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| RUUD Heat Pump and Air Handler |
Our furnace and air conditioner are both 30 years old. They are the original equipment installed when the house was built; winter is coming and it's time to replace both of them. The lifespan of equipment like this is generally 15 to 20 years. Ours have exceeded the typical range significantly, but their age is showing, and the annual repair costs are now real.
Since they both need to go, we're considering a heat pump to replace them. Our 4-bedroom home uses methane (natural gas) for the furnace, cooktop, water heater, and (rarely used) fireplace. Soon after we moved in, our water heater needed to be replaced. This was over 20 years ago, so heat pump water heaters were not a viable option yet, so we installed a tankless water heater. It still used methane, but now it's not heating water 24/7, just in case one of us turns on a tap.
Similarly, with this furnace upgrade, I want to reduce our methane use, but it does not have to go to zero since gas is used in other parts of the home. If I were building a new home, it would certainly be all-electric, but this is a retrofit, and I'm happy with steps to reduce fossil fuel usage. Don't let the perfect be the enemy of the good, and all that; but let's see where the costs land.
When replacing your AC and furnace, there are a lot of options to consider. For cooling, if we have an AC unit or a heat pump, the energy usage would be similar, and electric is the only "fuel" option to run it, so let's call that a wash and look into the more complex side, heating. Heating has a lot of options. We could continue to use a furnace (upgrading to a new, more efficient unit), we could use a low-temperature heat pump (getting rid of the furnace completely), or we could do something in-between with a hybrid system that uses a standard heat pump as the primary heating source and a high efficiency furnace to cover the few subfreezing days and nights we have here.
Background and Assumptions
This analysis will compare home heating options for a 4-bedroom house in a Portland, Oregon, westside suburb. Your mileage may vary depending on your location, utility costs, home size, and factors like thermostat settings and insulation levels. These estimates consider the region's mild climate and current energy prices.
Our home is in a temperate climate with winter lows averaging around 34°F. The area is in USDA Climate Zone 8b. This zone is characterized by average annual minimum winter temperatures that do not go below 15°F. We have wet mild winters and warm dry summers, typical of the Pacific Northwest. It also aligns with ASHRAE Climate Zone 4C (cold, humid, marine), which is used for building energy standards, indicating cool winters with significant (2,500–3,000) annual heating degree-days (HDD) and with moderate cooling needs (unless there's a heat dome).
We have insulation typical of a 1990s build, requires an estimated heating load of 50 million BTU annually. Methane prices are set at $1.60 per 100 cubic feet. Regional electricity average of 13 cents per kWh. Methane contains about 1,030 BTU per cubic foot, and we use HSPF and AFUE ratings to convert heating demand into fuel and/or electricity needs.
The hybrid system uses the gas furnace only when temperatures drop to freezing or below. The heat pump will cover many more days per year of heating than the furnace, but the furnace will cover the coldest days (and nights) of the year. This pencils out to the furnace covering about 20% of the heating load, with the heat pump handling the remaining 80%.
Heating Options Overview
- Old Furnace: A 1994 Carrier gas furnace (model 58RAV115-16) with 80% Annual Fuel Utilization Efficiency (AFUE). As covered at the beginning, this is not an option to continue using, but it is included as a baseline.
- New Furnace: A RUUD R962V Endeavor Line Achiever Plus Series Gas Furnace with 96% AFUE.
- Hybrid (Dual Fuel): Combines a RUUD Heat Pump (4 Ton RD17AZ48AJ3NA, ~9.5 HSPF) with the RUUD R962V furnace, using the furnace below freezing.
- Cold Climate Heat Pump: An extended capacity heat pump (10 HSPF, ~3.5 COP at 47°F, ~2.5 COP at 17°F) with no furnace, relying entirely on electricity. May include resistive heating (electric) as a backup source.
Comparison Table
HEATING OPTIONS COMPARISON
Home in the Greater Portland, Oregon Region
| System | Methane Use (feet³) | Electricity Use (kWh/year) | Total Annual Cost (USD) |
|---|---|---|---|
| Old Furnace | 603,000 | 700 | $1,056 |
| New Furnace | 502,000 | 600 | $881 |
| Hybrid Heat Pump (Dual Fuel) |
100,400 | 1,434 | $346 |
| Cold Climate Heat Pump | 0 | 4,884 | $635 |
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Key Considerations
The hybrid system is the most cost-effective at $346 annually, leveraging the heat pump’s efficiency in the region's usually mild climate and minimal furnace use.
I admit the "Heat Your Home for Pennies!" portion of the title is clickbaitish, but when I saw that the result was less than $365 annually, that's less than a dollar per day! And I wanted to stress that point.
The cold climate heat pump, at $635, eliminates gas usage but increases electricity costs due to full electric heating. It takes more work to extract heat from cold air, but this is still a money-saving option compared to either furnace. The new furnace saves more than $150 per year over the old furnace due to higher efficiency, but this option would have the highest carbon footprint, and if we're replacing the AC unit anyway, there's no reason not to put in a heat pump while there are still incentives to do so.
The dual-fuel system gives us energy pricing resilience. It allows us to change the heat pump to furnace switch-over temperature. For example, if electricity rates climb significantly and gas does not, then we could adjust the switch-over point from 32°F to 34 or 35°F. This would use less electricity and more methane for heating during the coldest part of winter (but also increase our carbon footprint).
