Heat Pumps: gas vs electric costs

[surfer349]

https://www.mrmoneymustache.com/2021/10/05/diy-heat-pump/

Following up on the post from last fall. One of the big factors was cost-savings. I live in Idaho and have read/told that gas is so cheap here that it doesn't make sense to switch to any electric appliances (HVAC, water heater, etc).

Does anyone have any insight or advice for calculating and comparing, factoring in the cost-factor of electric vs gas?

Note, I do NOT have any solar panels. I'm interested in it, but haven't jumped in yet.

[BudgetSlasher]

There are plenty of calculators floating around out of the internet, you will need specifics for gas/electric costs and combustion/HVAC efficiency ratings to get an accurate picture. If you are just looking a quick estimate you can pull some generic numbers, otherwise you will need the numbers for what you have and what you are planning on replacing it with.

I have used this calculator before (https://www.maine.gov/energy/sites/maine.gov.energy/files/inline-files/Home-Heating-Calculator.xls) though I am pretty sure it was hosted through Purdue at time and not the State of Maine.

Of the top of my head I do not have something for electric/heat pump water heaters that goes into that level of detail.

[Jon Bon]

It really depends on where you are. Generally 1 btu produced by gas is going to be cheaper than 1 btu produced by a heat pump. Especially the colder it gets.

If having snow is rare, a heat pump is a good option, if below zero is a regular occurrence a heat pump is going to be horribly expensive.

Source: Me, just installed a heat pump (in addition to a gas furnace) and I am not happy with its performance at all.

[chemistk]

A few things to consider:

-Heat pumps are still getting more efficient and effective at colder temperatures. Inverter-drive minisplits (although still very expensive) perform very well even down in the single digits and below zero.

-the IRA that is set to roll out includes some very juicy incentives for installing heat pumps vs. traditional heating systems. No doubt it will bring up the average cost for a new install a bit thanks to the free money floating around but it still will considerably help to offset the cost.

-Natural gas may be very cheap now but there's no guarantee that it will be in 5, 10, or 15 years. Between infrastructure improvements and uncertainty around future climate related legislation, there's a very real chance that natural gas will rise to be on par with electric.

All this to say - don't just assume that the current state will reflect the future state. If you need to replace a system ASAP, the calculus is probably going to tip toward natural gas. But if you know you're going to be in the same place for an extended period of time and you have the right set of factors that would lend to a heat pump, you might find yourself looking more towards future proofing your energy costs (especially if you will be installing solar).

[Paper Chaser]

-Natural gas may be very cheap now but there's no guarantee that it will be in 5, 10, or 15 years. Between infrastructure improvements and uncertainty around future climate related legislation, there's a very real chance that natural gas will rise to be on par with electric.

It's also entirely possible that because NG is tied to petroleum production, that it's price could fall with demand as we increasingly lean on electricity for our energy needs. Fewer NG appliances, fewer ICE vehicles, etc should all reduce demand/prices of NG while the opposite seems likely to happen with electricity prices as demand continues to increase and investments in renewables are made.

The only sure way to predict future energy prices is to be as independent as possible with your energy production.

[chemistk]

-Natural gas may be very cheap now but there's no guarantee that it will be in 5, 10, or 15 years. Between infrastructure improvements and uncertainty around future climate related legislation, there's a very real chance that natural gas will rise to be on par with electric.

It's also entirely possible that because NG is tied to petroleum production, that it's price could fall with demand as we increasingly lean on electricity for our energy needs. Fewer NG appliances, fewer ICE vehicles, etc should all reduce demand/prices of NG while the opposite seems likely to happen with electricity prices as demand continues to increase and investments in renewables are made.

The only sure way to predict future energy prices is to be as independent as possible with your energy production.

I mean, will it though? Oil companies have been avoiding domestic capex, especially ever since the oil inversion we saw back in 2020. I don't think we're going to get federal incentives for the consumer to keep natural gas, and progressive states are already mandating the reduction or elimination of NG in new builds where possible. I can see a scenario where NG remains absurdly cheap for a few years, and incentives for new residential installs will continue to hook people into NG only to see rates steadily rise to shore up the loss in profit from fuel production.

My utility offers a program where if you agree to (and demonstrate) install a new NG furnace, they'll completely waive/reimburse (depending on the situation) the meter installation and connection. Un-waived, a new meter is over $5k to install.

They know that as long as natural gas $/ccf is within the ballpark of electric, that people won't think about switching to a heat pump anytime soon lest they bear the cost of installing a heat pump.

We're going to be leaning on NG for quite some time for the electric grid, but there's no guarantee that the oil companies are going to be happy with NG being only marginally profitable. The infrastructure is still expensive to maintain, and despite 'assurances' today that they will be able to remain profitable I don't think that outlook is completely guaranteed.

[NorCal]

I just had a heat pump installed last month.  While it's really too early to tell, here's my anecdotal observations so far:

1. Not all heat pumps are created equal.  My new unit has a SEER of 23, and I believe my old AC had a SEER of 16.  That alone is something like a 40% efficiency improvement.  Some heat pumps are that efficient, but not all are.

2. If my installers annual usage estimates are correct, my winter electricity cost will be about what I'm paying for natural gas heating.  But this is based on the current high price of natural gas.  Although gas can still go up.

3. I have a home energy monitor, and I've been observing the heat-pumps behavior over the summer.  I can confirm that it is significantly more efficient in the summer than my old AC.  It's hard to say exactly, but I'm confident my summer usage will go down, and this will help with the bills even more as we transition to TOU pricing in the next year.

[Paper Chaser]

-Natural gas may be very cheap now but there's no guarantee that it will be in 5, 10, or 15 years. Between infrastructure improvements and uncertainty around future climate related legislation, there's a very real chance that natural gas will rise to be on par with electric.

It's also entirely possible that because NG is tied to petroleum production, that it's price could fall with demand as we increasingly lean on electricity for our energy needs. Fewer NG appliances, fewer ICE vehicles, etc should all reduce demand/prices of NG while the opposite seems likely to happen with electricity prices as demand continues to increase and investments in renewables are made.

The only sure way to predict future energy prices is to be as independent as possible with your energy production.

I mean, will it though? Oil companies have been avoiding domestic capex, especially ever since the oil inversion we saw back in 2020. I don't think we're going to get federal incentives for the consumer to keep natural gas, and progressive states are already mandating the reduction or elimination of NG in new builds where possible. I can see a scenario where NG remains absurdly cheap for a few years, and incentives for new residential installs will continue to hook people into NG only to see rates steadily rise to shore up the loss in profit from fuel production.

My utility offers a program where if you agree to (and demonstrate) install a new NG furnace, they'll completely waive/reimburse (depending on the situation) the meter installation and connection. Un-waived, a new meter is over $5k to install.

They know that as long as natural gas $/ccf is within the ballpark of electric, that people won't think about switching to a heat pump anytime soon lest they bear the cost of installing a heat pump.

We're going to be leaning on NG for quite some time for the electric grid, but there's no guarantee that the oil companies are going to be happy with NG being only marginally profitable. The infrastructure is still expensive to maintain, and despite 'assurances' today that they will be able to remain profitable I don't think that outlook is completely guaranteed.

I'm not necessarily arguing in support of NG here (although there isn't really a more financially viable alternative at the moment for many parts of North America). I'm just saying that I think it's quite likely that NG pricing can remain competitive with electricity pricing. Particularly because it seems likely to me that electrical rates increase moving forward (say over the next 10-15 years) rather than decrease. Trying to predict the price of either power source over a lengthy timeline seems perilous to me, unless of course you can control your own energy costs by being as independent as you can from the energy grids.

[chemistk]

-Natural gas may be very cheap now but there's no guarantee that it will be in 5, 10, or 15 years. Between infrastructure improvements and uncertainty around future climate related legislation, there's a very real chance that natural gas will rise to be on par with electric.

It's also entirely possible that because NG is tied to petroleum production, that it's price could fall with demand as we increasingly lean on electricity for our energy needs. Fewer NG appliances, fewer ICE vehicles, etc should all reduce demand/prices of NG while the opposite seems likely to happen with electricity prices as demand continues to increase and investments in renewables are made.

The only sure way to predict future energy prices is to be as independent as possible with your energy production.

I mean, will it though? Oil companies have been avoiding domestic capex, especially ever since the oil inversion we saw back in 2020. I don't think we're going to get federal incentives for the consumer to keep natural gas, and progressive states are already mandating the reduction or elimination of NG in new builds where possible. I can see a scenario where NG remains absurdly cheap for a few years, and incentives for new residential installs will continue to hook people into NG only to see rates steadily rise to shore up the loss in profit from fuel production.

