Annual heating and cooling cost of an air-source heat pump from its SEER2 and HSPF2 ratings, compared with your current furnace and AC, using DOE’s method, EIA prices and payback
Updated October 2026
A heat pump’s ratings are in Btu of heating or cooling per watt-hour. So annual electricity = capacity (Btu/h) × hours of operation ÷ rating ÷ 1,000, done once for cooling with SEER2 and once for heating with HSPF2. This is the method behind DOE’s Federal Energy Management Program comparison. FEMP uses a 36,000 Btu/h (3-ton) heat pump and equivalent full-load hours by climate from DOE’s 2016 technical support document.
DOE’s worked example, reproduced. In the hot-humid Southeast, FEMP assumes 3,259 cooling hours and 854 heating hours. An ENERGY STAR heat pump at SEER2 15.2 and HSPF2 7.8 uses 36,000 × 3,259 ÷ 15.2 ÷ 1,000 = 7,719 kWh cooling, plus 36,000 × 854 ÷ 7.8 ÷ 1,000 = 3,942 kWh heating, for 11,660 kWh a year. At FEMP’s 11¢ per kWh that is $1,283. A less efficient 14.3/7.5 unit uses 12,304 kWh and a best-in-class 24/11 unit 7,683 kWh. The calculator reproduces every kWh figure in FEMP’s regional tables; the dollar figures match within $1.
Your current system is figured on the same load. The heat delivered is capacity × heating hours, converted to fuel through your furnace’s AFUE and EIA heat contents. Cooling is the same capacity and cooling hours divided by your AC’s SEER2.
Default. A 36,000 Btu/h ENERGY STAR heat pump in the Northern climate at 18.31¢ per kWh costs $2,012 a year. A 90% gas furnace on EIA’s 2025 average gas price ($15.34 per Mcf) plus a 14.3 SEER2 air conditioner costs $1,759: $734 for heat and $1,024 for cooling. At these prices the heat pump costs about $254 more a year to run than gas. Against propane, oil or electric resistance it saves money.
| Item | Value | Source |
|---|---|---|
| ENERGY STAR air-source heat pump | SEER2 15.2 / HSPF2 7.8 (FEMP’s comparison level) | DOE FEMP (Dec. 2024) |
| Best available in FEMP’s comparison | SEER2 24 / HSPF2 11 | DOE FEMP |
| Federal 25C credit | 30%, up to $2,000 a year for qualified heat pumps, for property placed in service through Dec. 31, 2025; ended after 2025 under P.L. 119-21 | IRS (updated Apr. 28, 2026) |
| Electricity | 18.31¢ per kWh, U.S. residential, July 2026 | EIA Electric Power Monthly |
| Natural gas | $15.34 per Mcf, U.S. residential 2025 average | EIA |
| Propane / heating oil | $2.689 / $6.190 per gallon, week of Oct. 19, 2026, before taxes | EIA weekly prices |
HSPF2 and SEER2 are measured under the DOE test procedure (10 CFR 430, subpart B, appendix M, as FEMP cites). A heat pump’s heating efficiency falls in very cold weather, so real bills in a cold climate can run higher than the rating suggests. Check your utility and state for heat pump rebates and enter any you will receive.
| Current system | Heat pump per year | Current per year | Result |
|---|---|---|---|
| Northern, gas furnace 90% + AC (default) | $2,012 | $1,759 | costs $254 more |
| Northern, propane furnace 90% + AC | $2,012 | $2,484 | saves $471 |
| Northern, oil furnace 90% + AC | $2,012 | $3,243 | saves $1,230 |
| Northern, electric baseboard + AC | $2,012 | $3,422 | saves $1,409 |
| Northern, older 7.5 HSPF2 heat pump | $2,012 | $2,115 | saves $103 |
| Northern, gas, best-in-class 24/11 heat pump | $1,354 | $1,759 | saves $405 |
| Hot-humid Southeast, electric furnace + AC | $2,135 | $3,152 | saves $1,017 |
| Hot-humid Southeast, gas furnace + AC | $2,135 | $2,008 | costs $127 more |
Switching from propane in the Northern climate saves about $471 a year at these prices. A heat pump that cost $10,000 more than replacing the furnace and AC would pay back in about 21.2 years. Against natural gas at the 2025 average, a standard heat pump costs more to run unless electricity is cheap, gas is expensive, or the unit is very efficient. Enter your own rates; they decide the answer.
It uses rated efficiencies and DOE’s typical hours, not a heating load calculation for your house. It does not model backup resistance heat in cold snaps, duct losses or dual-fuel systems. It also leaves out maintenance, a gas meter’s fixed monthly charge, electrical panel upgrades and future price changes. Size the equipment with a Manual J load calculation from a licensed contractor, get written quotes, and check current utility rebates before deciding.