Choosing whether to install a gas, oil, or electric furnace often comes down to the price of a particular fuel in a certain part of the country at the time of installation.
- Gas-Fired: Gas furnaces typically run on propane or natural gas. They are extremely efficient and relatively cheap to install. Gas and propane prices do fluctuate greatly, however.
- Oil-Burning: Oil furnaces are popular due to their low installation and upkeep costs, but they’re dependent on a nonrenewable form of energy. As a result, fuel prices are extremely variable.
- Electric: Electric furnaces are the most efficient and the least expensive option. Operating costs tend to be high, however, so find out the kilowatt/hour cost from the local electric company to determine if this option makes sense for you.
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Additional Furnace Considerations
A major factor in furnace performance is fan speed. Most manufacturers offer the following fan options:
- Single-Stage: These furnaces have two speeds: on and off. When the thermostat calls for heat, the furnace kicks on and works at 100% capacity. This is the least efficient type of furnace.
- Two-Stage: This type of furnace starts operating at 60% capacity and increases as necessary. The longer it operates, the closer to 100% capacity it gets. Two-stage furnaces are very efficient and also quieter than single-stage furnaces.
- Three-Stage: A three-stage furnace operates similarly to a two-stage furnace but is more efficient and much quieter.
Installing more than one furnace is always an option. Many homeowners decide to install an electrical furnace as a backup for an oil or gas-fired furnace (or vice-versa). A large home may also need an additional furnace to heat its extensive living space or to provide heat to a detached living space.
Please note that for the prices ranges below, single-stage furnaces tend to be towards the bottom of the range, while three-stage systems are at the higher end.
- Typical gas furnaces cost $3,000 to $6,000, including installation, but can rise as high as $12,500 for extremely efficient models.
- Oil-burning furnace costs, including installation, range from $3,000 to $7,000.
- Electric furnaces typically cost $1,000 to $3,000 with installation. Keep in mind that these low costs will be somewhat offset by higher energy bills. These units are best used as backups or for very small living areas.
- The above prices assume there is already a duct system installed in the house; if there is no existing ductwork or new ductwork is needed, expect to add $3,000 to $7,000 to the total project cost.