My utility offers a program where if you agree to (and demonstrate) install a new NG furnace, they'll completely waive/reimburse (depending on the situation) the meter installation and connection. Un-waived, a new meter is over $5k to install.

They know that as long as natural gas $/ccf is within the ballpark of electric, that people won't think about switching to a heat pump anytime soon lest they bear the cost of installing a heat pump.

We're going to be leaning on NG for quite some time for the electric grid, but there's no guarantee that the oil companies are going to be happy with NG being only marginally profitable. The infrastructure is still expensive to maintain, and despite 'assurances' today that they will be able to remain profitable I don't think that outlook is completely guaranteed.

I'm not necessarily arguing in support of NG here (although there isn't really a more financially viable alternative at the moment for many parts of North America). I'm just saying that I think it's quite likely that NG pricing can remain competitive with electricity pricing. Particularly because it seems likely to me that electrical rates increase moving forward (say over the next 10-15 years) rather than decrease. Trying to predict the price of either power source over a lengthy timeline seems perilous to me, unless of course you can control your own energy costs by being as independent as you can from the energy grids.

I agree with you there - and that's why if OP is in the market right now it's a tough calculus. A NG furnace installed today will probably be cheaper to operate over its life, but one installed in 10 years might not necessarily be able to make that same claim.

The only reason I'd have any confidence in predicting the future of NG to be bleak is the mounting societal desire to see carbon consumption be priced accordingly, but then that's assuming that the world remains stable and predictable which I guess could make me foolish for doing so.

[NorCal]

-Natural gas may be very cheap now but there's no guarantee that it will be in 5, 10, or 15 years. Between infrastructure improvements and uncertainty around future climate related legislation, there's a very real chance that natural gas will rise to be on par with electric.

It's also entirely possible that because NG is tied to petroleum production, that it's price could fall with demand as we increasingly lean on electricity for our energy needs. Fewer NG appliances, fewer ICE vehicles, etc should all reduce demand/prices of NG while the opposite seems likely to happen with electricity prices as demand continues to increase and investments in renewables are made.

The only sure way to predict future energy prices is to be as independent as possible with your energy production.

I mean, will it though? Oil companies have been avoiding domestic capex, especially ever since the oil inversion we saw back in 2020. I don't think we're going to get federal incentives for the consumer to keep natural gas, and progressive states are already mandating the reduction or elimination of NG in new builds where possible. I can see a scenario where NG remains absurdly cheap for a few years, and incentives for new residential installs will continue to hook people into NG only to see rates steadily rise to shore up the loss in profit from fuel production.

My utility offers a program where if you agree to (and demonstrate) install a new NG furnace, they'll completely waive/reimburse (depending on the situation) the meter installation and connection. Un-waived, a new meter is over $5k to install.

They know that as long as natural gas $/ccf is within the ballpark of electric, that people won't think about switching to a heat pump anytime soon lest they bear the cost of installing a heat pump.

We're going to be leaning on NG for quite some time for the electric grid, but there's no guarantee that the oil companies are going to be happy with NG being only marginally profitable. The infrastructure is still expensive to maintain, and despite 'assurances' today that they will be able to remain profitable I don't think that outlook is completely guaranteed.

I'm not necessarily arguing in support of NG here (although there isn't really a more financially viable alternative at the moment for many parts of North America). I'm just saying that I think it's quite likely that NG pricing can remain competitive with electricity pricing. Particularly because it seems likely to me that electrical rates increase moving forward (say over the next 10-15 years) rather than decrease. Trying to predict the price of either power source over a lengthy timeline seems perilous to me, unless of course you can control your own energy costs by being as independent as you can from the energy grids.

I agree with you there - and that's why if OP is in the market right now it's a tough calculus. A NG furnace installed today will probably be cheaper to operate over its life, but one installed in 10 years might not necessarily be able to make that same claim.

The only reason I'd have any confidence in predicting the future of NG to be bleak is the mounting societal desire to see carbon consumption be priced accordingly, but then that's assuming that the world remains stable and predictable which I guess could make me foolish for doing so.

I think it's pretty clear that natural gas will eventually be impacted by what economists call "cost disease".  But I'd be surprised if it really starts to happen before 2030ish.

Essentially, natural gas has a ton of fixed costs along the entire value chain.  Big pipelines, safety inspections, property leases, debt, drilling costs etc.  All of these costs have to get paid even if the volume of gas sold starts to fall.  This will start driving up the price of gas significantly. 

Conversely, the competing technologies like heat pumps are only marginally more complex than a traditional AC.  The reason they cost so much more is that they are just  manufactured at a lower volume, and don't have the same manufacturing economies of scale.  The more demand for heat pump rises, the more the cost for them will fall.  The inflation reduction act is really going to accelerate this as well.

Eventually, the cost of natural gas will start rising faster than inflation, while the cost of competing technologies will start to fall.  While I don't know exactly when it will be, I expect it will start to accelerate when some of the big industrial users of natural gas (electricity, high-temp industrial processes, fertilizer, etc) start switching their fuel sources.  If I had to make a prediction, I'd guess this will be in the late 2020's or early 2030's. 

[big_owl]

-Natural gas may be very cheap now but there's no guarantee that it will be in 5, 10, or 15 years. Between infrastructure improvements and uncertainty around future climate related legislation, there's a very real chance that natural gas will rise to be on par with electric.

It's also entirely possible that because NG is tied to petroleum production, that it's price could fall with demand as we increasingly lean on electricity for our energy needs. Fewer NG appliances, fewer ICE vehicles, etc should all reduce demand/prices of NG while the opposite seems likely to happen with electricity prices as demand continues to increase and investments in renewables are made.

The only sure way to predict future energy prices is to be as independent as possible with your energy production.

I mean, will it though? Oil companies have been avoiding domestic capex, especially ever since the oil inversion we saw back in 2020. I don't think we're going to get federal incentives for the consumer to keep natural gas, and progressive states are already mandating the reduction or elimination of NG in new builds where possible. I can see a scenario where NG remains absurdly cheap for a few years, and incentives for new residential installs will continue to hook people into NG only to see rates steadily rise to shore up the loss in profit from fuel production.

My utility offers a program where if you agree to (and demonstrate) install a new NG furnace, they'll completely waive/reimburse (depending on the situation) the meter installation and connection. Un-waived, a new meter is over $5k to install.

They know that as long as natural gas $/ccf is within the ballpark of electric, that people won't think about switching to a heat pump anytime soon lest they bear the cost of installing a heat pump.

We're going to be leaning on NG for quite some time for the electric grid, but there's no guarantee that the oil companies are going to be happy with NG being only marginally profitable. The infrastructure is still expensive to maintain, and despite 'assurances' today that they will be able to remain profitable I don't think that outlook is completely guaranteed.

I'm not necessarily arguing in support of NG here (although there isn't really a more financially viable alternative at the moment for many parts of North America). I'm just saying that I think it's quite likely that NG pricing can remain competitive with electricity pricing. Particularly because it seems likely to me that electrical rates increase moving forward (say over the next 10-15 years) rather than decrease. Trying to predict the price of either power source over a lengthy timeline seems perilous to me, unless of course you can control your own energy costs by being as independent as you can from the energy grids.

I agree with you there - and that's why if OP is in the market right now it's a tough calculus. A NG furnace installed today will probably be cheaper to operate over its life, but one installed in 10 years might not necessarily be able to make that same claim.

The only reason I'd have any confidence in predicting the future of NG to be bleak is the mounting societal desire to see carbon consumption be priced accordingly, but then that's assuming that the world remains stable and predictable which I guess could make me foolish for doing so.

I think it's pretty clear that natural gas will eventually be impacted by what economists call "cost disease".  But I'd be surprised if it really starts to happen before 2030ish.

Essentially, natural gas has a ton of fixed costs along the entire value chain.  Big pipelines, safety inspections, property leases, debt, drilling costs etc.  All of these costs have to get paid even if the volume of gas sold starts to fall.  This will start driving up the price of gas significantly. 

Conversely, the competing technologies like heat pumps are only marginally more complex than a traditional AC.  The reason they cost so much more is that they are just  manufactured at a lower volume, and don't have the same manufacturing economies of scale.  The more demand for heat pump rises, the more the cost for them will fall.  The inflation reduction act is really going to accelerate this as well.

Eventually, the cost of natural gas will start rising faster than inflation, while the cost of competing technologies will start to fall.  While I don't know exactly when it will be, I expect it will start to accelerate when some of the big industrial users of natural gas (electricity, high-temp industrial processes, fertilizer, etc) start switching their fuel sources.  If I had to make a prediction, I'd guess this will be in the late 2020's or early 2030's.

