Is electricity more expensive than gas for heating?
While electricity can cost more per unit than natural gas depending on your region, that’s only one part of the equation — and not the most important part. The real story lies in energy efficiency. High-efficiency gas furnaces are considered top performers when they convert about 95% of their fuel into usable heat. Sounds great, right? Until you compare it to a cold-climate heat pump. These advanced systems don’t just convert energy — they multiply its impact. Thanks to innovative inverter technology and the simple physics of heat transfer, modern heat pumps can achieve efficiencies between 200% and 500%. That means for every unit of electricity you use, you’re getting 2 to 5 units of heat delivered to your home. That’s a massive leap in performance.
So even if you’re paying more per kilowatt-hour, you’re using far fewer of them to keep your home warm and comfortable. It’s like paying premium fuel prices for a car that gets five times the mileage — suddenly, that higher cost per unit doesn’t matter so much. For many households, this shift leads to lower heating bills and fewer emissions. It’s just one of the many reasons people are making the switch to all-electric homes powered by heat pumps — not just for sustainability, but for real savings, too.
How do heat pumps work?
Heat pumps don’t magically lower electricity rates — but they do make every kilowatt-hour count. Instead of using energy to generate heat, like a furnace or electric resistance system, heat pumps use a small amount of electricity to move heat from one place to another. That might sound like a subtle distinction, but it’s a major reason why they’re so efficient. By transferring existing heat rather than producing it from scratch, they require far less energy to achieve the same result.
Think of it like getting triple — or even quintuple — the mileage from the same gallon of gas, but for your heating system. That’s the kind of performance difference we’re talking about. And the best part? This isn’t some niche technology — modern heat pumps work even in freezing temperatures, thanks to cold-climate engineering. So even in places where electricity costs more than gas, a heat pump’s smart, efficient design often turns the tables — delivering comfort and savings at the same time.
Why electric resistance heat is NOT the same as a heat pump
Electric resistance heat and heat pumps both run on electricity — but that’s about where the similarities end. Resistance heating (think baseboard heaters, space heaters, or older electric furnaces) generates heat by pushing electricity through wires or coils that get hot. That heat is then radiated into the room. It’s simple, but not especially efficient. For every unit of electricity you use, you get about one unit of heat in return. That’s a 1 : 1 ratio — no better than a gas furnace.
A heat pump, on the other hand, skips the energy-intensive step of creating heat altogether. Instead, it moves existing heat from the outside air (yes, even cold air has heat energy) into your home. And because moving heat takes a lot less energy than generating it, heat pumps can deliver 2 to 5 times as much heating for the same amount of electricity. So while both are technically “electric,” one is an energy guzzler, and the other is a high-efficiency powerhouse. It's like comparing a flashlight to a floodlight — the difference is night and day.
Can high electricity rates still be cheaper than gas heating?
Yes, and not just theoretically. In real-world homes, even in areas where electricity rates are higher, heat pumps can come out ahead on heating costs. Why? Because the amount of energy they use is so much lower. A modern cold-climate heat pump can produce 2 to 5 times more heat per unit of electricity than a gas furnace can deliver per unit of fuel. So even if the price per unit of electricity is higher, the volume you need is much lower — and that’s what really matters on your utility bill.
This math becomes especially favorable if you're currently heating with propane or oil, which tend to have much higher and more volatile pricing. In those cases, the switch to a heat pump can result in dramatic savings, not just modest ones. Add in available rebates, predictable costs, and the environmental benefits, and it's no wonder so many homeowners are seeing the shift to electric as a win-win.
How does the energy grid affect electricity prices?
Electricity prices are shaped by the grid — that massive, behind-the-scenes system that generates, manages, and distributes power to homes and businesses. Think of it as the nervous system of our energy world, constantly balancing supply and demand to keep the lights (and the heat) on. For much of its history, the grid has leaned heavily on fossil fuels like coal and gas. But in recent years, that’s been changing fast. Clean energy sources like wind, solar, and hydro are becoming a bigger part of the mix, making the grid cleaner, smarter, and more efficient.
And here’s where it gets exciting: as more renewable energy comes online, it doesn’t just cut emissions — it helps stabilize costs. Unlike fossil fuels, which can spike wildly based on geopolitics, supply shortages, or extreme weather, renewable energy offers consistency. Sure, short-term fluctuations still happen, but the long-term trend is heading toward lower carbon, higher reliability, and more predictable pricing. For households making the switch to all-electric heating, this cleaner, smarter grid is yet another reason to feel good about the future. It's not just where we're headed — it's already happening.
The takeaway? It’s not just about the sticker price of energy — it’s about how far that energy takes you. And with a heat pump, you're getting way more for your dollar. It's not just smarter heating. It’s future-proof comfort.