The Cost and Carbon benefit of a Heat Pump: a real-world analysis
Last year, I replaced my home’s Air Conditioning (AC) unit with a Heat Pump (HP). Heat pumps are used to supplement furnaces in mild weather to save money vs. Natural Gas (NG) furnaces, and greatly reduce the carbon emissions of the home. This system with both HP and furnace is called a dual-source setup.
Many online sources will make vague claims about the benefits of dual-source. Now that I have a year of data with a dual-source setup, I wanted hard numbers on my real-world example: Did the heat pump reduce my heating cost and carbon footprint?
Methodology
I can’t simply compare year-over-year cost deltas because both the annual outdoor temperatures and natural gas prices are not consistent. Instead, I had to create a model that predicted the gas usage of the old all-furnace system so I could estimate what the gas usage would have been, if the HP had not been installed. For this, I fit three years of monthly natural gas usage vs daily temperatures. Here’s what I got:
The curve is a little contrived, so let me walk you through how to interpret this graph:
- On a given day, if the average temp is 57F (14C) or higher, no heat is needed that day.
- If the average temp is below 57F on a day, there is a linear relationship between how many degrees below 57F (called a Degree*Day) and the therms of NG needed (a 56F day requires 0.154 therms, a 55F day requires 0.308 therms, etc.)
- Sum up all the degree-days in a month, multiply by 0.154 to predict the therms needed to heat the house.
- Each of the dots represents a single month and the actual therms used on my gas bill vs. degree days for that month from 2020 until early 2022. R² = 0.94.
Heat Source Comparison
Let’s start with a comparison of my heating energy source of the old system vs the new:
Note that even with a Heat Pump, the furnace still provides >40% of my heat. Heat pump efficiency decreases as the indoor-outdoor temp delta increases. My heat pump doesn’t work below 28F (-2C) so most mornings in winter, and sometimes all day, the furnace is needed to heat.
Heating Cost Comparison
Using the monthly costs of electricity and natural gas, here’s a graph comparing the predicted costs of each throughout the heating season:
I’ve hidden the y-axis labels, but you can see that the dual source (HP+furnace) always outperforms vs. a furnace-only. Based on this data, I expect to save over $100 per year in heating costs.
Another unexpected benefit of dual-source is that it partially insulates against NG price variability. For example, the cost per therm in Dec was about 40% less than Jan while electricity costs are fixed.
Carbon Footprint Comparison
The real reason to switch to dual source heating is the positive environmental impact over an all-NG system. I subscribe to both community solar and green energy, so my electricity is emissions-free vs. 11.7 lbs (5.3 kg) of CO₂/therm of NG. Here’s the same data with lbs CO₂ on the y-axis:
Based on this data, I expect to reduce the carbon footprint of my household by about 3,000 lbs (1,360 kg) per year.
One big caveat: HP performance is dependent on many household-specific factors. It took me about a month of collection and analysis to determine the optimal efficiency settings. I did not meet an HVAC professional with the statistical proficiency or dedication to optimize my system. If you feel you are unable to get historical energy use information for your house and perform a similar analysis to mine, you may not be capable of optimizing your system to fully see these benefits.
Summary: it’s all upside
While heat pumps have some up-front install costs, it is feasible to save money, long-term vs. furnace-alone. If you already have clean electricity, upgrading to a heat pump is likely the next cheapest opportunity to profoundly reduce your carbon footprint. If you are considering getting a new air conditioner, I recommend you look into heat pumps, instead.
Happy to answer any questions in the comments. Please also check out my other articles on Heat Pumps and HVACs.
