Heat Pump vs. Furnace: Which Is Right for Your Home?

How Heat Pumps and Furnaces Work

Gas Furnaces: Generating Heat

A gas furnace burns natural gas to create heat directly. The combustion heats a metal heat exchanger, and a blower fan pushes air over this exchanger and through your ductwork. Simple, effective, and time-tested technology that's been heating homes for decades.

Modern high-efficiency furnaces achieve 95-98% efficiency, meaning almost all the fuel is converted to usable heat. The exhaust exits through a PVC vent pipe.

Heat Pumps: Moving Heat

A heat pump doesn't generate heat—it moves it. Using the same technology as your refrigerator (but in reverse), a heat pump extracts heat from outdoor air and pumps it inside. Yes, even cold air contains heat energy that can be extracted.

The magic of heat pumps is that moving heat takes much less energy than creating it. A good heat pump can deliver 3-4 units of heat for every 1 unit of electricity used. This is why heat pumps are described as "300-400% efficient."

Efficiency: The Numbers That Actually Matter

Here's where it gets interesting. A high-efficiency gas furnace is 96% efficient. A heat pump is 300%+ efficient. But that doesn't mean a heat pump is automatically cheaper to operate.

What matters is the relative cost of electricity vs. natural gas in your area, and how efficiently each system operates at different outdoor temperatures.

Temperature and Efficiency

Heat pump efficiency drops as temperatures fall. At 47°F, a typical heat pump might have a COP of 4.0. At 17°F, that drops to around 2.5. Below that, some older heat pumps need backup electric resistance heat, which is expensive.

Good news: Modern "cold climate" heat pumps maintain good efficiency down to -15°F or lower. In the Pacific Northwest, we rarely see temperatures below 20°F, so modern heat pumps work extremely well here year-round.

Installation and Operating Costs

Upfront Costs

Here's what you can expect to pay in the Seattle area:

Yes, heat pumps cost more upfront. But keep reading—rebates and operating costs often flip the math.

Operating Costs

For an average 2,000 sq ft Seattle-area home, annual heating costs typically run:

• Gas furnace: $800 - $1,200/year (depending on gas prices)
• Heat pump: $600 - $900/year (depends on electricity rates)
• Electric resistance: $1,800 - $2,400/year (avoid this!)

Heat pumps also provide air conditioning, replacing a separate AC unit. If you'd otherwise buy an AC, subtract that cost from the heat pump price when comparing.

Rebates and Tax Credits

This is where heat pumps really shine. Current incentives make heat pumps extremely attractive:

Heat Pumps in the Pacific Northwest

The Pacific Northwest is nearly ideal for heat pumps. Our mild climate means heat pumps operate at peak efficiency for most of the heating season. We rarely see the extreme cold that challenges heat pumps in other regions.

Why Seattle Is Perfect for Heat Pumps

• Mild winters: Average winter temps of 35-45°F are ideal for heat pump efficiency
• Humid climate: Modern heat pumps handle humidity well, providing better comfort
• Warming summers: Heat pumps provide AC, increasingly valuable as summers get hotter
• Clean electricity: Washington's grid is 90%+ renewable, making heat pumps truly green
• Strong incentives: Local utilities offer some of the best rebates in the country

The Cold Snap Question

"But what about when it gets really cold?" We do occasionally see temps in the 20s or even teens. Modern cold climate heat pumps handle this fine. During the 2021 cold snap, properly-sized modern heat pumps kept homes comfortable even at single-digit temps.

If you're concerned, a hybrid system with gas backup provides insurance. But for most homeowners with a quality heat pump installation, it's not necessary.

The Hybrid Option: Best of Both Worlds?

A hybrid or "dual fuel" system combines a heat pump with a gas furnace backup. The system automatically switches between them based on outdoor temperature and energy costs.

How Hybrids Work

The heat pump handles heating above a "balance point" (typically 35-40°F), where it's more efficient than gas. Below that temperature, the system switches to the gas furnace. Smart thermostats can even optimize based on real-time energy prices.

Who Should Consider Hybrid?

• Homes with existing gas furnaces in good condition
• Homeowners nervous about all-electric in extreme cold
• Those wanting maximum flexibility for energy pricing
• Larger homes where backup heating provides peace of mind

That said, with modern cold climate heat pumps and Seattle's mild climate, many homeowners are going all-electric with no regrets.

Making the Decision

Choose a Gas Furnace If:

• •You have a tight budget and can't access rebates
• •You're selling the home soon (shorter payback needed)
• •Your home already has gas and no need for AC
• •You're replacing a failed furnace urgently in winter

Choose a Heat Pump If:

• You want both heating and cooling
• You can take advantage of rebates and tax credits
• You're planning to stay in your home 5+ years
• You want to reduce your carbon footprint
• You currently have electric resistance heat
• You're in a ductless situation (mini-splits excel here)

Consider Hybrid If:

• You have a functional gas furnace you want to keep
• You want maximum flexibility and backup
• Your home is larger and you want peace of mind