How to Estimate the Annual Heating Costs of Your Natural Gas Furnace

If your old furnace is on its last leg, you may be considering how much it will cost you to buy a new heating system. The furnace’s price tag is only one aspect of how much it will cost you to heat your home. Another important factor is the system’s annual operating cost. These tips will help you to estimate the annual operating cost for your new natural gas furnace.

Look at the Label
Manufacturers are required by the U.S. Department of Energy to explain what the unit’s estimated annual cost of operation is. This estimate is based upon ideal, laboratory conditions and not “real world” conditions. You can use this estimate as a best-case scenario of how much it will cost to heat your home per year.

Review the AFUE
The heating system’s annual fuel utilization efficiency explains how efficiently it converts natural gas into heat. If the unit has a 95% efficiency, then only $.05 of your heating dollar gets wasted.

You can refer to your past heating bills to find out how many cubic feet of natural gas you used. Use this number and your new furnace’s efficiency to calculate how many fewer cubic feet of gas the new heating system will use. Then multiply that number by the price per cubic foot that your utility company charges for natural gas.

Factors That Impact Operating Costs
All operating cost estimates for furnaces are based upon perfect installation and no heat loss. An improper installation could decrease furnace efficiency by up to 30%. Heat loss through loose or damaged air ducts and vents can lose another 20% in efficiency. Air leaks around doors and windows will also lower the furnace’s efficiency.

Heat & Cool Efficiently, energystar.gov

Furnace Efficiency, consumersearch.com


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