Trying to figure out if a gas furnace or a heat pump is cheaper in a mild winter? Here’s what we see most often at Filterbuy: in “not-too-cold” climates, heat pumps usually come out ahead because they move heat instead of generating it — but gas can still win when electricity rates spike or homes leak air like a sieve.
In this guide, we’ll cut through the noise with a real-world way to compare costs (based on your rates, your home’s efficiency, and how many truly cold nights you get). You’ll leave with a quick, practical check to estimate which option will cost less where you live — plus what to consider for comfort and long-term value.
Quick Answers
types of furnaces explained: gas vs. electric vs. oil vs. heat pump
Gas furnace: Burns natural gas to create heat. Often lower running costs where gas is cheap. Needs a gas line + venting.
Electric furnace: Uses electric resistance heat. Lower upfront complexity, but can be more expensive to run in many areas.
Oil furnace: Burns heating oil. Common in some regions without gas service. Requires a storage tank and fuel deliveries.
Heat pump: Doesn’t “make” heat—it moves it. Can heat + cool, and often costs less to run in mild winters.
Filterbuy take: The “best” option isn’t universal—it’s a zip-code decision. Your local $/kWh vs. $/therm (or oil price) and how well your home holds air/heat usually matter more than the equipment label.
Top Takeaways
Heat pumps often cost less in mild winters because they move heat efficiently.
Utility rates decide the winner. Compare $/kWh vs. $/therm for your area.
Home efficiency matters. Drafts, insulation gaps, and airflow issues raise costs either way.
Gas can still be cheaper when gas is low-cost, electricity is high, or backup heat runs often.
Do this next: Use your real rates + real winter temps to choose (zip-code math beats headlines).
What “mild winter” really means (and why it matters)
“Mild” usually means you spend most winter hovering above freezing, with only occasional cold nights. That’s the sweet spot where heat pumps shine because they don’t have to “work as hard” to pull heat from outdoor air.
If your winter days are mostly 40–60°F, heat pumps typically run efficiently. If your area regularly dips below freezing for long stretches, costs can shift depending on your setup (especially if backup heat kicks in).
The 3 factors that decide which one is cheaper
1) Your utility rates (this is the #1 driver)
A heat pump can be the cheaper choice or an expensive one depending on what you pay per kWh. Gas furnaces depend on your gas price per therm.
Rule of thumb:
Lower electric rates → heat pump advantage grows
Lower gas rates → furnace advantage grows
2) Your home’s efficiency (insulation + air leaks)
This is the sneaky one. A leaky home forces any heater to run longer.
From our perspective at Filterbuy, homeowners who improve airflow and reduce restriction (like keeping up with filter changes) often notice their HVAC system doesn’t strain as much — and while it won’t rewrite utility pricing, it can help your system operate closer to its intended performance.
3) Your system’s real-world performance
Heat pump efficiency is often discussed using COP or HSPF2 (higher is better).
Furnace efficiency is AFUE (90%+ is high efficiency).
If you’re comparing systems, it’s not “heat pump vs furnace” in general — it’s your heat pump model vs your furnace model.
When a heat pump is usually cheaper in mild winters
A heat pump often wins when:
Your winter temps are mostly above freezing
Your electricity rate is moderate/low
Your home is reasonably sealed and insulated
Your heat pump is newer/high-efficiency
Bonus: heat pumps can also handle cooling, which can increase overall value in many climates.
When a gas furnace can be cheaper (even in mild winters)
A gas furnace can come out ahead when:
Natural gas is inexpensive where you live
Electricity rates are high (or peak pricing is brutal)
You get frequent cold snaps and your heat pump relies on backup heat
Your home is drafty (big heat loss = longer runtimes)
A simple way to estimate costs without getting lost in the weeds
If you want a quick “which is cheaper for me?” check, focus on cost per unit of delivered heat, not the sticker price.
Here’s the practical approach:
Pull your electricity rate (kWh) and gas rate (therm) from a recent bill
Note your system efficiency (heat pump rating + furnace AFUE)
Consider how often you’re truly in “heating season” and how cold nights get
Use the result to pick the likely cheaper option for your zip code, not averages
“From what we see at Filterbuy, the ‘cheaper’ system in a mild winter usually comes down to the stuff homeowners don’t think about first — your real utility rates and how much heated air your home quietly leaks every day. When we help customers troubleshoot comfort and runtime issues, the biggest surprises aren’t the equipment labels — it’s the local pricing and airflow/efficiency basics that end up deciding the monthly bill.”
Essential Resources to Understand Furnace Types (Gas vs. Electric vs. Oil vs. Heat Pump) — The “No-Fluff” Reading List
U.S. DOE Energy Saver: Get the furnace basics + decode AFUE so you can compare systems confidently
If you’re weighing gas vs. oil vs. electric, this DOE guide helps you understand how furnaces work and why AFUE matters when you’re comparing efficiency (and long-term cost).
