Heating: what each fuel costs your house

Every heating comparison on this site comes down to one number: what a million BTU (MMBtu) of heat costs you, delivered inside the house. Natural gas at $1.55 a therm in a 92% furnace works out to $16.85 per MMBtu. Propane at $2.60 a gallon in an 85% furnace is $33.43. Electric baseboard at 18.4¢/kWh is $53.93. A heat pump divides that last number by its seasonal COP, which we set from your state's climate zone: from 3.6 in the warmest zone to 2.0 in the coldest state in our data. (US-average reference prices; your state's prices load automatically.)

Then we estimate how much heat your house needs in a year from its square footage, how well it's insulated and your state's heating degree-days (NOAA 1991–2020 normals). Multiply the two and you have a yearly cost for each option.

The results don't point one way. At reference prices, a 2,000 sq ft house with average insulation is cheaper to heat with a heat pump in Washington ($214.23 a year less than gas) and with a gas furnace in Minnesota ($1,047.61 a year less than a heat pump). Against propane, oil or baseboard, the heat pump usually wins; in Maine at 26.0¢/kWh, oil comes out slightly ahead.

2026 changed the payback math. The federal 25C and 25D tax credits ended for installations after Dec 31, 2025, so our payback calculators count only state programs (HEAR and HOMES where your state runs them) and utility rebates you enter. Every payback is an estimate, and every price and assumption on the page is editable. Sizing tools give you a first number from your state's design temperature; before you buy, ask the installer for a full Manual J.

2026 note: The federal 25C and 25D tax credits ended for installations after Dec 31, 2025. Our numbers use 2026 rules. State rebates, HEAR/HOMES programs and utility programs may still apply.