Heat Pump Running Cost Calculator (Monthly & Annual)

Q: How much does a heat pump increase your electric bill?

If switching from a gas furnace, expect your electric bill to increase by $40–$80/month in winter while your gas bill drops to zero. The net savings are typically $40–$100/month overall. If switching from electric resistance heat, your electric bill will decrease since the heat pump is 2.5–4× more efficient.

Q: What is the cheapest temperature to set a heat pump?

Every degree lower you set the thermostat saves approximately 3% on heating costs. The cheapest comfortable setting for most people is 68 °F while awake and 62–65 °F while sleeping. With an inverter heat pump, avoid setting back more than 3–5 °F, as larger recovery periods reduce efficiency. In cooling mode, 76–78 °F is the most economical setting.

Q: How much does emergency heat cost to run?

Emergency heat (electric resistance strips) costs 2.5–4× more than normal heat pump operation. A 10 kW strip running for 8 hours costs $11.20 at $0.14/kWh. The same heating from a heat pump at COP 3.0 costs about $3.73. Never leave emergency heat on unless the heat pump compressor has actually failed — it's the most expensive way to heat your home.

Q: Can solar panels eliminate heat pump running costs?

A properly sized solar array (6–10 kW) can produce enough annual electricity to offset 100% of a heat pump's consumption. With net metering, excess summer production credits offset winter usage. The net annual heat pump running cost with solar can be $0 or close to it. (Pre-OBBBA, combining the 30% federal solar credit (25D) and heat-pump credit (25C $2,000) brought combined payback to 6–10 years; both credits expired Dec 31, 2025 under the OBBBA (PL 119-21, signed July 4, 2025) — 25D allows carryforward of unused pre-2026 credit, 25C does not. For 2026 installs, combined payback without the federal credits stretches to 10–15 years; state and utility solar/heat-pump incentives plus IRA HEAR (income-qualified) or HOMES rebates can pull this back toward the 7–11 year range for eligible households.)

Q: Why is my heat pump costing more to run than expected?

Common causes include backup strip heat activating too frequently (check the "aux heat" indicator), a dirty air filter restricting airflow, thermostat set too high, poor insulation causing excessive heating load, low refrigerant charge, ductwork leaks losing 20–30% of conditioned air, or the system being oversized and short-cycling. Start with the filter, then schedule a maintenance check.

The average heat pump costs $80–$160 per month to run for combined heating and cooling, or $960–$1,920 annually, in a typical 2,000 sq ft U.S. home. Your actual cost depends on your climate, electricity rate, heat pump efficiency, and thermostat settings. Use our calculator below for a personalized estimate, then compare against gas, oil, and propane systems.

Running Cost Calculator

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Pro Tip

Find Your Electricity Rate: Check your most recent electric bill for the "per kWh" rate. The U.S. average is $0.14/kWh, but rates range from $0.08/kWh (Louisiana, Idaho) to $0.35/kWh (Massachusetts, Connecticut, Hawaii). You can also look up state averages on the EIA website.

Average Running Costs by Climate Zone

Climate Zone	Example Cities	Annual Heating Cost	Annual Cooling Cost	Total Annual	Monthly Average
Zone 1 (Hot-Humid)	Miami, Key West	$42	$448	$490	$41
Zone 2 (Hot)	Houston, Phoenix, Tampa	$168	$392	$560	$47
Zone 3 (Warm)	Atlanta, Dallas, Charlotte	$336	$266	$602	$50
Zone 4 (Mixed)	NYC, DC, Nashville	$504	$238	$742	$62
Zone 5 (Cool)	Chicago, Denver, Boston	$728	$154	$882	$74
Zone 6 (Cold)	Minneapolis, Milwaukee	$952	$126	$1,078	$90
Zone 7 (Very Cold)	Duluth, Anchorage	$1,190	$56	$1,246	$104

All figures assume $0.14/kWh electricity rate. Adjust proportionally for your local rate — multiply by (your rate ÷ 0.14).

Monthly Cost Breakdown by Season

Heat pump running costs swing dramatically between seasons. Understanding the monthly pattern helps you budget and spot anomalies that might indicate maintenance issues.

Month	Mode	Est. kWh	Est. Cost	vs. Gas Furnace + AC
January	Heating	800–950	$112–$133	Saves $5–$20
February	Heating	700–850	$98–$119	Saves $5–$18
March	Heating	450–600	$63–$84	Saves $8–$22
April	Transition	200–350	$28–$49	Saves $10–$20
May	Cooling	250–400	$35–$56	Same or $5 less
June	Cooling	400–550	$56–$77	Same
July	Cooling	500–650	$70–$91	Same
August	Cooling	450–600	$63–$84	Same
September	Transition	250–400	$35–$56	Same or $5 less
October	Transition	200–350	$28–$49	Saves $5–$15
November	Heating	450–600	$63–$84	Saves $5–$18
December	Heating	700–850	$98–$119	Saves $5–$20

The biggest savings versus gas happen during shoulder months (March, April, October, November) when the heat pump runs at high COP (3.5–4.5) and gas furnaces still cycle at full blast for relatively mild temperatures. For mini-split-specific sizing (which dominates the run-cost math), the mini-split sizing calculator converts BTU demand into the outdoor units and modulation ranges that determine typical monthly draw.

Heat Pump vs Gas Furnace Running Costs

This is the comparison most homeowners need. The answer depends entirely on your local electricity and gas rates.

