or other fuels.

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Look, at the end of the day, go with whichever unit works best for your situation.  If you have an existing unit, then there are very few cases in which switching from a heat pump to a furnace will be beneficial, and vice-versa.

Before making your decision, I’d highly recommend that you take advantage of our HVAC Design & Consultation Program.  With it, you’ll be able to look up the prices for different brands and models of both heat pumps and furnaces, as well as get fair installation prices, price breakdowns, sizing information, and so much more.  I won’t beat a dead horse; click below for more information:


Final Thoughts on the Heat Pump vs. Furnace Debate

The heat pump vs furnace debate is a difficult decision to make, but hopefully you now know some of the pros and cons of each.  In general, the bigger factor that should be used in your decision is the region you live in.  If you have cold, snowy winters, go with a furnace.  If you have mild winters like in California and Florida, then consider a heat pump or a furnace.  For more information on related topics, visit the ASM Air Conditioning Blog.  ASM is based in Santa Clarita, Los Angeles  if you live in our area, don’t hesitate to give us a call with any questions you might have – we’d be happy to help you: