Heat Pumps vs. Gas Heating Cost
So in the past, I crunched the numbers to determine how much heat my home actually needed, even on the coldest days of the year. That was step one. Step two? Figuring out whether switching to a heat pump made financial sense.
I had the raw energy requirements, but now I needed to translate that into electricity consumption using the Coefficient of Performance (COP) of a Mitsubishi Hyper Heat system. The system I was looking at had a COP that ranged from 2.0 at the lowest temperatures to 3.84 at milder temperatures. That meant that for every 1 kWh of electricity consumed, the system produced between 2 and 3.84 kWh worth of heat, depending on the outdoor temperature.
Adjusting for COP: How Much Electricity Would I Need?
Unlike a gas furnace that outputs a fixed amount of heat per unit of fuel burned, heat pumps are more efficient in milder temperatures and less efficient in extreme cold. With the COP data, I could calculate how much electricity a heat pump would need, by day, using my past natural gas consumption data as a baseline. For every day’s heating load, I adjusted the electricity requirement based on the COP at that temperature.
This let me answer the real question: Would heating my home with a heat pump actually save money?
Factoring in Energy Costs
Next, I factored in the actual cost of electricity and natural gas from my utility bills. Natural gas is cheap in my area, and electricity is also relatively affordable—but how do they compare when delivering the same amount of heat?
I converted both energy sources into a cost per kWh of heat produced so I could do a direct comparison. That meant calculating:
- How much I paid per therm of natural gas (factoring in delivery fees and taxes)
- How much I paid per kWh of electricity (including fixed fees and time-of-use variations)
- How much heat each energy source actually delivered
The results? On a typical winter day, the cost savings were significant. A day that required $3.55 in natural gas would have only cost 95¢ using a heat pump. That’s a huge win for electrification.
But then came the cold snaps. On the most extreme days, when the temperature dropped near 0°F and the heat pump’s COP fell closer to 2, the cost structure flipped in dramatic fashion. The gas furnace used about $14 worth of fuel, while the heat pump would have needed $72 worth of electricity to generate the same heat. That’s more than 5 times the cost, making natural gas the clear winner in those conditions.
The Yearly Cost Savings—And the Long-Term Payback
At the end of my first winter running this analysis, the numbers showed that a heat pump would have saved me about $300 over the season. The next winter, that number was closer to $150, due to shifts in gas and electricity prices and fewer extreme cold days.
While the savings were real, they weren’t overwhelming. The upfront cost of a heat pump system is significant, and based on these numbers, it would take about 10 years to break even—assuming no major price swings in energy costs.
The Big Picture: It’s Not an Obvious Decision
This analysis made one thing clear: a heat pump makes financial sense over the long term, but the advantage isn’t so overwhelming that it demands immediate action. Unlike in some regions where natural gas is prohibitively expensive, in my area, sticking with natural gas isn’t a foolish decision—it’s a reasonable, cost-effective option.
However, there’s still a path where a heat pump becomes the obvious choice—if I can further reduce electricity costs. The best way to do that? Generating my own power.
If I paired a heat pump with solar panels, I could reduce the cost of electricity and make heating far more economical. That turns a 10-year payback into something much more compelling.
The physics work. The costs make sense over time. But the real opportunity comes from taking control of the energy source itself.