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Average High-Efficiency Gas Furnace Cost
The average cost of a high-efficiency gas furnace is primarily based on its exact efficiency but also on the brand, model, number of heating stages, blower speed, and extra features.
The average gas furnace prices are between $2,000 and $6,000 for most high-efficiency models, with a greater than 96% efficiency.
Compared to a mid-efficiency furnace, most homeowners pay on average between $1,000 to $3,000 for an 85 to 95% efficiency unit.
For installation, the average costs range from $3,500 to $6,500 and vary depending on region and season. Additionally, the installation pricing could increase if you have an old furnace that needs to be removed or if your home does not have a natural gas line run to the installation site.
The installation location is a factor as well; for example, installing a furnace in a crawl space may take longer than in a basement, leading to a higher labor cost for the extra time.
When Does it Make Sense to Buy a High-Efficiency Furnace?
If you’ve decided to get a new natural gas furnace, you might have trouble selecting the exact model for your home. While there are many different options to choose from, there are a few things to consider that will help you choose the right option for your home’s needs.
Size of Your Home
Your home’s size is the most critical factor when it comes to the selection of the efficiency of your next furnace. As you might have guessed, the larger your home is, the larger sized furnace you will need. And since you’ll be heating a larger area than a smaller house, your heating bill will be more expensive too.
While choosing a higher-efficiency furnace is more expensive up front, it will save you plenty of money in the long run, especially if you have a larger home.
Let’s do a payback analysis on this higher-cost option. First, we look at the difference in cost between a mid-efficiency and high-efficiency furnace compared to the money a high-efficiency furnace saves you each year.
For this example, let’s say a high-efficiency furnace of 98% costs you $2,000, and a mid-efficiency unit with 85% cost $1,400, a difference of $600.
Let’s estimate the yearly heating bills as $1,000 with the 85% unit and $870 for the 98% furnace in a large home.
Therefore, each year you would save $130 in your heating cost if you choose the 98% high-efficiency model instead of the 85% mid-efficiency furnace.
Now recall, their upfront price difference was $600. This means it would take about 4.6 years to “break even,” with the high-efficiency furnace ($600 divided by $130 per year).
Therefore, in a large home, the payback period is under five years. Doing the same analysis for a small house with a yearly heating cost of $350 yields an 11.4 year payback period.
On the other hand, if you have a well-insulated smaller home (1,200 sq ft or less), paying the extra money and upgrading to a high-efficiency furnace isn’t typically worth it.
However, homeowners that have a large house with a sizable yearly heating bill (greater than $500/year) should definitely consider going with a high-efficiency furnace.
The climate you live in also dictates whether a high-efficiency furnace is right for your home. For example, if you live in a relatively warm climate, your yearly heating bill will be very low. In this case, you would have a very low payback period similar to that of a small, well-insulated home in the previous section.
Therefore, in warm climates, it doesn’t really make sense to get a high-efficiency furnace. In fact, it only makes sense to get a high-efficiency furnace in climates with cold winters.
Another factor to consider when deciding if a high-efficiency furnace makes sense for you is the performance of said furnace.
Furnace performance relates to how quickly the furnace heats your home, how well it maintains the temperature, and how evenly it heats your home.
Low and mid-efficiency furnaces heat your home slowly. They can often go up to 5°F below the setpoint on your thermostat, and might leave your home with “hot spots” or “cold spots.”
On the other hand, a high-efficiency furnace alleviates all of these potential frustrations through its high-tech, efficient design. For mild climates, the performance of a high-efficiency furnace is often hard to tell apart from a mid-efficiency unit. However, in areas with frequent sub-zero temperatures, the high-efficiency furnace is a noticeable all-star.
Like most homeowners, you might not know that there are different types of venting for your furnace. The type of venting is not exclusive to high-efficiency furnaces. In other words, any kind of natural gas furnace can be installed in either a vented space or an enclosed space.
However, if you want to change the location of where your new high-efficiency furnace will be installed in your home, this is an important consideration.
With any type of furnace, there is a tiny chance of carbon monoxide leaking, and depending on the type of venting you have, it could reduce the risk of carbon monoxide (CO) poisoning.
Enclosed spaces includes places like your basement, a utility closet, or a crawlspace. If a furnace were to leak carbon monoxide, it would build up inside that space and could reach dangerous concentration levels.
On the other hand, vented spaces (like an attic) have air vents that release inside air to the outdoors. This means that air is constantly exchanged and reduces the likelihood of carbon monoxide building up to dangerous levels.
High-efficiency furnaces can be installed with concentric vents which exhaust combustion gases through one opening and pull in outside air through another opening.
Most mid-efficiency furnaces cannot be installed with concentric vents because they do not have secondary heat exchangers, so they can only use a regular flue instead. Secondary heat exchangers in high-efficiency furnaces reduce the exhaust temperature enough for this type of configuration (otherwise, the exhaust is way too hot).