Natural gas accounted for 40% of electric generation in the US last year so just switching to heat pumps doesn't totally insulate one from natural gas prices.   Hopefully renewables can continue to scale because natural gas is nearing $10/dek again, heating season is gonna suck for gas and electric this winter unless something changes. 

[NorCal]

-Natural gas may be very cheap now but there's no guarantee that it will be in 5, 10, or 15 years. Between infrastructure improvements and uncertainty around future climate related legislation, there's a very real chance that natural gas will rise to be on par with electric.

It's also entirely possible that because NG is tied to petroleum production, that it's price could fall with demand as we increasingly lean on electricity for our energy needs. Fewer NG appliances, fewer ICE vehicles, etc should all reduce demand/prices of NG while the opposite seems likely to happen with electricity prices as demand continues to increase and investments in renewables are made.

The only sure way to predict future energy prices is to be as independent as possible with your energy production.

I mean, will it though? Oil companies have been avoiding domestic capex, especially ever since the oil inversion we saw back in 2020. I don't think we're going to get federal incentives for the consumer to keep natural gas, and progressive states are already mandating the reduction or elimination of NG in new builds where possible. I can see a scenario where NG remains absurdly cheap for a few years, and incentives for new residential installs will continue to hook people into NG only to see rates steadily rise to shore up the loss in profit from fuel production.

My utility offers a program where if you agree to (and demonstrate) install a new NG furnace, they'll completely waive/reimburse (depending on the situation) the meter installation and connection. Un-waived, a new meter is over $5k to install.

They know that as long as natural gas $/ccf is within the ballpark of electric, that people won't think about switching to a heat pump anytime soon lest they bear the cost of installing a heat pump.

We're going to be leaning on NG for quite some time for the electric grid, but there's no guarantee that the oil companies are going to be happy with NG being only marginally profitable. The infrastructure is still expensive to maintain, and despite 'assurances' today that they will be able to remain profitable I don't think that outlook is completely guaranteed.

I'm not necessarily arguing in support of NG here (although there isn't really a more financially viable alternative at the moment for many parts of North America). I'm just saying that I think it's quite likely that NG pricing can remain competitive with electricity pricing. Particularly because it seems likely to me that electrical rates increase moving forward (say over the next 10-15 years) rather than decrease. Trying to predict the price of either power source over a lengthy timeline seems perilous to me, unless of course you can control your own energy costs by being as independent as you can from the energy grids.

I agree with you there - and that's why if OP is in the market right now it's a tough calculus. A NG furnace installed today will probably be cheaper to operate over its life, but one installed in 10 years might not necessarily be able to make that same claim.

The only reason I'd have any confidence in predicting the future of NG to be bleak is the mounting societal desire to see carbon consumption be priced accordingly, but then that's assuming that the world remains stable and predictable which I guess could make me foolish for doing so.

I think it's pretty clear that natural gas will eventually be impacted by what economists call "cost disease".  But I'd be surprised if it really starts to happen before 2030ish.

Essentially, natural gas has a ton of fixed costs along the entire value chain.  Big pipelines, safety inspections, property leases, debt, drilling costs etc.  All of these costs have to get paid even if the volume of gas sold starts to fall.  This will start driving up the price of gas significantly. 

Conversely, the competing technologies like heat pumps are only marginally more complex than a traditional AC.  The reason they cost so much more is that they are just  manufactured at a lower volume, and don't have the same manufacturing economies of scale.  The more demand for heat pump rises, the more the cost for them will fall.  The inflation reduction act is really going to accelerate this as well.

Eventually, the cost of natural gas will start rising faster than inflation, while the cost of competing technologies will start to fall.  While I don't know exactly when it will be, I expect it will start to accelerate when some of the big industrial users of natural gas (electricity, high-temp industrial processes, fertilizer, etc) start switching their fuel sources.  If I had to make a prediction, I'd guess this will be in the late 2020's or early 2030's.

Natural gas accounted for 40% of electric generation in the US last year so just switching to heat pumps doesn't totally insulate one from natural gas prices.   Hopefully renewables can continue to scale because natural gas is nearing $10/dek again, heating season is gonna suck for gas and electric this winter unless something changes.

I'm sure utilities are different, but electricity has always been much less volatile than gas prices everywhere I've lived.  I can think of a few reasons why this is:

1. Utilities have a mix of power sources and have opportunities to change their supply mix based on market prices.  I know some places fired up more coal in 2021 when gas prices went crazy.
2. While consumers are exposed to the spot prices of natural gas, I understand power plants utilize long-term contracts.  So their prices get locked in for the long term in a way consumer prices don't.  Utilities also should be hedging their commodity prices to some degree, which they won't do for consumers.  This is part of the EU's problem, as they typically don't use long term contracts on that side of the pond.
3.The other 60% of generation keeps prices steadier than they would be for a single commodity.

I believe electricity is much more inflation resistant than natural gas.  In particular, renewables growth won't necessarily drive the price of electricity down, but it will make the price much more stable.  A solar field or a wind farm is financed and will have costs locked in for 30 years.  Those will mostly operate on long term contracts that aren't really impacted by the broader commodities markets.  You won't find that level of certainty with any fuel you're pulling out of the ground.

This is part of the reason that I got a heat pump in the first place.  Within a few years I'll have my gas line shut off, have an EV, and have a big enough solar system that I can tell the commodities markets to fuck off almost entirely.

[Abe]

I’d be very interested in how the heat pump goes in the winter. We are thinking of installing one just because last time the gas system failed here (the great Texas freeze), we had nothing but chopped wood in a fireplace. Now we have a backup space heater + solar panels and batteries, but a heat pump would be more efficient.

[BudgetSlasher]

I’d be very interested in how the heat pump goes in the winter. We are thinking of installing one just because last time the gas system failed here (the great Texas freeze), we had nothing but chopped wood in a fireplace. Now we have a backup space heater + solar panels and batteries, but a heat pump would be more efficient.

I do not have specific dollar values, but I can tell you ours cost less than heating oil, our only options are electric; fuel oil; or propane, to run through last winter in Maine. And that was before the current run up in heating oil prices and the ones that are forecast for the coming winter.

We do have a pellet insert that we run when we are home/in the evening, but not when we are away or over night; we also did that when relying on fuel oil for forced hot air. Once the heat pumps went online Dec 1 2021, the fuel oil was never used again and we saw overnight temps into the double digit negatives in *F.

[big_owl]

-Natural gas may be very cheap now but there's no guarantee that it will be in 5, 10, or 15 years. Between infrastructure improvements and uncertainty around future climate related legislation, there's a very real chance that natural gas will rise to be on par with electric.

It's also entirely possible that because NG is tied to petroleum production, that it's price could fall with demand as we increasingly lean on electricity for our energy needs. Fewer NG appliances, fewer ICE vehicles, etc should all reduce demand/prices of NG while the opposite seems likely to happen with electricity prices as demand continues to increase and investments in renewables are made.

The only sure way to predict future energy prices is to be as independent as possible with your energy production.

I mean, will it though? Oil companies have been avoiding domestic capex, especially ever since the oil inversion we saw back in 2020. I don't think we're going to get federal incentives for the consumer to keep natural gas, and progressive states are already mandating the reduction or elimination of NG in new builds where possible. I can see a scenario where NG remains absurdly cheap for a few years, and incentives for new residential installs will continue to hook people into NG only to see rates steadily rise to shore up the loss in profit from fuel production.

My utility offers a program where if you agree to (and demonstrate) install a new NG furnace, they'll completely waive/reimburse (depending on the situation) the meter installation and connection. Un-waived, a new meter is over $5k to install.

They know that as long as natural gas $/ccf is within the ballpark of electric, that people won't think about switching to a heat pump anytime soon lest they bear the cost of installing a heat pump.

We're going to be leaning on NG for quite some time for the electric grid, but there's no guarantee that the oil companies are going to be happy with NG being only marginally profitable. The infrastructure is still expensive to maintain, and despite 'assurances' today that they will be able to remain profitable I don't think that outlook is completely guaranteed.

I'm not necessarily arguing in support of NG here (although there isn't really a more financially viable alternative at the moment for many parts of North America). I'm just saying that I think it's quite likely that NG pricing can remain competitive with electricity pricing. Particularly because it seems likely to me that electrical rates increase moving forward (say over the next 10-15 years) rather than decrease. Trying to predict the price of either power source over a lengthy timeline seems perilous to me, unless of course you can control your own energy costs by being as independent as you can from the energy grids.

I agree with you there - and that's why if OP is in the market right now it's a tough calculus. A NG furnace installed today will probably be cheaper to operate over its life, but one installed in 10 years might not necessarily be able to make that same claim.