Source: https://www.energy.gov/energysaver/furnaces-and-boilers
U.S. DOE Energy Saver: Understand heat pumps fast (and why they’re different from “electric heat”)
This breaks down heat pumps in plain language—they transfer heat (like a refrigerator in reverse), which is why they can be an efficient alternative to furnaces.
Source: https://www.energy.gov/energysaver/heat-pump-systems
U.S. DOE Energy Saver: Avoid confusion around electric resistance (the expensive “gotcha” in many homes)
It explains why electric resistance can be “100% efficient” at the unit but still cost more to run due to how electricity is generated and delivered.
Source: https://www.energy.gov/energysaver/electric-resistance-heating
ENERGY STAR: See why heat pumps can cost less to operate (especially in mild winters)
This is a super scannable explainer that frames heat pumps in the way homeowners care about most: operating cost + year-round comfort.
Source: https://www.energystar.gov/products/energy_star_home_upgrade/clean_heating_cooling
IRS: Check federal tax credits before you buy (because incentives can change the “cheapest” choice)
Straight from the source—this page helps you confirm what heating equipment may qualify for the Energy Efficient Home Improvement Credit and what rules apply.
Source: https://www.irs.gov/credits-deductions/energy-efficient-home-improvement-credit
ACCA Manual J: Make sure your system is sized right (comfort + cost depend on it)
From what we see at Filterbuy, sizing mistakes are one of the biggest reasons people feel “meh” about a new system. Manual J is the recognized standard for proper load calculations.
Source: https://www.acca.org/standards/technical-manuals/manual-j
Montana State University Extension: Get a homeowner-friendly heat pump + mini-split overview
A clear, educational breakdown of heat pumps and mini-splits—helpful if you’re deciding whether a heat pump is a realistic swap for a traditional furnace in your home.
Source: https://www.montana.edu/extension/lila_extn/lila_fall_24/HeatPumpsAndMiniSplits.html
Supporting Statistics
Heat pumps can deliver up to 3× more heat than the electricity they use.
Filterbuy take: In mild winters, this “heat multiplier” is a big reason heat pumps often run cheaper—because they move heat instead of making it.
Source: https://www.energystar.gov/products/air_source_heat_pumps
New federal furnace standards take effect in late 2028 and require 95% AFUE for many gas furnaces.
Filterbuy take: As gas furnaces get more efficient by default, the “which is cheaper?” question leans even harder on your local gas vs. electric rates and how well your home holds heat.
In 2024, 47% of U.S. homes heated mainly with natural gas, while 42% used electricity.
Filterbuy take: That split is why there’s no one-size-fits-all answer—your “cheapest” option is often a zip-code decision, not a headline decision.
Source: https://www.eia.gov/todayinenergy/detail.php?id=66324
Final Thought & Opinion
If you’re comparing a gas furnace vs. a heat pump in mild winters, the “cheaper” choice usually comes down to your local rates + your home’s efficiency—not the equipment label. In many mild climates, heat pumps often win because they can deliver multiple units of heat per unit of electricity, but gas can still come out ahead when electricity is expensive or backup heat runs often.
Filterbuy opinion (real-world take):
Before you pick a system, ask: “How efficient is my home right now?” We consistently see cost and comfort problems tied to basics like airflow restriction, overdue filters, and homes that leak conditioned air filter—issues that can skew any “which is cheaper” comparison.
What to do next
Compare using your real $/kWh and $/therm
Factor in how many nights you spend near/below freezing
Tighten the basics (airflow + efficiency) so your comparison reflects reality
FAQ on “types of furnaces explained: gas vs. electric vs. oil vs. heat pump”
Q: What’s the difference between a furnace and a heat pump?
A:
Furnace (gas/electric/oil): makes heat, then blows it through ducts.
Heat pump: moves heat from outside to inside (and can reverse for cooling).
Q: Is an electric furnace the same as a heat pump?
A: No.
Electric furnace: usually electric resistance heat (often higher running cost).
Heat pump: transfers heat and can deliver more heat per unit of electricity.
Q: Which is cheapest to run: gas, electric, oil, or a heat pump?
A: It depends on your area.
Check your $/kWh (electricity)
Check your $/therm (natural gas)
Match it to your winter temps
Your zip code matters more than headlines.
Q: Are oil furnaces still a good option?
A: Sometimes—but they come with tradeoffs.
Fuel deliveries + storage tank
Fuel price swings
Often reconsidered at replacement time
Q: What should I prioritize when choosing a heating type?
A: Focus on the big 3:
Climate (how cold + how long)
Local energy prices (electric vs gas vs oil)
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