Even Better With Solar
As regular readers will know, we have solar panels and batteries on our home. Heat pumps, which run on electricity, pair exceptionally well with solar PV systems because they can utilize the clean, renewable energy generated on-site. The batteries allow us to time-shift our solar energy to avoid peak demand electricity rates. This means that when we are using the grid, we're buying energy at the cheapest off-peak rate. This will mean that our heat pump will be running directly from solar, from stored solar, or from off-peak grid energy. This will keep our heat pump running costs low. This heat pump / solar / storage synergy reduces strain on the grid and lowers CO2 emissions by displacing fossil fuel-based energy, especially in regions with coal and/or gas-heavy grids. This trio also helps mitigate HVAC cost volatility; generating your own power insulates you from fluctuating utility rates. If we were only using grid electricity for a new heat pump, I might regret installing it in a year or two if local electricity rates shot up. With solar, we have a guaranteed fixed cost.
When a heat pump is used for heating instead of a fossil gas furnace, renewable energy can directly displace the burning of fossil fuels.
Conclusion
Each heating system presents a different balance of cost, efficiency, and infrastructure requirements. Here is a quick summary:
- Old Furnace: High gas usage and cost, high maintenance costs
- New Furnace: Efficient, but still relies entirely on fossil fuels
- Hybrid System: Excellent performance in mild climates, lower carbon footprint than above. Flexible fuel choice.
- Cold Climate Heat Pump: All-electric, no gas needed, best for decarbonization, higher upfront cost and slightly higher running cost than hybrid
For our home, the hybrid system offers the lowest annual operating cost at $346, followed by the cold climate heat pump at $635. The new furnace ($933) and old furnace ($1,095) are less economical. Heat pumps provide environmental benefits, making them a forward-thinking choice for sustainable heating. I'm placing my order for the hybrid system now. Expect to see an install post coming soon.
Sources: NW Natural, Ruud Products, EIA Degree Days
| Option | Annual Energy Usage | Annual Operating Cost |
|---|---|---|
| Old Furnace | 603,000 feet³ of gas, 700 kWh of electricity |
$1,056 |
| New Furnace | 502,000 feet³, 600 kWh | $881 |
| Hybrid (Dual Fuel) | 100,400 feet³, 1,434 kWh | $346 |
| Cold Climate Heat Pump | 0 feet³, 4,884 kWh | $635 |
* Detailed Calculations
Old Furnace (Carrier 58RAV115-16)
With 80% AFUE, this furnace converts 80% of fuel energy into heat. The annual heating load of 50 million BTU requires an input of 50,000,000 / 0.8 = 62,500,000 BTU. Gas usage is 62,500,000 / 103,675 ≈ 603 CCF or 17,070 cubic meters. Electricity usage for the blower motor is estimated at 700 kWh annually. Operating costs include gas (603 CCF × $1.60 = $964.80) and electricity (700 kWh × $0.13 = $91), totaling approximately $1,095.
New Furnace (RUUD R962V)
The newer RUUD furnace offers a notable improvement in fuel efficiency, reducing gas consumption by over 100,000 cubic feet annually compared to the older unit. This results in yearly fuel savings. The electric blower fan and control systems are slightly more efficient, lowering electricity use as well. This option balances simplicity with better energy performance. The 96% AFUE furnace is more efficient, requiring 50,000,000 / 0.96 ≈ 52,083,333 BTU input. Gas usage is 52,083,333 / 103,675 ≈ 502 CCF, or ≈14,215 cubic meters. Electricity usage remains at 600 kWh for the blower. Costs include gas (502 CCF × $1.60 = $803.20) and electricity ($78), totaling approximately $881.
Hybrid (Dual Fuel) System
The heat pump covers 80% of the load (40 million BTU) with a 9.5 HSPF (~3.3 COP). Electricity usage is 40,000,000 / (9.5 × 3,412) ≈ 1,234 kWh. The furnace handles 20% of the load (10 million BTU) at 96% AFUE, requiring 10,000,000 / 0.96 ≈ 10,416,667 BTU, or 10,416,667 / 103,675 ≈ 100 CCF, or ≈ 2,832 cubic meters. Total electricity includes 1,234 kWh (heat pump) plus 200 kWh (furnace blower) = 1,434 kWh. Costs are gas (100 CCF × $1.60 = $160) and electricity (1,434 kWh × $0.13 = $186.42), totaling approximately $346.
Cold Climate Heat Pump
With no furnace, this system uses a heat pump with 10 HSPF (~3.0 COP average). The full 50 million BTU load requires 50,000,000 / (3.0 × 3,412) ≈ 4,884 kWh. No gas is used. The operating cost is 4,884 kWh × $0.13 = $635. Depending on electric resistive heating backup usage, this annual electricity usage and cost could be even higher.
Comparison Table
| Option | Energy Usage | Annual Operating Cost |
|---|---|---|
| Old Furnace | 621,090,000 BTUs, 700 kWh | $1,056 |
| New Furnace | 517,060,000 BTUs, 600 kWh | $881 |
| Hybrid (Dual Fuel) | 103,000,000 BTUs, 1,434 kWh | $346 |
| Cold Climate Heat Pump | 0 BTUs, 4,884 kWh | $635 |
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