Scenario	Heat Pump Cost	Gas + AC Cost	Annual Savings	HP Wins?
Avg rates ($0.14/kWh, $1.30/therm)	$742	$1,276	$534	Yes
Cheap gas ($0.14/kWh, $0.80/therm)	$742	$932	$190	Yes
Cheap electric ($0.10/kWh, $1.30/therm)	$530	$1,236	$706	Yes, by a lot
Expensive electric ($0.22/kWh, $1.00/therm)	$1,165	$1,100	−$65	No (barely)
Very expensive electric ($0.30/kWh, $0.80/therm)	$1,590	$932	−$658	No
Moderate rates ($0.16/kWh, $1.50/therm)	$848	$1,420	$572	Yes
Oil/propane ($0.14/kWh, $3.50/gal oil)	$742	$2,310	$1,568	Yes, by a lot

Important

The Crossover Point: A heat pump's running costs are lower than gas in about 85% of U.S. markets. The heat pump loses only when electricity exceeds approximately $0.20/kWh AND gas is below $1.00/therm simultaneously. This combination exists in parts of the Northeast and some deregulated Texas markets.

Heat Pump vs Oil and Propane Costs

If you currently heat with oil or propane, the savings from switching to a heat pump are substantial.

Fuel Type	Annual Heating + Cooling Cost	Heat Pump Cost	Annual Savings
Heating Oil ($3.50/gal) + AC	$2,310	$882	$1,428
Heating Oil ($4.50/gal) + AC	$2,790	$882	$1,908
Propane ($2.50/gal) + AC	$2,095	$882	$1,213
Propane ($3.50/gal) + AC	$2,670	$882	$1,788
Electric Baseboard + AC	$2,940	$882	$2,058
Electric Baseboard (no AC)	$2,520	$882	$1,638

For oil and propane users, the heat pump typically pays for itself in 3–5 years — before accounting for any tax credits or rebates.

Electricity Rate Impact

Since the heat pump runs entirely on electricity, your local rate has a direct, linear impact on running costs. Here's how the same system's annual cost changes across the range of U.S. electricity rates.

Electricity Rate	States at This Rate	Annual Cost	Monthly Average
$0.08/kWh	LA, ID, WY, UT	$424	$35
$0.10/kWh	WA, OR, AR, ND	$530	$44
$0.12/kWh	TX, NC, TN, VA	$636	$53
$0.14/kWh	U.S. average, FL, GA, OH	$742	$62
$0.16/kWh	CO, AZ, MN, WI, IL	$848	$71
$0.18/kWh	MI, PA, NJ, MD	$954	$80
$0.22/kWh	NY, VT, NH, RI	$1,166	$97
$0.28/kWh	MA, CT	$1,484	$124
$0.35/kWh	HI	$1,855	$155

Pro Tip

Time-of-Use Rates Can Help: Many utilities offer time-of-use (TOU) rate plans where electricity is cheaper during off-peak hours (typically 9 PM – 7 AM). Since heat pumps run heaviest in the morning and evening, programming your thermostat to pre-heat or pre-cool during off-peak hours can reduce costs by 10–20%.

How to Lower Your Heat Pump Running Costs

These strategies can reduce your running costs by 15–35%, saving $150–$500 per year.

Smart thermostat setbacks: Drop temperatures 2–3 °F while sleeping or away. Inverter heat pumps respond best to small setbacks — avoid large swings (5+ °F) that trigger recovery mode. Expected savings: 8–15%.

Seal air leaks and insulate. The most cost-effective improvement. Focus on attic insulation (add to R-49 or R-60), basement rim joists, and weatherstripping around doors and windows. Typical cost: $500–$3,000. Expected savings: 15–25% on heating costs.

Keep filters clean. A clogged filter increases electricity usage by 5–15%. Check monthly; replace every 1–3 months. Cost: $5–$15 per filter.

Annual professional maintenance. A technician checks refrigerant charge, cleans coils, and verifies system operation. Cost: $80–$200. Expected savings: 5–10% by maintaining peak efficiency.

Use ceiling fans to distribute air. In heating mode, reverse your ceiling fan to push warm air down from the ceiling. This lets you lower the thermostat by 1–2 °F while maintaining the same comfort level.

Switch to a time-of-use rate plan. If your utility offers TOU pricing, schedule your heating and cooling during off-peak hours. Pre-heat the house in the early morning before peak rates kick in. Expected savings: 10–20%.

Key Takeaways

Key Takeaway

The average heat pump costs $80–$160/month or $960–$1,920/year to run for combined heating and cooling. Climate zone is the biggest cost factor — zone 1 averages $41/month while zone 7 averages $104/month. Heat pumps beat gas furnace + AC on total running cost in about 85% of U.S. markets. Savings are largest for oil and propane users at $1,200–$2,000/year. Smart thermostat settings, insulation, and maintenance can cut running costs by 15–35%. Time-of-use electricity rates offer an additional 10–20% savings opportunity.

Frequently Asked Questions

Is it expensive to run a heat pump all day?

Modern inverter heat pumps are designed to run continuously at low power, which is actually more efficient than cycling on and off. Running all day at 30–50% capacity costs less than running at 100% for half the day. A 3-ton inverter heat pump running continuously in moderate weather (40–55 °F) draws about 1.0–1.5 kW, costing $0.14–$0.21 per hour or $3.36–$5.04 per day.

How much does a heat pump increase your electric bill?

What is the cheapest temperature to set a heat pump?

How much does emergency heat cost to run?

Can solar panels eliminate heat pump running costs?

Why is my heat pump costing more to run than expected?

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