The only reason I'd have any confidence in predicting the future of NG to be bleak is the mounting societal desire to see carbon consumption be priced accordingly, but then that's assuming that the world remains stable and predictable which I guess could make me foolish for doing so.

I think it's pretty clear that natural gas will eventually be impacted by what economists call "cost disease".  But I'd be surprised if it really starts to happen before 2030ish.

Essentially, natural gas has a ton of fixed costs along the entire value chain.  Big pipelines, safety inspections, property leases, debt, drilling costs etc.  All of these costs have to get paid even if the volume of gas sold starts to fall.  This will start driving up the price of gas significantly. 

Conversely, the competing technologies like heat pumps are only marginally more complex than a traditional AC.  The reason they cost so much more is that they are just  manufactured at a lower volume, and don't have the same manufacturing economies of scale.  The more demand for heat pump rises, the more the cost for them will fall.  The inflation reduction act is really going to accelerate this as well.

Eventually, the cost of natural gas will start rising faster than inflation, while the cost of competing technologies will start to fall.  While I don't know exactly when it will be, I expect it will start to accelerate when some of the big industrial users of natural gas (electricity, high-temp industrial processes, fertilizer, etc) start switching their fuel sources.  If I had to make a prediction, I'd guess this will be in the late 2020's or early 2030's.

Natural gas accounted for 40% of electric generation in the US last year so just switching to heat pumps doesn't totally insulate one from natural gas prices.   Hopefully renewables can continue to scale because natural gas is nearing $10/dek again, heating season is gonna suck for gas and electric this winter unless something changes.

I'm sure utilities are different, but electricity has always been much less volatile than gas prices everywhere I've lived.  I can think of a few reasons why this is:

1. Utilities have a mix of power sources and have opportunities to change their supply mix based on market prices.  I know some places fired up more coal in 2021 when gas prices went crazy.
2. While consumers are exposed to the spot prices of natural gas, I understand power plants utilize long-term contracts.  So their prices get locked in for the long term in a way consumer prices don't.  Utilities also should be hedging their commodity prices to some degree, which they won't do for consumers.  This is part of the EU's problem, as they typically don't use long term contracts on that side of the pond.
3.The other 60% of generation keeps prices steadier than they would be for a single commodity.

I believe electricity is much more inflation resistant than natural gas.  In particular, renewables growth won't necessarily drive the price of electricity down, but it will make the price much more stable.  A solar field or a wind farm is financed and will have costs locked in for 30 years.  Those will mostly operate on long term contracts that aren't really impacted by the broader commodities markets.  You won't find that level of certainty with any fuel you're pulling out of the ground.

This is part of the reason that I got a heat pump in the first place.  Within a few years I'll have my gas line shut off, have an EV, and have a big enough solar system that I can tell the commodities markets to fuck off almost entirely.

Electricity costs are up substantially.scross the board this year and will continue to float.uowards as.long as gas stays expensive

https://www.eia.gov/electricity/monthly/epm_table_grapher.php?t=table_5_06_b

There is certainly a smoothing function in kwh prices but the longer gas stays high the more that will trend toward international levels because of our extensive exports.  The consumer was dealt a reprieve this summer due to the explosion at the Freeport export facility.  That will be over soon and again there will be upward pressure to international levels.  We already have two price hikes in the pipeline for our users.  But we're selling gas overseas hand over fist making a ton of money with two expansions under FEED right now. 

[Syonyk]

I live in Idaho and have read/told that gas is so cheap here that it doesn't make sense to switch to any electric appliances (HVAC, water heater, etc).

Which power company?  But, yes, Idaho power rates are pretty darn low.  However, they're also a lot more stable than gas rates, as mentioned.

If you're going to get off gas, you really need to go all the way, so you can get rid of the basic gas delivery charge - if you only have a small amount of gas demand, your basic delivery fee is going to dominate costs (back in Iowa some years back, it was $20/mo before a single molecule of gas passed the meter, but I don't have gas out here so I'm not sure how the rate schedules work, sorry).  That would be a heat pump, heat pump water heater, electric stove... and possibly some significant electrical service upgrades, or at least new wires being run, depending on what your house is set up for.  You might also get a break on home insurance if you no longer have NG to the property.

You can, however, consider going with a "dual fuel" setup, that would use a heat pump in the shoulder seasons when it's not that cold out, but still keep the NG furnace for deep winter heat.  We heat out here (southwest of Boise) on a heat pump, and it's fine, though it's a bit prone to ice up on the foggy inversion days.  The backup coils are more likely to be on in those conditions, but still not much.  However, my options are electric or propane, so I've never sat down to compare the NG costs as it's not an option here.

Note, I do NOT have any solar panels. I'm interested in it, but haven't jumped in yet.

Do you have enough land for a ground mount?  And are you capable of doing the work yourself for a ground mount array?  If so, I've got some increasingly well tested plans (at least down in the Treasure Valley area) for some A-frames that should work fairly well with a post-net-metering world.  It's not a trivial amount of work, by far, but I did mine for about $1.30/W before incentives, and the second revision is closer to $1/W.

[NaN]

I am trying to make a similar decision but I have to replace my furnace with a combo handler as my house does not already have AC.

My climate has 95% of its lows in January/February below 25 F, which makes me worried for a heat pump.

Ideally I would like to move to a heat pump, electric water heater, and induction stove, removing gas completely. However, I was reading that my 200 amp service is probably not enough to handle the new electrical load. Well, caveat I have a gas tankless water heater with a recirculation line that is so amazing. The tankless electric water heaters draw a lot of watts!

[BudgetSlasher]

I am trying to make a similar decision but I have to replace my furnace with a combo handler as my house does not already have AC.

My climate has 95% of its lows in January/February below 25 F, which makes me worried for a heat pump.

Ideally I would like to move to a heat pump, electric water heater, and induction stove, removing gas completely. However, I was reading that my 200 amp service is probably not enough to handle the new electrical load. Well, caveat I have a gas tankless water heater with a recirculation line that is so amazing. The tankless electric water heaters draw a lot of watts!

Based on my experience in a colder climate of being an all eclectic -including vehicle- house in a colder climate how you would need more than 200 amps in practice; then I googled and saw 28,000 watts for a tankless electric water heater. That's a good chunk of the 38,400 watt 80% sustained limit for 200 amps and still more than half of the full 40,000 a 200 amp can peak to.

You could consider a heat pump/hybrid water heater as opposed to a tankless electric; we have an 80 gallon one and are quite happy with it.

[Syonyk]

Ideally I would like to move to a heat pump, electric water heater, and induction stove, removing gas completely. However, I was reading that my 200 amp service is probably not enough to handle the new electrical load. Well, caveat I have a gas tankless water heater with a recirculation line that is so amazing. The tankless electric water heaters draw a lot of watts!

Replace the tankless heater with a heat pump water heater and you're fine on 200A.  More than fine, really.

Tankless heaters are tolerable on gas, and are idiotic on electric.  They'll use most of a house's peak power capacity for one appliance, that has no need to be that grid-abusive in the slightest.

[NorCal]

Ideally I would like to move to a heat pump, electric water heater, and induction stove, removing gas completely. However, I was reading that my 200 amp service is probably not enough to handle the new electrical load. Well, caveat I have a gas tankless water heater with a recirculation line that is so amazing. The tankless electric water heaters draw a lot of watts!

Replace the tankless heater with a heat pump water heater and you're fine on 200A.  More than fine, really.

Tankless heaters are tolerable on gas, and are idiotic on electric.  They'll use most of a house's peak power capacity for one appliance, that has no need to be that grid-abusive in the slightest.

Can confirm electric tankless is dumb. Heat pump water heaters typically use a 30A breaker, although some new ones hit the market that use a 120V/15A breaker.

I watch mine with a home energy monitor, and 95% of the time it draws less than 2A. It just kicks on 20A of resistive back up elements on rare occasions when 3+ people are showering back-to-back.

[bacchi]

Ideally I would like to move to a heat pump, electric water heater, and induction stove, removing gas completely. However, I was reading that my 200 amp service is probably not enough to handle the new electrical load. Well, caveat I have a gas tankless water heater with a recirculation line that is so amazing. The tankless electric water heaters draw a lot of watts!

Replace the tankless heater with a heat pump water heater and you're fine on 200A.  More than fine, really.

Tankless heaters are tolerable on gas, and are idiotic on electric.  They'll use most of a house's peak power capacity for one appliance, that has no need to be that grid-abusive in the slightest.

Can confirm electric tankless is dumb. Heat pump water heaters typically use a 30A breaker, although some new ones hit the market that use a 120V/15A breaker.

