How to read your result
A heat pump's value comes down to a simple comparison: what it costs to install and run versus keeping (or replacing) your current heating system. Because a heat pump moves heat instead of burning fuel, it delivers roughly 2.5–4 units of heat per unit of electricity — but whether that efficiency beats your local prices depends on three things.
1. Your electricity-to-fuel price ratio
Heat pumps run on electricity. If you currently heat with cheap natural gas, the running-cost savings can be small or even negative — this is normal and our calculator will tell you honestly. If you heat with oil, propane, or electric baseboard, a heat pump almost always wins big, often paying for itself in just a few years.
2. Your climate
A heat pump's efficiency falls as temperatures drop. In mild and moderate climates it runs efficiently year-round. In very cold climates, modern cold-climate models still work below freezing, but efficiency declines and backup heat kicks in on the coldest days, narrowing savings.
3. The "two birds" factor
A heat pump both heats and cools. If you'd otherwise replace a furnace and an aging air conditioner, the heat pump replaces both — dramatically improving the math, because you're comparing one purchase against two.
Frequently asked questions
Is there still a heat pump tax credit in 2026?
No federal tax credit. The Section 25C credit expired December 31, 2025. However, state-run HEEHRA rebates of up to $8,000 still exist in about 13 states for income-qualified households, and geothermal heat pumps keep a federal credit through 2032.
How long does a heat pump take to pay for itself?
Versus cheap natural gas, often there's little operating saving on heating alone. Versus oil, propane, or electric resistance, payback is frequently 1–4 years. Replacing both heating and AC at once shortens payback further.
Do heat pumps work in cold weather?
Yes. Modern cold-climate heat pumps operate efficiently well below freezing, with backup heat for the coldest days. Efficiency declines as it gets colder, which is why the savings case is strongest in milder climates.
Are heat pumps cheaper to run than a gas furnace?
Sometimes. They deliver far more heat per unit of energy, but if your gas is cheap and your electricity is expensive, a furnace can still cost less to run. Our calculator uses your state's actual prices to tell you which way it falls.