Heat Pump vs Gas Furnace: The Pros and Cons for Your California Home

We have all heard the misconception that California is nothing but blue skies, sunshine and perfect temperatures. And while there are places like that where daily sun is the norm, the reality for the rest of us is a little different. Our climate is much more complicated than that.

So you may be wondering whether our region is right for heat pumps. It is a good question but to answer it, you have to first understand the pros and cons of a heat pump vs a gas furnace for California homes. In addition to government incentives, installing a heat pump instead of a furnace or central air conditioner can help you save money on your utility bills. The total amount of money you will save by purchasing a heat pump will vary depending on the cost of natural gas in your area, number of windows in your home, climate, season, and type of insulation behind your walls.

Read on to see why you should install a heat pump in your California home.


The Basics

Take a look at what exactly sets heat pumps and furnaces apart from each other, which is something that all homeowners should know, especially those who live in parts of California where we do not get the stereotypical year-round sunshine our state is famous for.


Heat Pumps

Think of a heat pump as an air conditioner in reverse.

If you turned your window air conditioner around, the warm air that usually dissipates outdoors would blow into your house — and you’d have a heat pump. Many heat pumps come with a reversing valve that lets them serves as heaters and air conditioners.

A heat pump employs the same type of cooling system as your refrigerator — a pair of copper coils separated by a tiny aperture, a refrigerant and a compressor. The compressor pressurizes the refrigerant in the condenser coils and turns it into a liquid, releasing heat.

The pressurized liquid sprays through the aperture and vaporizes in the evaporator coils, drawing heat out of the air. Then it cycles back to be re-pressurized. While an air conditioner fan circulates cool air from the evaporator coils into the house, a heat pump fan circulates warm air from those coils.

Heat pumps come in two parts. An outdoor unit houses the compressor, a set of evaporative coils and a fan. An indoor unit houses more condensing coils and another fan, usually in a separate structure called an air handler. A hose running through the wall connects the coils in the indoor and outdoor units.


Types of Heat Pumps

There are also different types of heat pumps. Each one is best for specific types of homes, depending on their climates and how they are built.

  • Ductless heat pumps, also known as ductless mini-split units, are ideal for older homes or homes that do not have existing ductwork throughout the home, as the pump does not require them to flow heat throughout.
  • Duct heated pumps, also known as air source heat pumps, these do need ducts throughout the home to work.
  • Geothermal heat pumps use the heat from the ground or water near your home to operate. This is optimal for those who live in climates prone to extreme weather.



Unlike a heat pump, a furnace generates heat by burning a fuel or passing electricity through a resistive element. It’s usually in the basement or a utility room, producing heat circulated through a ductwork system by a blower housed in the air handler.

All furnaces include a heat source, heat exchanger and a blower. Some fuel-burning ones have flues to exhaust combustion gases.

High-efficiency gas furnaces don’t need flues. They recycle combustion gases to extract more heat, and emit only acidified water through a PVC drain pipe. Though they turn nearly 100 percent of their fuel into heat, it’s still fossil fuel, another reason why California plans to ban them.


The Pros and Cons of Each for Your California Home


Heat Pumps

A heat pump is an HVAC system that transfers heat from one place to another. In the winter, it extracts heat from the outside air or ground and moves it inside to heat your home. In the summer, it works in reverse, removing heat from your home and moving it outside to cool your home.


Energy Efficiency

Air source heat pumps have higher efficiencies than other heating and cooling technologies; this means that you typically use less fuel to heat or cool your home with ASHPs than you would with more conventional technologies. Over time, consuming less energy can help you reduce both your environmental impact and energy bills.

Many heating and cooling technologies run on fossil fuel or electricity produced from burning fossil fuels, which releases greenhouse gasses into the atmosphere. When you reduce your property’s fuel consumption, you’re helping to decrease carbon dioxide emissions into the atmosphere and reduce your carbon footprint.

Consistent Temperature Control

One of the biggest advantages of a heat pump is that it provides consistent temperature control. Heat pumps maintain a consistent temperature throughout every room, making your home more comfortable and eliminating the need to constantly adjust the thermostat.

Eco-Friendly Solution

Heat pumps produce much less greenhouse gas emissions than traditional heating and cooling systems. An air source heat pump could take the place of a boiler or furnace, but it works differently. It doesn’t burn fuel to create heat, but instead moves it from one place to another. Heat from the air gets absorbed into a fluid, which causes it to become a gas. The gas is then compressed, raising its temperature. The higher temperature is then transferred into the heating system.


Less Effective in Extreme Temperatures

Heat pumps are less effective in extreme temperatures. In very cold temperatures, the heat pump will have to work harder to extract heat from the outside air or ground, reducing its efficiency.