I watch mine with a home energy monitor, and 95% of the time it draws less than 2A. It just kicks on 20A of resistive back up elements on rare occasions when 3+ people are showering back-to-back.

Rheem sells a 240v/15a version too. You can special order that or buy the 240v/30a version and swap out the elements, which is what I did.

[index]

It really depends on where you are. Generally 1 btu produced by gas is going to be cheaper than 1 btu produced by a heat pump. Especially the colder it gets.

If having snow is rare, a heat pump is a good option, if below zero is a regular occurrence a heat pump is going to be horribly expensive.

Source: Me, just installed a heat pump (in addition to a gas furnace) and I am not happy with its performance at all.

Heat pumps have performance curves you can look up in the manufacturer literature. Heat pumps are rated with a Coefficient of Performance (COP) at a specific outside temperature. COP measures the kW of heating (or cooling) provided for each kW of energy used. More specifically, heat pumps (and air conditioners) move heat from one location to another. So a COP of 3.5 means the heat pump is moving 3.5 kW of heat from the outdoors into the house for each 1 kW consumed. As the outdoor temperature drops, there is less heat available outdoors and the COP decreases.

You can calculate your breakeven point using this formula:



Then reference the COP chart, graph, or table for your unit. Example:



So for gas a 0.80 a Therm and electricity at 10c a kilowatt - the breakeven COP is 2.93. For the heat pump shown above, COPs are in excess of 2.9 at 30F and above which means the heat pump is more efficient than the furnace in this range.

The spec sheet for the Mr. Cool Universal Series everyone has been talking about on this forum is here:

https://mrcool.com/wp-content/dox_repo/mc-uni-perf-ss-en-01.pdf

Multiply HSPF by 0.293 to get COP. Spoiler alert. The 3 ton and larger Mr. Cool universal systems are not fantastic. 


See this blog:

https://www.daikinapplied.com/news/blogs/changeover-cop-calculating-the-value-of-electrification

[Ripple4]

I have a 20SEER Mini split and an 80%AFUE furnace on NG. Last winter I was in contract at $0.33/CCF and the 20SEER unit was just a little lower cost over the heating season, I saved ~$100 over 7 months. I have daily data. The reason the savings were not huge was I was conservative about how I used the heat pump and $0.33/CCF is cheaper than market over than time span. It was only set to ~68F and the NG furnace was set to 64F. This winter I'm in contract at $0.76. you can bet I'm going to run that little heat pump at 100% capacity 74F+ on the heat pump 24/7 and 55F on the NG furnace. I have an ECM motor in my NG furnace, so I run it in circulation mode to move air, without heating or cooling.

does not matter where you are, henry hub prices are king. Europe is buying USA CNG as fast as it can be made.

[index]

I have a 20SEER Mini split and an 80%AFUE furnace on NG. Last winter I was in contract at $0.33/CCF and the 20SEER unit was just a little lower cost over the heating season, I saved ~$100 over 7 months. I have daily data. The reason the savings were not huge was I was conservative about how I used the heat pump and $0.33/CCF is cheaper than market over than time span. It was only set to ~68F and the NG furnace was set to 64F. This winter I'm in contract at $0.76. you can bet I'm going to run that little heat pump at 100% capacity 74F+ on the heat pump 24/7 and 55F on the NG furnace. I have an ECM motor in my NG furnace, so I run it in circulation mode to move air, without heating or cooling.

does not matter where you are, henry hub prices are king. Europe is buying USA CNG as fast as it can be made.

A quirk with mini splits is because they have an inverter condenser, they do not run at full speed the entire time. The SEER rating is calculated over time. At peak 100% output, your mini-split is not operating at a peak COP/SEER. At 100% output the mini-split is probably operating around 13-14 SEER, at 25% output it might be operating at 30 SEER. It seems strange, but in most cases it is more energy efficient to set a mini-split at a specific temperature and leave it than turning it on and off and running it full speed.

[volleyballer]

I really want to throw a Mr Cool universal heat pump on top of my 90% efficient natural gas furnace and run a dual fuel setup. I actually started a thread here a month or so ago, I would love to somehow diy the install ($5k in materials) and cash in on the NY state and now federal rebates / credits to make it almost free to me. NY rebates require a NY certified ashp installer and designer. The new federal rebates / credits are TBD in how to obtain.

[index]

I really want to throw a Mr Cool universal heat pump on top of my 90% efficient natural gas furnace and run a dual fuel setup. I actually started a thread here a month or so ago, I would love to somehow diy the install ($5k in materials) and cash in on the NY state and now federal rebates / credits to make it almost free to me. NY rebates require a NY certified ashp installer and designer. The new federal rebates / credits are TBD in how to obtain.

You are probably going to be SOL getting rebates on a DIY as even the new federal tax credit will be administered by the state. Most states require professional installation courtesy of your HVAC lobby. The new federal credits require income less than 80% of the state median for the full credit and up to 150% of the median for a 50% tax credit. After 150%, you are not eligible for the credit. So for NY you need to be under 53k/27k household/personal for the full tax credit and 100k/51k for the 50% tax credit. 

[ak907]

Love to see this being discussed.

I would love to move away from Natural Gas entirely, for global environmental reasons, and interior air quality/health reasons. I also see the crossover coming soon, where gas becomes more expensive, particularly as other have mentioned with the fixed monthly delivery surcharge. We recently got rid of our gas stove, which leaves us with our boiler, water heater and dryer. The water heater is 21 years old and will need replacing soon. The dryer is fine-ish so far, but probably dates back to ~1970. It does seem to probably be pretty inefficient based on the smell outside when it is running.


I assume everyone here has seen the heat pump videos from Technology Connections on Youtube? If not, check them out, very nice introduction, including explanation of how heat pumps can be more energy/cost efficient even when running on dirty (coal/gas) power grids.


  What units are folks looking at? I would guess most folks are looking at air-to-air heat pumps, either for central forced air, or using mini-splits.


  My situation is weird, much more common in Europe. My heating comes from a NG fired boiler via radiators. Cooling is done via central air ducts, BUT the duct layout is not able to handle heating (lots of vents upstairs, very few down). Re-venting for heating would probably require multiple zones, more mechanical (for which there is no room) and more ducts (for which there is possibly not enough room, HVAC salespeople walked away from the idea).
   Because of the above my ideal would be a system that can provide heat via air-to-water and cooling via air-to-air. In addition it makes the most sense to me to have the system also provide the Domestic Hot Water (DHT) rather than running a separate heat pump water heater (better use of space and energy).
  The best out there actually available for purchase that I can find in the US for my unique needs is the stuff from Arctic Heat pumps. They have this cool diagram on using the heat pump to heat home with water, cool with forced air, and heat domestic hot water (https://cdn-fdbpa.nitrocdn.com/gKOxVeMEjzbIXyXQDzDOXkUdVDxCjtsJ/assets/static/optimized/rev-4896416/images/2022/01/26/h-a-w2-v2.jpg). Unfortunately their temperatures look like they are too low to effectively heat using radiators.

  Noise is something that I also see as very important due to small yards in my area. This is something I see emphasized more in European marketing, which is where all the good air-to-water heat pump action seems to be happening as well. Probably due to greater use of radiators with so many old buildings. A good example is the Daikin Altherma (https://thenaturalenergycompany.co.uk/Daikin-Altherma-high-temperature-heat-pump-Scotland/) high temperature heat pump, which looks incredibly good, but I have not found any way to get such here in the US. I had heard they were going to start importing this year but I have seen no evidence of it. It looks like Mitsubishi has one, but perhaps only targeted for commercial use (https://www.mhi.com/products/industry/heat_pump.html).

  The biggest blocker by far is the lack of education. We have talked to 4 different HVAC companies so far, they all seem to believe the weather in the DC area is just too cold for a heat pump, which is laughable.

[ak907]

I see a lot on mini-splits. Including folks using Mr Cool stuff which does look nice with the prefilled lines and such great prices!

I struggle with the idea of them for whole home heating and cooling for several reasons.
  Noise, I have always hated the noise from the head units. New ones are pretty quiet, practically silent, but I am skeptical the are engineered to stay that way over the course of a decade or two.
  Maintenance, with central air, you have one place to go to clean coils and replace air filter. With split head the maintenance intervals in the manuals are crazy. Often stating a need to clean the filter every two weeks, and clear/clean condensate lines every month. With older segmented homes, that can be a ton of work with conceivably 6-8 heads.
  Install, with and older brick home with a shared wall the route available to route the many different lines for heads are limited and a good bit of work. I particularly am concerned about the condensate lines, the holes for them, where to drain them, the condensate buildup on the outside of the lines unless properly insulated.
  Looks, with lower ceilings and smaller rooms the heads can feel pretty intrusive. There are cassette style that can be put in ceilings, but that is really tough to do in existing construction, particularly with wonky old building standards.

