Do High-Efficiency Gas Furnaces Save You Money?

It’s true: household energy prices will probably increase this winter. The Energy Information Administration (EIA), part of the U.S. Department of Energy, predicts that rising energy costs and a colder winter will force Americans to pay more for their heat in the final months of 2022 and into 2023.

So, would a high-efficiency gas furnace help you save money? The short answer is yes. With a high-efficiency furnace, you can likely save about 10 to 20% of your current energy bill.

Notice we said “likely.” This is because the precise amount you can save with a high-efficiency furnace depends on multiple factors.

So today, we’ll dive into this topic and help you understand what a high-efficiency furnace can do for you. 

Here’s what we’ll cover in this post:

What is a high-efficiency furnace?

How does a high-efficiency furnace save you money?

Why upgrade to a high-efficiency furnace?

Let’s get going!

What is a high-efficiency furnace?

To be called “high efficiency,” a furnace must be able to convert at least 90% of the fuel it consumes into usable heat for your home. In other words, it must have an Annual Fuel Utilization Efficiency (AFUE) rating of at least 90%.

This is in contrast to standard efficiency furnaces, which convert about 80% of the fuel they consume into heat.

The race among furnace manufacturers to make the most of natural gas – which has been the least expensive fuel for some time – has produced modern furnaces with efficiency levels of close to 100%. Lennox leads the pack here with a model that delivers an AFUE of 99%.

The key product feature that separates a high-efficiency furnace from a standard-efficiency furnace is a secondary heat exchanger.

Here’s how a secondary heat exchanger works: all furnaces produce exhaust during the heat-generation process. A standard-efficiency furnace simply vents this exhaust from your home. But a high-efficiency furnace uses its secondary heat exchanger to extract even more heat from the exhaust before venting it. Only then does a high-efficiency furnace vent this exhaust – what little remains, that is – from your home.  

How does a high-efficiency furnace save you money?

Figuring out the potential energy savings you get from a high-efficiency furnace is easy. We’re going to consider everything else constant for the moment and look only at the furnace’s AFUE rating.

Let’s say you spend one dollar on heating your home. If you have a standard-efficiency furnace with an AFUE of 80%, then 80 cents of your dollar delivers warmth, and 20 cents of your dollar is vented in the exhaust.

Now, if you have a high-efficiency furnace with an AFUE of 90%, then you get 90 cents of warmth, and you waste only 10 cents.

And obviously, if you have an advanced high-efficiency furnace with an AFUE of 99%, then nearly all your heating dollar produces actual, usable warmth. You waste very little.

So, if you replace your standard-efficiency furnace with a high-efficiency one, you can save anywhere from 10% to nearly 20% of your current heating bill.

Now let’s do some real math.

In Pittsburgh, an average gas bill is around $150 per month. So let’s go ahead and say that’s the amount of your monthly gas bill.

If you have a standard-efficiency furnace with an 80% AFUE, and you upgrade to the best high-efficiency furnace on the market with an AFUE of 99%, you can save $28.50 (19% of $150) per month while your furnace is in use.

Pittsburgh weather means that you run your furnace pretty consistently from November through March. And you probably use it off and on in October and April, too. Even September and May can have some cold snaps!

All in, we can say that Pittsburghers use their furnaces for five months, sometimes six, out of the year.

That amounts to a potential energy savings of $142 to $171 per year, thanks to a high-efficiency furnace.

And if that furnace lasts you 15 to 20 years – which it should, if you invest in a quality brand and take care of it with routine maintenance – then you’re looking at a possible total savings of $2,130 to $3,420 over the life of your furnace.

Given that the purchase price of high-efficiency furnaces starts at about $3,400, this is a significant saving. It’s the cost of a whole new furnace.

And now, let’s consider other factors that affect your energy usage.

When we began our discussion of how much money you can save with a high-efficiency furnace, we mentioned that we were holding everything else constant.

Well, now it’s time to consider those other things, which, in reality, aren’t constant. Here are some questions to ask yourself. The answers likely reduce your potential savings at least somewhat:

What is your gas bill in the summer?
Your furnace is not the only source of your gas bill. The gas that heats your water, powers your cooktop, and keeps other appliances running contributes to your bill, too. In fact, the easiest way to determine how much you’re spending in heat alone is to compare your gas bill in the summer to your gas bill in the winter. The amount of your summer bill remains part of your winter bill. And there’s no furnace that can reduce that summer portion.

Do you have a gas fireplace?
If you do and you enjoy using it, that will increase your gas bill in the winter, regardless of the type of furnace you have.

How warm do you like your home?
If you like to set your thermostat to a toasty 75 degrees, you’ll use a lot of fuel. So no matter how efficient your furnace is, it will run more often and drive up your energy bill.

How long do you plan to own your current home?
As we’ve seen, a high-efficiency furnace can help you save big on energy costs. But these energy savings accrue over a decade or two. If you move from your home before then, at least some of the savings will benefit the new owners rather than you.

Are you on a budget plan with the gas company?
If you’ve set up your utilities so that you receive a gas bill in the same amount each month, calculating your exact savings from a high-efficiency furnace is not possible.      

What is the structural integrity of your home?
When we’re advising homeowners about whether they should invest in a high-efficiency furnace, we often discover issues in their home that will prevent any furnace – high-efficiency or not – from running at its best:

  • Old, single-paned, or other substandard windows that leak air.
  • Insufficient insulation.
  • Uninsulated spaces like integral garages, attics, and crawl spaces.
  • Poorly sized ductwork for the size and configuration of the home or poor transitions in the ductwork that allow air to escape.

An experienced HVAC pro can address the ductwork, but the other issues should be addressed by a contractor. Otherwise, a high-efficiency furnace won’t be a worthwhile investment. Too much of the warmth it delivers will escape your home.

So why upgrade to a high-efficiency furnace?

Without question, a high-efficiency furnace saves you money over time. This is because it performs better than a standard-efficiency furnace at converting fuel to heat. So with a high-efficiency furnace, you get to use more of the fuel you’re paying for. This is true even if you can’t be sure of the exact amount you save and even if your savings go down in some years due to other factors.

There are several other reasons that a high-efficiency furnace may be right for you:

More comfort
A secondary heat exchanger is not the only technology that high-efficiency furnaces feature. They also have variable-speed motors for modulating heat and distributing it evenly throughout your home. They have sealed combustion chambers that burn outdoor air rather than indoor air, which is better for safety as well as efficiency. And bonus: all this efficiency makes these furnaces quieter as well.

Better for the environment
The more efficient a furnace is, the better it is for the environment. High-efficiency furnaces use more of the fuel they consume and waste much less. Because they vent so little exhaust, their emissions are vastly lower, and their resulting environmental impact is lower too.

The opportunity for cleaner air
Greater efficiency doesn’t magically clean your indoor air. But many furnace manufacturers design their high-efficiency models to work seamlessly with their indoor air quality products. For example, Lennox offers an Ultimate Comfort System that consists of a high-efficiency furnace plus an advanced air purification solution. Together, this system removes 90% of virus-sized particles and 99.9% of allergens like dust, pollen, and dander from your home.


If you’re considering upgrading to a high-efficiency furnace this winter, we’d be happy to walk you through all your options. Give us a call at 724-745-7404, or text us at 412-952-5923. You can also contact us via our website at any time. We look forward to serving you!


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