Therefore, a high-efficiency furnace with a concentric vent may be safer than a mid-efficiency furnace without one, even though carbon monoxide leaks are extremely rare occurrences.
The installation of a high-efficiency furnace differs from low and mid-efficiency units. The high-efficiency uses sealed combustion, unlike other units which pull in surrounding air for their combustion process.
Therefore, a high-efficiency unit requires installing a combustion air intake pipe that supplies air straight into its combustion chamber.
If the high-efficiency furnaces need to be installed in a vented space in your home, the air intake pipe will be an extra installation cost. So, if you didn’t already have a high-efficiency furnace, you will be paying even more for the installation.
Any furnace that is well maintained can last longer than 20 years, whether it’s high-efficiency or not. However, since high-efficiency furnaces experience less “wear-and-tear” than a low-efficiency furnace that always runs at 100%, you can expect longer than average lifespans.
The indoor climate comfort that a furnace provides might be a supporting reason to choose a high-efficiency unit. A high-efficiency furnace will run for more extended periods of time at a lower heating output because it’s more energy-efficient to run this way.
Because it runs longer, the high-efficiency furnace provides more even heating throughout the home. This means there are fewer cold spots and hot spots, plus there are fewer “temperature swings.” High-efficiency furnaces work and feel better in cold climates.
Single-Stage vs. Two-Stage vs. Modulating Furnace Costs
The number of heating stages is a critical factor to consider when it comes to choosing a high-efficiency furnace. More often than not, a high-efficiency unit will have either two stages, or it will be a modulating furnace. The number of stages refers to how many levels of heating output the furnace has, for example:
- A single-stage furnace has one setting – the gas valve is either fully closed or fully open- 100% on
- A two-stage furnace has two gas valve settings – 70% and 100% open
- A modulating furnace can ramp up and down from 30 to 100% and toggle the gas valve in 1% increments
So, a single-stage furnace rated for 100,000 BTU (British Thermal Units) output will always produce 100,0000 BTUs.
On the other hand, a two-stage unit rated for the same output will run most of the time at 70,000 BTU (40% of 100,000). If cold weather rolls into town quickly, the two-stage furnace can then switch to 100% output and produce 100,000 BTUs. It is more energy-efficient to run lower for longer than to run full blast for short periods. This is why most high-efficiency furnaces have at least two-stage burner control.
Lastly, modulating furnaces have the most efficient control of all furnaces. If this is a modulating 100,000 BTU furnace, it will be able to control its burner anywhere from 30,000 to 100,000 BTU. This provides the best heating control and comfort (let alone efficiency).
Due to their different performance levels and more sophisticated burners, modulating furnaces cost more than two-stage and single-stage furnaces (we’ll get to the costs soon).
How Does AFUE Relate to Heating Stages?
The Annual Fuel Utilization Efficiency (AFUE) is a ratio of the fuel the furnace uses to create heat to the amount of usable heat it provides into the home over the course of a year. AFUE is measured in percentage. If you see a furnace with a 95% efficiency rating, that is short for 95% AFUE.
Higher AFUE ratings are better, and the minimum AFUE for furnaces in the U.S. is 80%, as mandated by the Department of Energy (DOE). The AFUE information is always found on the Energy Guide tag by the Energy Star program on the furnace.
Single-stage, two-stage, and modulating can all achieve various AFUE ratings. However, as the number of heating stages increases, higher efficiencies are achievable. Here is how their average AFUE ratings compare:
- Single-stage furnaces – AFUE from 80% up to 96%
- Two-stage furnaces – AFUE from 80% up to 97%
- Modulating furnaces – AFUE from 97% to 98.5%
Next, let’s dive into the costs of gas furnaces with these different heating stages.
Single-Stage Furnace Costs
Single-stage furnaces are sometimes referred to as one-stage furnaces, and are the least efficient of the three. Still, through other technological improvements, single-stage units can achieve efficiencies great enough to be considered “high-efficiency.”
The average cost for a single-stage 96% efficient furnace is between $950 to $1,800.
Two-Stage Furnace Costs
Dual-stage furnaces are capable of slightly higher AFUE ratings than single-stage units. They are often paired with multi-speed blowers to achieve higher efficiencies. The average cost of a two-stage furnace of 96% AFUE ranges from $1,200 to $1,700.
Modulating Furnace Costs
Modulating furnaces provide the finest controls and highest efficiencies. They either have multi-speed or variable-speed blowers and cost between $1,500 and $2,400 on average.
For all types of furnaces, the cost will vary depending on capacity (BTUs), brand, model, type of blower, and the airflow direction (horizontal, upflow, downflow). However, buyers should always know that high-efficiency units always cost more than lower-efficiency units if all else is equal.