[index]

I see a lot on mini-splits. Including folks using Mr Cool stuff which does look nice with the prefilled lines and such great prices!

I struggle with the idea of them for whole home heating and cooling for several reasons.
  Noise, I have always hated the noise from the head units. New ones are pretty quiet, practically silent, but I am skeptical the are engineered to stay that way over the course of a decade or two.
  Maintenance, with central air, you have one place to go to clean coils and replace air filter. With split head the maintenance intervals in the manuals are crazy. Often stating a need to clean the filter every two weeks, and clear/clean condensate lines every month. With older segmented homes, that can be a ton of work with conceivably 6-8 heads.
  Install, with and older brick home with a shared wall the route available to route the many different lines for heads are limited and a good bit of work. I particularly am concerned about the condensate lines, the holes for them, where to drain them, the condensate buildup on the outside of the lines unless properly insulated.
  Looks, with lower ceilings and smaller rooms the heads can feel pretty intrusive. There are cassette style that can be put in ceilings, but that is really tough to do in existing construction, particularly with wonky old building standards.

Slim ducted mini split units solve most of those problems. We have one in our attic with supplies going to three bedrooms and a bathroom. Each bedroom has a return and filter. We could have had a central return in the hall, but we opted for multiple returns and filters so bedrooms could be closed at night.

The slim ducted units are Bout 9 inches tall so the can be installed in the top of closets or a  false hallway ceiling. The install isn't cheap though and probably beyond most people's diy skills.

[NorCal]

I see a lot on mini-splits. Including folks using Mr Cool stuff which does look nice with the prefilled lines and such great prices!

I struggle with the idea of them for whole home heating and cooling for several reasons.
  Noise, I have always hated the noise from the head units. New ones are pretty quiet, practically silent, but I am skeptical the are engineered to stay that way over the course of a decade or two.
  Maintenance, with central air, you have one place to go to clean coils and replace air filter. With split head the maintenance intervals in the manuals are crazy. Often stating a need to clean the filter every two weeks, and clear/clean condensate lines every month. With older segmented homes, that can be a ton of work with conceivably 6-8 heads.
  Install, with and older brick home with a shared wall the route available to route the many different lines for heads are limited and a good bit of work. I particularly am concerned about the condensate lines, the holes for them, where to drain them, the condensate buildup on the outside of the lines unless properly insulated.
  Looks, with lower ceilings and smaller rooms the heads can feel pretty intrusive. There are cassette style that can be put in ceilings, but that is really tough to do in existing construction, particularly with wonky old building standards.

I don't know about the Mr Cool units, but my new Mitsubishi heat pump system has a ducted air handler, and two ceiling cassettes in our upstairs.  Essentially, we needed the system to hit a certain SEER rating to qualify for the $9,000 Denver rebates, and added the ceiling cassette's to hit that efficiency rating.  We went with the ceiling units over wall heads due to the ideal location being near my kids bunk beds.  My kids would have used the wall heads as a climbing structure with disastrous results.

These were clearly a pain to install, and the installers hated them.  But they are the quietest HVAC system I've ever had.  They make about the same amount of noise as our ceiling fan.  The outdoor unit is also amazingly quiet.  You can only tell its running if you're standing right next to it or are watching the fans spin.  Our old AC could be heard from multiple houses down the street.

After watching this Mitsubishi unit being installed, I'm sorta skeptical of whether the DIY kits are worth it.  The Mitsubishi system is much more complex and would be impossible to DIY.  It has the complex computer controllers, connections, and proprietary interfaces that make DIY work nearly impossible.  All of the motors are variable speed, and it always runs the air handler at a low speed to ensure air circulation throughout the house.  But it is ridiculously efficient (SEER 20) and quiet in ways that I don't think the DIY kits will ever match.  I'm happy with the end result more than I would be with a Mr Cool kit.  And I usually hate the quality of work that contractors do.

There is certainly a market and a use case for DIY.  But I'm a pretty DIY type person, and I'm still glad I paid professionals for this one.  I would consider a DIY kit if I were to ever add a mini split to my garage/workshop though.

[index]

Heat pumps are going to save a lot of money in the shoulder heating seasons when temperatures are in the 40s and 50s. They can be 2-4x as efficient as gas furnaces heating at these temperatures. Decent heat pumps are on par with furnaces between 25 and 35 degrees and furnace efficiency starts wining out below this range. Cheaper heat pumps will lock out below around 30 and you are left with emergency heat strips (essentially a big blow drier) which costs about 3x+ what a gas furnace costs to run. Good heat pumps (inverter units) have COP values of around 2.0 all the way down to 0  to -5F. They still cost roughly 30% more to run than a gas furnace for the same BTU output at these temperatures. Heat pumps also loose capacity as it gets colder, your 3 ton (36k BTU) heat pump may only be making 20K BTUs when it is 0F outside. If you need 30k BTU to keep the house at temperature, the shortfall will come from gas or electric heat strip auxiliary (emergency) heat. 

The gas furnace versus heat pump questions comes down to electric costs, gas costs (monthly connection fee), and climate.



If you are in zone 1-3 you can get by with a cheap heat pump. Zone 4 probably want to go with a higher quality heat pump that won't lock out and maintains capacity in the teens, Zone 5 you want a high quality heat pump and costs are going to be roughly the same between a furnace and heat pump (if you stay all electric) as you will spend some time on expensive auxiliary heat. Zone 6 and 7 are going to save some money with a heat pump but need gas backup. 

[bacchi]

The gas furnace versus heat pump questions comes down to electric costs, gas costs (monthly connection fee), and climate.

We're seeing that equation shift to heat pumps because of high gas costs. I'm paying $1.1/ccf and it'll only go up through the spring.

Fwiw, my Daikin model doesn't even have backup strips.

[NorCal]

Heat pumps are going to save a lot of money in the shoulder heating seasons when temperatures are in the 40s and 50s. They can be 2-4x as efficient as gas furnaces heating at these temperatures. Decent heat pumps are on par with furnaces between 25 and 35 degrees and furnace efficiency starts wining out below this range. Cheaper heat pumps will lock out below around 30 and you are left with emergency heat strips (essentially a big blow drier) which costs about 3x+ what a gas furnace costs to run. Good heat pumps (inverter units) have COP values of around 2.0 all the way down to 0  to -5F. They still cost roughly 30% more to run than a gas furnace for the same BTU output at these temperatures. Heat pumps also loose capacity as it gets colder, your 3 ton (36k BTU) heat pump may only be making 20K BTUs when it is 0F outside. If you need 30k BTU to keep the house at temperature, the shortfall will come from gas or electric heat strip auxiliary (emergency) heat. 

The gas furnace versus heat pump questions comes down to electric costs, gas costs (monthly connection fee), and climate.



If you are in zone 1-3 you can get by with a cheap heat pump. Zone 4 probably want to go with a higher quality heat pump that won't lock out and maintains capacity in the teens, Zone 5 you want a high quality heat pump and costs are going to be roughly the same between a furnace and heat pump (if you stay all electric) as you will spend some time on expensive auxiliary heat. Zone 6 and 7 are going to save some money with a heat pump but need gas backup.

I'm in Denver (zone 5 on that map).  The heat pump I just had installed is a higher end Mitsubishi unit, with no resistive backup elements.  While I haven't had it for a winter yet, here's my assumptions:

1. The installer estimated about 3,000 kWh/yr for heating.  I estimate about 1,100kWh/yr for cooling, which is a combination of the heat pump and a whole house fan.  So that's a combined $650 annual for heating & cooling.  I had the whole house fan installed this year as well, so I can't fully disentangle the savings from that and the heat pump.

2. My prior system used about 500kWh/yr on the gas furnace air handler, 1,850kWh/yr on AC, and 375 therms of natural gas.  So that's about $375 in electrical and and $375 in gas at our billing rates for a total price of $750/yr.

Essentially, we'll be paying about the same amount for electrical heating as with natural gas, but since it's a higher efficiency unit, we'll be saving money on the cooling side. 

So while it saves a little money, it's not a great financial investment. 

Our utility publishes their carbon intensity of electricity at 1.032lbs per kWh, and it's falling rapidly.  Natural gas creates 11.7lbs of emissions per therm.  So my new system creates about 4,200lbs of emissions per year.  And this will fall rapidly as Colorado shuts down coal plants over the next few years (or I add solar).  My old system created 6,800 lbs of emissions per year, and that natural gas would never get cleaner than it is today.  So switching to a heat pump will cut my HVAC emissions by 38% in year one, with much greater emissions savings in later years.

