Heat pump savings calculator

A heat pump wins by moving heat instead of making it. Whether that beats your current fuel comes down to one comparison — and the federal credit that used to paper over the gap is gone.

§25C expired

The Energy Efficient Home Improvement Credit, worth up to $2,000 for a qualifying heat pump, ended for property placed in service after December 31, 2025. Quotes and calculators still applying it are overstating the case by that much.

State

What you heat with now

Annual heating use (therms)From last winter's bills

Price per therm ($)

Current system efficiency: 80%AFUE on the nameplate. 100% for electric resistance.

Heat pump seasonal COP: 3.00Whole-season average including backup heat — not the 47°F nameplate figure

Extra cost over a like-for-like replacement ($)Only the difference counts when the old system is dying anyway

My current system needs replacing anyway — so charge the heat pump only the difference in price, not the whole thing.

You need a seasonal COP of 4.22 just to break even on running cost. At 3.00 it falls short, so it will cost about $456 more to run each year than what you have now.

Heat your home needs	16,408 kWh of heat per year
Electricity the heat pump needs	5,469 kWh per year
Cost of heat now	$0.0683 per kWh of heat
Cost of heat with the heat pump	$0.0961 per kWh of heat

Assumptions and caveats

No federal tax credit is applied. §25C, worth up to $2,000 for a qualifying heat pump, expired for property placed in service after 2025-12-31.
At this electricity price a seasonal COP of 4.22 is needed just to match your current running cost. This system is modelled at 3.00, so it will cost more to run than what you have now.
Electricity priced at the Massachusetts average of $0.2882/kWh.
Fuel and electricity prices both escalate at 3% a year.
Comfort, air quality and carbon are excluded — this is running cost only.

The number that decides it: break-even COP

Forget projected savings for a moment. Work out the seasonal COP your heat pump must hit just to match what you already pay:

break-even COP = electricity price ÷ current cost per kWh of delivered heat

Heating with 80% efficient natural gas at $1.60/therm costs about $0.068 per kWh of heat. At $0.18/kWh electricity, the break-even COP is about 2.6 — so a heat pump averaging 3.0 across the season saves money, and one averaging 2.2 does not. At $0.30/kWh electricity the break-even climbs past 4.3, which very few systems reach over a real winter.

Full cost or incremental cost?

This choice moves the answer more than almost anything else, and most calculators quietly pick the flattering one.

Your system is dying anyway. You are buying heating equipment regardless, so only the difference in price belongs to the heat pump decision. That difference is often $3,000–8,000 rather than the full $15,000.
Your system has years left. Then the full installed cost is real, and the payback is correspondingly longer.

The calculator above lets you say which case you are in.

Where heat pumps win easily

Replacing electric resistance heat. A COP of 3 cuts the electricity used for heating by roughly two thirds. This is close to a guaranteed win, whatever your rate.
Replacing oil or propane, which are usually dearer per unit of delivered heat than natural gas.
When you also need air conditioning. One machine doing both jobs changes the comparison, since the alternative was two purchases.

Where they struggle

Cheap natural gas plus expensive electricity. Parts of the Northeast pay above $0.29/kWh, which pushes the break-even COP beyond what cold-climate equipment sustains through a real winter.
Very cold climates without a cold-climate unit. Backup resistance heat runs at a COP of 1 and drags the seasonal average down hard.
Poorly insulated homes. Larger equipment, more backup heat, worse seasonal COP.

What this leaves out

Comfort, air quality, carbon emissions and the value of getting a combustion appliance out of the house are all real and none of them are priced here. This calculator answers one question — running cost — and answers it honestly. Several of the excluded factors point toward a heat pump, so a household that values them may reasonably accept a worse financial result.

Common questions

Is there still a federal heat pump tax credit in 2026?

No. §25C, the Energy Efficient Home Improvement Credit worth up to $2,000 for a qualifying heat pump, expired for property placed in service after December 31, 2025. State and utility rebates may still apply.

What is a break-even COP?

The seasonal efficiency a heat pump must reach for its electricity to cost the same as your current fuel. It falls straight out of your electricity price divided by your cost per unit of delivered heat. If your heat pump cannot beat that number in your climate, it costs more to run — regardless of what the brochure claims.

Should I count the whole cost of the heat pump?

Only if your current system still has years of life left. If the furnace is dying and you are replacing it either way, the honest figure is the difference between the heat pump and the like-for-like replacement. Charging the full price to the heat pump makes a sound decision look terrible.

Why is my seasonal COP lower than the rating on the box?

Nameplate COP is measured at mild temperatures, usually 47°F. Efficiency falls as it gets colder, and many systems fall back on resistance heat in a cold snap, which runs at a COP of 1. Seasonal COP averages all of that over a real winter, which is why it is the number that matters.