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How Does a Heat Pump Save Me Money?

Are your heating bills costing you an arm and a leg? An energy-efficient heat pump may be able to save you money on your utility bills — especially if your home heating system is currently powered by a propane or electric furnace or electric baseboard heat. How, you may ask? It all comes down to the most efficient (and effective) way to use the electricity that you buy.

First… A short science (and math) lesson.

If you have an electric furnace or use electric baseboard heaters, every watt of electricity used generates just over 3 BTUs of heat. In northern Indiana or south-west lower Michigan, a typical 1,500 square foot home requires over 88 million BTUs of heat over the course of a winter. At the national average of $0.12/kilowatt, that means heating bills of almost $3,400/year!

Propane isn’t much better. While a gallon of propane generates about 90,000 BTUs of heat, some of that is “wasted” during the combustion process. Older, less efficient furnaces can send as much as $0.40 out of every dollar you spend on heating bills up the chimney. Even newer, high efficiency furnaces still send $0.02-$0.10 out of every dollar up in smoke. With an average, 80% efficient propane furnace will cost about $1,800/year to heat a typical 1,500 square foot home in our area.

Enter the energy-efficient heat pump!

Where an electric furnace generates just 3 BTUs of heat for every watt of electricity, an energy-efficient heat pump can generate 8-9 BTUs with that same watt (depending on outdoor temperatures). Unfortunately, the colder it is outside, the less efficient a heat pump becomes. In our climate, that means that you still need to have some sort of back-up heating source to keep your home warm on the coldest days of the year.

If your back-up heating source is an electric furnace, you can count on shaving 30-40% off of your heating bills — that’s $1,000-$1,400 per year in utility savings! Paired with an average, 80% efficient propane furnace, you could still expect to save 15-20% — a $250-$350 per year reduction.

What are the down sides of a heat pump?

Because they also provide air conditioning during the summer, heat pumps run virtually all year long. As a result, they don’t last as long as a furnace or an air conditioner — just 12-15 years on average. If you consider, however, the $3,000-$21,000 in utility savings over their lifetime, it’s still a great deal.

Another common complaint about heat pumps is that the air that comes out of the registers isn’t as warm as with a furnace — even though the systems rarely have a problem keeping the requested temperature on the thermostat. There have been advances in technology that have made the heat generated by heat pumps more comfortable, but it is still an issue for some people.

Is a heat pump right for me?

If you need to replace your furnace or air conditioner, you should definitely consider a heat pump. Because every home is different, it is best to have a trained professional come out to evaluation your specific situation. I’ve been doing these sorts of evaluations at Church Plumbing & Heating for almost 20 years at this point… I have found many customers that would benefit from a heat pump, and a few that won’t. Give me a call at (574)295-6844 and I’ll be happy to sit down with you to find out if a heat pump is right for your home.