So yes, saving money is important.  But climate change will never be solved if we only take on projects that maximize ROI.  This is true at both the individual and societal level.

[Ripple4]

I have a 20SEER Mini split and an 80%AFUE furnace on NG. Last winter I was in contract at $0.33/CCF and the 20SEER unit was just a little lower cost over the heating season, I saved ~$100 over 7 months. I have daily data. The reason the savings were not huge was I was conservative about how I used the heat pump and $0.33/CCF is cheaper than market over than time span. It was only set to ~68F and the NG furnace was set to 64F. This winter I'm in contract at $0.76. you can bet I'm going to run that little heat pump at 100% capacity 74F+ on the heat pump 24/7 and 55F on the NG furnace. I have an ECM motor in my NG furnace, so I run it in circulation mode to move air, without heating or cooling.

does not matter where you are, henry hub prices are king. Europe is buying USA CNG as fast as it can be made.

A quirk with mini splits is because they have an inverter condenser, they do not run at full speed the entire time. The SEER rating is calculated over time. At peak 100% output, your mini-split is not operating at a peak COP/SEER. At 100% output the mini-split is probably operating around 13-14 SEER, at 25% output it might be operating at 30 SEER. It seems strange, but in most cases it is more energy efficient to set a mini-split at a specific temperature and leave it than turning it on and off and running it full speed.

interesting thought, can you provide a source for this? my research indicates that as long as the compressor is not cycling from very low cooling loads, the efficiency is within 10% of name plate rating between <50% and 100%. though it does taper off a little at 100% load, its not even close to a 30% reduction as stated.

https://www.greenbuildingadvisor.com/question/visualizing-mini-split-performance-data


also my 12kbtu machine seems to need the indoor wall mounted unit plastic filter cleaned every 3 months, but as stated I run the furnace circulator fan with a high (13-16) MERV media filter, so that gets most of the chunks. on the outside unit I loosly installed a aluminum mesh door screen over the HEX and that catches the cotton weed seeds and other flyers, making it easy to vacuum out.

[NorCal]

I have a 20SEER Mini split and an 80%AFUE furnace on NG. Last winter I was in contract at $0.33/CCF and the 20SEER unit was just a little lower cost over the heating season, I saved ~$100 over 7 months. I have daily data. The reason the savings were not huge was I was conservative about how I used the heat pump and $0.33/CCF is cheaper than market over than time span. It was only set to ~68F and the NG furnace was set to 64F. This winter I'm in contract at $0.76. you can bet I'm going to run that little heat pump at 100% capacity 74F+ on the heat pump 24/7 and 55F on the NG furnace. I have an ECM motor in my NG furnace, so I run it in circulation mode to move air, without heating or cooling.

does not matter where you are, henry hub prices are king. Europe is buying USA CNG as fast as it can be made.

A quirk with mini splits is because they have an inverter condenser, they do not run at full speed the entire time. The SEER rating is calculated over time. At peak 100% output, your mini-split is not operating at a peak COP/SEER. At 100% output the mini-split is probably operating around 13-14 SEER, at 25% output it might be operating at 30 SEER. It seems strange, but in most cases it is more energy efficient to set a mini-split at a specific temperature and leave it than turning it on and off and running it full speed.

interesting thought, can you provide a source for this? my research indicates that as long as the compressor is not cycling from very low cooling loads, the efficiency is within 10% of name plate rating between <50% and 100%. though it does taper off a little at 100% load, its not even close to a 30% reduction as stated.

https://www.greenbuildingadvisor.com/question/visualizing-mini-split-performance-data


also my 12kbtu machine seems to need the indoor wall mounted unit plastic filter cleaned every 3 months, but as stated I run the furnace circulator fan with a high (13-16) MERV media filter, so that gets most of the chunks. on the outside unit I loosly installed a aluminum mesh door screen over the HEX and that catches the cotton weed seeds and other flyers, making it easy to vacuum out.

Here's an added datapoint.  The two attached pictures are from my home energy monitor. 

The first picture is the energy usage profile of my old AC.  It would turn on, draw about 4,500W, then turn off a few hours later.

The second picture is the start-up energy profile of the heat pump.  It ramps up over about 15 minutes, and then ramps down a bit.  It mostly just hums along drawing about 1,000W for most of the day.  But it ramps power up and down based on how the house is warming throughout the day.  When it gets cool enough the fan/air handlers stay on to circulate air, even if the compressor turns off.  It'll ramp up to about a 3,500W draw if I turn on the air handler and both mini-split heads at the same time.

My anecdotal observations as well as discussions with the installer is that it is generally better to just set a temperature and leave it rather than cycle the thermostat up and down like you would with a traditional AC.  Although I'm now in the season where I turn it off at night, open windows, and use some fans.

[big_owl]

Fwiw I own a trane 20XVi which is a very expensive inverter unit.  It's miles ahead of anything I've owned before.  Basically silent and like the above poster it'll run all day long at a very low speed if you just set the temp and leave it.  The air sort of just leaks out of the registers and the only way you know it's running is to stick your hand in the vent or use a temp gun to measure the vents.  And of the 5 heat pumps I've owned so far it's the only one where the air coming out of the ducts is warm like gas heat even on a single digit snowy day. 

Given the choice I'd still take natural gas baseboard water heating like I had in Michigan growing up, but this is basically the next best thing. 

[index]

I have a 20SEER Mini split and an 80%AFUE furnace on NG. Last winter I was in contract at $0.33/CCF and the 20SEER unit was just a little lower cost over the heating season, I saved ~$100 over 7 months. I have daily data. The reason the savings were not huge was I was conservative about how I used the heat pump and $0.33/CCF is cheaper than market over than time span. It was only set to ~68F and the NG furnace was set to 64F. This winter I'm in contract at $0.76. you can bet I'm going to run that little heat pump at 100% capacity 74F+ on the heat pump 24/7 and 55F on the NG furnace. I have an ECM motor in my NG furnace, so I run it in circulation mode to move air, without heating or cooling.

does not matter where you are, henry hub prices are king. Europe is buying USA CNG as fast as it can be made.

A quirk with mini splits is because they have an inverter condenser, they do not run at full speed the entire time. The SEER rating is calculated over time. At peak 100% output, your mini-split is not operating at a peak COP/SEER. At 100% output the mini-split is probably operating around 13-14 SEER, at 25% output it might be operating at 30 SEER. It seems strange, but in most cases it is more energy efficient to set a mini-split at a specific temperature and leave it than turning it on and off and running it full speed.

interesting thought, can you provide a source for this? my research indicates that as long as the compressor is not cycling from very low cooling loads, the efficiency is within 10% of name plate rating between <50% and 100%. though it does taper off a little at 100% load, its not even close to a 30% reduction as stated.

https://www.greenbuildingadvisor.com/question/visualizing-mini-split-performance-data


also my 12kbtu machine seems to need the indoor wall mounted unit plastic filter cleaned every 3 months, but as stated I run the furnace circulator fan with a high (13-16) MERV media filter, so that gets most of the chunks. on the outside unit I loosly installed a aluminum mesh door screen over the HEX and that catches the cotton weed seeds and other flyers, making it easy to vacuum out.

I was eyeballing off cop charts. The article linked shows the same behavior I'm describing:



At max load the unit is running between maybe 65% and 80% of its stated COP (efficiency).

[BudgetSlasher]

If your house is large enough to require multiple heat pump inside units -MMM face punches aside- where a single gas system would heat the whole house, you may see some saving by being able to zone the house and have different temperatures.

[Sibley]

I'm very interested in heat pumps. Luckily, I don't have to replace now, but I'm starting to pay attention to this space because I know its coming. My furnace and AC are older, and while they're running I'm seeing parts fail due to age. Regular maintenance is staying ahead of it for now but it's just a matter of time. I'm mentally estimating probably in the next 1-3 years I'll be replacing ahead of a mid-season failure.

Realistically, this timing works in my favor. Heat pump tech has come a long way in the past 20 years, I'm hoping that there will continue to be improvements that will make winter temps less and less of a hurdle. Every advance that helps those in zones 6 and 7 will also mean me in zone 5 has better options. I'm also hoping that heat pumps will become more common in my area, so it's easier to find a company to install and do maintenance/repair. Plus, hopefully supply chain issues will be worked out.

My biggest concern is the temperature extremes. Yeah, it can handle 90F and 20F. But I do sometimes get 105F and -20F, so while I acknowledge that those temps will be a struggle, can it operate without shutting down? If it's -20 outside I don't expect it to be 75 inside, but can I keep it at 60? It's those situations where I'm hoping that another year or 2 will help me.

