Heat Pump vs. Propane Furnace for Your Home Heating
Last edited
Author
Andrew Blok
Electrification and Solar Writer and Editor
Editor
Andrew Giermak
Solar and Electrification Writer and Editor
If you live in a part of the country with long, cold winters, you may rely on propane heating to keep your home warm. It’s a common setup, but modern technology has improved the options.
High-efficiency heat pumps are now a viable option for more homeowners and climates than ever before. Choosing a heat pump typically means higher energy efficiency, the convenience of having both heating and cooling in one reliable system, and, potentially, lower bills. When paired with home solar panels, it’s also one of the cleanest ways to power your home.
See how much you can save with a new HVAC system from Palmetto
What is a heat pump?
Heat pumps use electricity to move — instead of generate — heat into or out of a home or building. A main benefit with a heat pump is it provides heating and cooling in one system.
Heat pumps are very energy efficient. As a result, the US Department of Energy found, most Americans could lower their bills by switching to one. Heat pumps can also reduce the cost of home maintenance, since you only need to care for one machine instead of two. A heat pump is the most energy-efficient HVAC option for a large majority of US homes and in nearly all climates in the country.
Air source heat pumps run at about 300-400% efficiency, transferring three or four times the thermal energy as the energy (electricity) used. Geothermal heat pumps can reach over 500% efficiency.
How propane heating works
Propane heating for a home works similarly to heating with natural gas and a furnace, but is often used on properties without access to natural gas. A propane user must store propane in a tank on their property. The gas runs to a furnace where it is burned to heat the home. Propane heating systems have an efficiency rate up to about 98.5%.
A propane storage tank in need of a wash. Photo by Randall Mann via Unsplash.
The price of propane depends on supply and demand, geographic region, and by the company providing it. The average price of residential propane gas in the US in recent weeks was about $2.65 per gallon according to the US Energy Information Administration. Demand and prices generally rise in the winter.
Rural areas with longer, colder winters use propane heating most. The upper midwest and plains states, Wisconsin, Minnesota, Iowa, and the Dakotas, along with some usage in New England, make up most propane heating use in the US. According to the Energy Information Administration, 9% of US homes use propane for heating or at least one appliance. North Dakota and Vermont use propane the most.
Users store propane in a large tank on their property. You can use propane to power water heaters, ovens/stoves, dryers, and fireplaces.
Propane heating emits greenhouse gases and pollutants. It must be safely stored, as it’s flammable, and the venting must work safely and properly. It is less efficient and generally more expensive than using a heat pump for heating.
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Propane furnace vs. heat pump
Modern heat pumps are an energy-efficient and cost-effective heating and cooling option for more homes in more regions and climates than ever before. Cold climate heat pumps are built, tested, and certified to work and maintain a high level of efficiency down to very cold temperatures. Heat pumps are also safer and run on much cleaner energy — including home solar power.
Comparing the utility cost between a heat pump and propane heating, the US Department of Energy found an annual savings range of $889-$2,811 with a heat pump. In Michigan, the DOE found homes switching from propane or older electric heating to a cold climate heat pump could save an average of $1,500 a year.
How could a heat pump be a better year-round heating and cooling system for your home?
| Heat pump | Propane | |
|---|---|---|
| Efficiency | Often 300-400%, can be over 500% especially with geothermal heat pumps | Up to 98.5% |
| Functionality | Heating and cooling | Heating |
| Fuel source | Electricity | Fossil fuel |
| Fuel tank | No | Yes |
| Emissions | Lower (with grid electricity) or lowest (with home solar panels) | Higher |
Will a heat pump work for you?
A heat pump could be your year-round answer for home heating and cooling and deliver energy savings, especially if you combine it with home solar panels. It pays to consider your usual heating and cooling use, your local utility rates, and any incentives you may qualify for.
If a heat pump seems like a good idea, but a large upfront expense doesn’t, a heat pump lease could be your best option. The Palmetto Comfort Plan, gives you a modern, efficient heat pump with no cost upfront and most service and maintenance included for the life of the lease.
Explore your options with Palmetto’s HVAC advisor. Or, download the free Palmetto app and get personalized insights into how your home uses energy, find ways to save energy and money, and earn discounts on devices that can improve your home’s energy efficiency (including a new heat pump!).
See how much you can save with a new HVAC system from Palmetto
Frequently asked questions
If my home uses propane, will switching to a heat pump save me money?
According to research from the Department of Energy, switching from propane to a heat pump often reduces energy bills. In Michigan, DOE found that the average home switching from propane or older electric equipment to a cold climate heat pump could save $1,500 a year on average. Whether you save and how much depends on the local cost of propane and electricity and your heating habits.
What’s the most efficient way to heat a home?
Heat pump heating and cooling is the most efficient HVAC system for most homes in most areas and climates. It’s important to take certain factors, such as home size, your area energy rates, and your heating and cooling usage, into account when replacing your heating with propane, heat pump, or another system.
Can heat pumps replace propane in cold climates?
Heat pumps, specifically certified cold climate heat pumps, are tested to work and maintain high efficiency in temperatures at or below zero. Heat pumps work in a wider range of climates than ever before.
Disclaimer: This content is for educational purposes only. Palmetto does not provide tax, legal, or accounting advice. Please consult your own tax, legal, and accounting advisors.
Lead photo by Eric Prouzet on Unsplash.