Higher Initial Cost

The upfront costs of both heat pumps and furnaces depend on a number of factors specific to your individual home. Things like ductwork, the layout and insulation of your home, the local climate, the make and model of the heating equipment, and available rebate and incentive programs all influence the total cost of installing a new heating system. Also, a heat pump model that qualifies for federal or local rebates may be more affordable than a furnace that does not.

With so many contributing factors, an apples-to-apples cost comparison is difficult. Ductless mini splits tend to be more affordable than furnaces, while ducted air source heat pump systems can be more expensive to install (although, they may end up costing less than a furnace and air conditioner combined). The bottom line is that your cost can vary widely depending on your home’s size and existing system including ductwork, gas lines, and electrical lines.


Gas Furnace

A furnace is a heating system that heats the air and distributes it throughout your home using ductwork.


Effective in Extreme Temperatures

Furnaces are effective in extreme temperatures. They can quickly heat up your home even in the coldest weather conditions.

Lower Initial Cost

Furnaces are less expensive to install than heat pumps. They also have a longer lifespan than heat pumps.


Less Energy Efficient

Furnaces are less energy-efficient than heat pumps. They use natural gas, oil, or propane to create heat, which releases carbon dioxide and other harmful gases into the environment.

Inconsistent Temperature Control

Furnaces can create hot and cold spots throughout your home, making it difficult to maintain a consistent temperature.


How Energy Efficient Are They?

Heat pumps are one of the most efficient heating systems available and use significantly less energy than furnaces because, unlike furnaces, they don’t actually generate heat. Instead, they transfer heat from one place to another. This is especially advantageous when you compare them to electric furnaces. According to the Department of Energy, air source heat pumps can reduce electricity use for heating by 50 percent. Not only does this process require less energy, but it also avoids the use of fossil fuels – so, all things being equal, heat pumps are more energy efficient than furnaces.

However, the performance of a heat pump system is also dependent on a number of factors, like proper installation and local climate. The colder it gets, the harder heat pumps have to work. However, due to impressive advancements in heat pump technology, cold climate-certified heat pumps are able to maintain efficiency and keep your home warm in temperatures well below zero. Even still, there are some instances when furnaces become the more efficient option in extremely cold climates.


How You Can Save Money

From making home weatherization and efficiency upgrades, to installing new electric appliances, to purchasing an electric vehicle or rooftop solar system – learn how the Inflation Reduction Act will help cover the costs and save you money each month on your bills.


Tax Credits and Rebates for Families

When homes need to replace their heating or cooling systems, families can get tax credits for efficient heat pumps that ensure comfortable home temperatures. By doing the job of both a furnace and air conditioner, heat pumps work to keep homes warm in the winter and cool in the summer.

Right now, households can receive a $300 tax credit for purchasing a heat pump.  The total of current and previous years credits, including those for energy efficiency improvements, high efficiency furnace and air conditioners cannot exceed $500.

Starting next year, households will be able to claim a tax credit for 30% of the costs of buying and installing a heat pump, up to $2,000 including support for any electric system upgrades needed to make the home heat-pump-ready.

Beginning in 2023 state programs will offer low- and moderate-income households rebates for heat pumps at the point-of-sale, cutting costs of purchase and installation up to $8,000. If home electrical upgrades are needed to integrate new heat pumps, rebates of up to $4,000 will also be available to households.


Heat Pump Provisions in the Inflation Reduction Act

If you opt to install a heat pump, you’ll be eligible for a federal tax credit for models that achieve the Consortium for Energy Efficiency’s (CEE) highest tier for efficiency.

This tax credit is good for 30 percent of the total cost of what you paid for your heat pump, including the cost of labor, up to $2,000; and it would be available through the end of 2032.

Beyond the tax incentive, you also could be eligible for up to $1,750 for a heat pump water heater and $8,000 for a heat pump for space heating and cooling. Both incentives would be in the form of a state-administered rebate on any heat pump model. In this case, there are no federal efficiency requirement guidelines beyond the minimum standards required by the Department of Energy. But based on how similar programs have operated in the past, states may implement their own requirements, says Lauren Urbanek, a senior energy policy advocate at the Natural Resources Defense Council. These rebate incentives are part of a program with $4.5 billion in federal funding, available through September 2031.



Give Us a Call

At Aire-Tech, we can help keep your home at the optimal temperature! We give you countless resources to help you explore and learn about HVAC options, including incentive programs. We work closely with agencies to pass on savings programs and information to our valued customers.

If your system needs repair or inspection, call Aire-Tech on 951-926-1002. You can also visit our Contact page and complete the contact form.