Natural Gas vs. Other Types of Heating Systems
We’ve talked about single-stage, two-stage, and modulating natural gas furnaces, but what about propane furnaces, oil furnaces, electric furnaces, and heat pumps? Do they have different stages too?
Fortunately, propane furnaces are available in different heating stage configurations and high-efficiency versions too. In fact, most natural gas furnaces can be converted to propane with simple conversion kits.
For example, if you have a modulating natural gas furnace with a 97% AFUE, it can be converted to run on propane as the heating source.
Oil furnaces are designed a bit differently than gas and propane furnaces. They don’t have “heating stages,” but they do provide a similar function with low, medium, and high heat settings.
Electric furnaces are entirely different and cannot be converted to a gas-burning unit. They run solely on electricity and heat coils with electrical current to produce heat. Since an electric furnace does not have a gas valve, it does not have heating stages either.
A heat pump is another common HVAC system too. However, a heat pump is not technically a “furnace.” In fact, it is more like an air conditioning system – it uses the vapor compression refrigeration system to remove or provide heat to your home. Yes, you read that right; heat pumps can heat and cool.
Heat pumps don’t have heat stages like gas furnaces (since they don’t have a gas valve), but they do offer precise control of your home’s heating and air conditioning.
Repair Cost Considerations
Even if you have proper, routine maintenance performed on your furnace, there is still a tiny chance it will require a repair of some sort within the first seven years after installation.
Since high-efficiency furnaces use more complex component parts, the repair cost of a high-efficiency unit would likely be higher than a mid-efficiency unit.
However, a high-efficiency furnace with a good warranty could negate some of the repair costs.
New Furnace Buying Tips
When you’re in the market for a new, high-efficiency furnace, there are many things you should consider. These are the top considerations for a furnace, but don’t let this list overwhelm you. This is not a checklist, where you need each one absolutely perfect.
Never Pick the Lowest Bid
You’ve probably heard the adage from your elders- “never pick the cheapest bid; you’ll pay more later.” There’s plenty of wisdom in this saying, and it definitely applies to furnace installation too.
HVAC contractors with the lowest bid often cut corners, leading to issues down the road or immediately. Always pick a “reasonable bid” for your new high-efficiency furnace installation.
Use Professional Installation
A certified HVAC technician should install all types of furnaces. To make sure your furnace is installed correctly and safely- hire a pro, don’t DIY it. We’ll explain more on why later.
Compare High vs. Very High-Efficiency
The cost of a very high-efficiency furnace might be $500 to $1,000 more than a high-efficiency furnace. We did a cost-benefit and break-even analysis earlier in this guide, where we compared an 85% and 98% AFUE furnace.
The same analysis can be done comparing a 95% and 98% furnace. In other words, does the extra 3% in energy cost savings really save you that much more money on energy bills?
Buy a Reputable Brand
If you’re in the market for a high-efficiency furnace, you’ll want to make sure you’re getting a great brand. Here are some examples of reputable furnace brands:
- American Standard
All of these manufacturers have an excellent track record of quality, performance and offer great warranties.
Find a Good Warranty
Many of the reputable furnace manufacturers have fantastic warranties. However, there are plenty of differences between each. You’ll have to weigh the warranty terms alongside other factors like cost when making your brand and model decision.
Whatever brand you get, remember to register it within 60 days; otherwise, some brands have reduced warranties outside their registration period.
Some top things you should look out for are manufacturer and energy rebates as well as tax credits.
Rebates are rare, but sometimes manufacturers provide rebates if you buy their equipment. Additionally, your local utility company may provide a rebate for upgrading to a high-efficiency unit.
Tax credits are usually provided by your state or county government.
Heating Stages and Blower Speeds
The number of heating stages and the blower speed affects the price you pay. These options also affect the comfort of your home during the cooling season. Take all of this into consideration in your final decision.
Heating Capacity BTUs
The heating capacity of a furnace is the amount of heat (measured in BTUs) it can provide to your home. If its capacity is too low, it won’t be able to heat your house adequately. Our HVAC professionals can help you properly size your furnace- give us a call now at Blue NAtional HVAC for assistance.
Any Heating System Should Be Professionally Installed
Whether it’s a high-efficiency unit or not, the installation of a furnace is a complex endeavor. It’s so complicated that furnace manufacturers don’t trust average homeowners to install it themselves. They void their warranty terms if their furnace is installed by anyone other than a certified HVAC contractor. Therefore, you shouldn’t take on the installation of a new furnace as a “DIY project.
Let our experienced furnace installers handle the job for you. Our HVAC pros can help with all your furnace replacement questions, review furnace installation cost, and ultimately provide the best furnace for your home. So, give our HVAC technicians a call today to get started!