natural gas vs propane furnace

The cost is usually the first thing that comes to mind when homeowners think about their home heating alternatives. The choice between natural gas and propane is a big one that affects both the environment and how much you pay in the long run. In this article, we’re doing a comparison of both of these furnace types and talking about which one is more expensive and why.

Factors Affecting Running Costs for Natural Gas and Propane Furnaces

1. Fuel Prices

Natural Gas: Natural gas is a more economical heating fuel alternative to propane in regions where it is easily accessible through municipal lines because its price per BTU is usually lower. But, fuel supply and demand, particularly during cold spells, as well as changes in regulatory laws, can cause natural gas prices to fluctuate.

Propane: Propane gas is typically more costly than natural gas per British thermal unit. Propane costs can still be higher, especially in areas where propane has to be supplied and stored in a storage tank, which adds logistical difficulties, even though it delivers higher efficiency owing to its increased BTU production per unit.

2. Energy Efficiency Ratings (AFUE)

Natural Gas Furnaces: For natural gas furnaces, the current AFUE ratings range from 89% to 98%. Fuel savings from higher efficiency ratings more than make up for the expense of fuel.

Propane Furnaces: With AFUE ratings of up to 98%, propane furnaces are just as efficient as natural gas furnaces. In terms of total heat production, even very efficient propane furnaces can frequently surpass because of the higher energy content per gallon.

3. Home Insulation

By lowering the quantity of heat required and, by extension, the fuel consumed, effective insulation has a comparable effect on both kinds of furnaces. By reducing the amount of fuel needed to maintain a constant temperature, homes with good insulation can make natural gas and propane systems work more efficiently.

4. Furnace Size and Home Layout

Natural Gas Furnaces: For natural gas furnaces, sizing is key; inefficiency and higher expenses might result from a furnace that is either too big or too small. To ensure the furnace capacity is an exact fit for the requirement, proper system design must take the entire home’s layout and volume into account.

Propane Furnaces: The proper size of propane furnaces is equally important as that of natural gas furnaces. On the other hand, if the furnace is too big and turns on and off too frequently due to the propane being stored on-site in a propane tank, sizing errors might result in more frequent refills and increased expenses.

5. Maintenance and Upkeep

For optimal functioning, both propane and natural gas furnaces need to be serviced regularly. When one is neglected, it might result in less efficient functioning and increased fuel expenses. Adding to the list of maintenance jobs, propane furnaces may necessitate extra inspections to ensure the safety of the tank and connections.

6. Local Climate

Natural Gas Furnaces: Generally speaking, natural gas processing furnaces work well in most climates, but they really shine in regions where the fuel is both inexpensive and plentiful. But the constant running of the furnace can be taxing in extremely cold temperatures.

Propane Furnaces: These units provide reliable performance even in extreme weather, and propane doesn’t gel at low temperatures, making them ideal for use in cold locations. Because of this, they work especially well in colder or more remote areas.

7. Ventilation and Ductwork

Both types of furnaces can have their efficiency reduced by inefficient ductwork. Regardless of the fuel type, it is necessary to remove duct leaks or open cracks to prevent uneven heating, increased operational expenses, and considerable energy losses.

8. Thermostat Settings

Either type of furnace can benefit from the optimal thermostat settings. A programmable thermostat is a useful tool for managing the operating expenses of propane and natural gas heating systems because it allows users to save heating costs by altering temperatures according to daily and nighttime needs.

Comparing Running Costs: Propane vs natural gas furnace

The upfront costs of installing a natural gas or propane furnace, as well as the cost of purchasing the device, are substantial. Depending on the model's efficiency and features, the average installation cost for either type of furnace might vary from $3,000 to $5,500. On the other hand, every fuel type has its own unique considerations:

Natural Gas:

During installation, a natural gas line is extended to the furnace. An easy and often inexpensive connection may be required in densely populated areas with existing compressed natural gas connections. On the other hand, the expense can skyrocket—possibly by thousands of dollars—if a new gas line needs to be laid, and that number depends on how far away from the main line it is and how complicated the job is to install the natural gas appliances.


Liquefied petroleum gas storage tanks, which can be rented or bought, need to be installed for this purpose. The monthly rental fees are eliminated when you buy the tank, which adds to the upfront cost (about $500 to $2,500 depending on the size). There may be extra labor and materials needed for installation if the fossil fuel tank and furnace connections need to be set up.

Fuel prices and system efficiency, as assessed by the AFUE rating, are major factors in furnace operating expenses.

Fuel Prices:

Liquefied natural gas, according to recent data, costs around $1.73 CAD per gigajoule, and propane, around $1.23 CAD per liter, plus an average delivery fee of $10 to $12. Natural gas is usually more cost-effective when expressed as BTU per dollar, even after accounting for its energy content. Propane may be more expensive per gallon, but it can make up for it in efficiency—using less fuel to provide the same amount of heat—thanks to its greater BTU per cubic foot.


Both forms of fuel can be used by modern, high-efficiency furnaces, which can reach AFUE values of over 90%. With a higher efficiency rating, more of the fuel is turned into useful heat, which means less fuel is used and costs less in the long run. You can reduce the impact of the higher fuel expenses by opting for a propane furnace, which often has somewhat better efficiency ratings than its natural gas counterparts.

Not only should yearly running costs be factored in, but also long-term expenditures like repair, maintenance, and replacement:


Depending on the model, yearly inspections and maintenance for both furnace types might cost anywhere from $100 to $200. The requirement to inspect and maintain the tank and its connections can lead to slightly greater maintenance costs for propane units.

Durability and Lifespan:

Both types of furnaces usually have a lifespan of 15–20 years, with the exact number depending on how well they are maintained. Nevertheless, unexpected expenses may accumulate over the system's lifetime due to the necessity to fix gas lines or replace propane tanks.

Resale Value and Popularity:

Homebuyers in urban and suburban locations may be more interested in purchasing a property with a natural gas furnace installed because of the perceived ease and reduced operating expenses.

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A person’s preference for environmental impact, the cost of installation and ongoing maintenance, and the availability of natural gas should be the primary considerations when deciding to go for a propane or natural gas furnace. Natural gas may be the more practical and economical choice for people living in places with existing natural gas pipelines or natural gas tanks, but propane provides a dependable and efficient heating option for people in more remote regions.

When making a decision, homeowners should think about the long-term effects as well as the short-term effects, such as whether they will save money with more efficient models or qualify for government subsidies for units with higher efficiency ratings. If you want advice that’s unique to your home and area, it’s a good idea to consult with an HVAC expert, such as those at Comfort Union.

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