[big_owl]

If your house is large enough to require multiple heat pump inside units -MMM face punches aside- where a single gas system would heat the whole house, you may see some saving by being able to zone the house and have different temperatures.

One of the benefits of having multiple units is when one goes bad, which they always do eventually, you can rely on the other one until you get it fixed. 

[NorCal]

I'm very interested in heat pumps. Luckily, I don't have to replace now, but I'm starting to pay attention to this space because I know its coming. My furnace and AC are older, and while they're running I'm seeing parts fail due to age. Regular maintenance is staying ahead of it for now but it's just a matter of time. I'm mentally estimating probably in the next 1-3 years I'll be replacing ahead of a mid-season failure.

Realistically, this timing works in my favor. Heat pump tech has come a long way in the past 20 years, I'm hoping that there will continue to be improvements that will make winter temps less and less of a hurdle. Every advance that helps those in zones 6 and 7 will also mean me in zone 5 has better options. I'm also hoping that heat pumps will become more common in my area, so it's easier to find a company to install and do maintenance/repair. Plus, hopefully supply chain issues will be worked out.

My biggest concern is the temperature extremes. Yeah, it can handle 90F and 20F. But I do sometimes get 105F and -20F, so while I acknowledge that those temps will be a struggle, can it operate without shutting down? If it's -20 outside I don't expect it to be 75 inside, but can I keep it at 60? It's those situations where I'm hoping that another year or 2 will help me.

My one recommendation is to get the process started before something fails.  Heat pumps are caught up in the supply chain shortages.  While I don't know the exact causes, I suspect there's really high demand in Europe right now, and these things have a lot more computer controlled components than their standard AC counterparts (particularly the high-efficiency variable speed ones).

In addition, you need to find the rare contractors that know these systems.  I don't know the other brands, but I watched the installation of my Mitsubishi unit.  And while it's conceptually similar to a standard AC, there was clearly a lot of proprietary knowledge that went into it.  Everything from higher pressure levels to different quantities of refrigerant to proprietary wireless thermostat controllers.  I knew it would be different, but I didn't appreciate how different it was until I saw it installed.

In my case, I signed an installation contract in mid-April, which got it installed in mid-July.  So this isn't something you're going to do the day your furnace or AC goes out. 

[Sibley]

I'm very interested in heat pumps. Luckily, I don't have to replace now, but I'm starting to pay attention to this space because I know its coming. My furnace and AC are older, and while they're running I'm seeing parts fail due to age. Regular maintenance is staying ahead of it for now but it's just a matter of time. I'm mentally estimating probably in the next 1-3 years I'll be replacing ahead of a mid-season failure.

Realistically, this timing works in my favor. Heat pump tech has come a long way in the past 20 years, I'm hoping that there will continue to be improvements that will make winter temps less and less of a hurdle. Every advance that helps those in zones 6 and 7 will also mean me in zone 5 has better options. I'm also hoping that heat pumps will become more common in my area, so it's easier to find a company to install and do maintenance/repair. Plus, hopefully supply chain issues will be worked out.

My biggest concern is the temperature extremes. Yeah, it can handle 90F and 20F. But I do sometimes get 105F and -20F, so while I acknowledge that those temps will be a struggle, can it operate without shutting down? If it's -20 outside I don't expect it to be 75 inside, but can I keep it at 60? It's those situations where I'm hoping that another year or 2 will help me.

My one recommendation is to get the process started before something fails.  Heat pumps are caught up in the supply chain shortages.  While I don't know the exact causes, I suspect there's really high demand in Europe right now, and these things have a lot more computer controlled components than their standard AC counterparts (particularly the high-efficiency variable speed ones).

In addition, you need to find the rare contractors that know these systems.  I don't know the other brands, but I watched the installation of my Mitsubishi unit.  And while it's conceptually similar to a standard AC, there was clearly a lot of proprietary knowledge that went into it.  Everything from higher pressure levels to different quantities of refrigerant to proprietary wireless thermostat controllers.  I knew it would be different, but I didn't appreciate how different it was until I saw it installed.

In my case, I signed an installation contract in mid-April, which got it installed in mid-July.  So this isn't something you're going to do the day your furnace or AC goes out.

Yeah, I figured it would be a longer lead time. I plan to ask the maintenance tech this fall what timing he would estimate, based on age and condition. I've got a new control board, new blower motor, etc, so it's not all original. I also need to do some research about duct work, because mine is not the best. Probably something I'll look into this winter and make some decisions.

[index]

I'm very interested in heat pumps. Luckily, I don't have to replace now, but I'm starting to pay attention to this space because I know its coming. My furnace and AC are older, and while they're running I'm seeing parts fail due to age. Regular maintenance is staying ahead of it for now but it's just a matter of time. I'm mentally estimating probably in the next 1-3 years I'll be replacing ahead of a mid-season failure.

Realistically, this timing works in my favor. Heat pump tech has come a long way in the past 20 years, I'm hoping that there will continue to be improvements that will make winter temps less and less of a hurdle. Every advance that helps those in zones 6 and 7 will also mean me in zone 5 has better options. I'm also hoping that heat pumps will become more common in my area, so it's easier to find a company to install and do maintenance/repair. Plus, hopefully supply chain issues will be worked out.

My biggest concern is the temperature extremes. Yeah, it can handle 90F and 20F. But I do sometimes get 105F and -20F, so while I acknowledge that those temps will be a struggle, can it operate without shutting down? If it's -20 outside I don't expect it to be 75 inside, but can I keep it at 60? It's those situations where I'm hoping that another year or 2 will help me.

My one recommendation is to get the process started before something fails.  Heat pumps are caught up in the supply chain shortages.  While I don't know the exact causes, I suspect there's really high demand in Europe right now, and these things have a lot more computer controlled components than their standard AC counterparts (particularly the high-efficiency variable speed ones).

In addition, you need to find the rare contractors that know these systems.  I don't know the other brands, but I watched the installation of my Mitsubishi unit.  And while it's conceptually similar to a standard AC, there was clearly a lot of proprietary knowledge that went into it.  Everything from higher pressure levels to different quantities of refrigerant to proprietary wireless thermostat controllers.  I knew it would be different, but I didn't appreciate how different it was until I saw it installed.

In my case, I signed an installation contract in mid-April, which got it installed in mid-July.  So this isn't something you're going to do the day your furnace or AC goes out.

Yeah, I figured it would be a longer lead time. I plan to ask the maintenance tech this fall what timing he would estimate, based on age and condition. I've got a new control board, new blower motor, etc, so it's not all original. I also need to do some research about duct work, because mine is not the best. Probably something I'll look into this winter and make some decisions.

@NorCal has some good advice. HVAC companies stick with the suppliers (brands) they know and are slow to change. If you are going to DIY or find and installer to install something new (to them) you are going to need to figure out what your requirements are. Engineers use a Manual J calculation and the 99% heating temperature when designing a system:

https://codes.iccsafe.org/content/ICC3102020P1/appendix-a-normative-design-temperature-limits-by-state-and-county-and-u-s-territory

Arguably better than Manual J is keeping track of your current system run time using a smart thermostat. Take something like an ecobee and see what your actual usage was over the worst 12 hour period in the passed few years. Look at your current furnace capacity and efficiency. If it is a 80% efficient 80k btu model and it ran 8 hours to keep your home warm during the worst cold snap in the passed few years - you need a heat pump capable of producing 512 BTU over 12 hours - or 43k BTU. The problem you run into in northern climates is you have to oversize the heat pump for the winter leading to short cycling (inefficient and poor humidity control) during the summer. The other problem you get into is say you get a 4 ton (48K BTU) Trane XV20i like @big_owl when you live in Chicago. Its a great heat pump but only produces about 60% of its nameplate capacity at 4F so you are only getting 29k BTU when you need 43k. You still need backup heat.     


Your plan to wait two years might pay off. I know a few years ago Gree (who makes the Mr. Cool Universal unit alot of people talk about) came out with their Flexx air handler (identical to the Mr. Cool). Since then Mitsubishi, Fijitsu, Daiken, and Midea have come out with similar units. Mitsubishi makes mini split units for Trane, Midea makes units for Carrier/Bryant, Gree makes units for Lennox, and Daiken makes units for Goodman so its a good bet the rebadged Chinese/Japanese units will be picked up by HVAC companies in the near future.   
 

[NorCal]

I'm very interested in heat pumps. Luckily, I don't have to replace now, but I'm starting to pay attention to this space because I know its coming. My furnace and AC are older, and while they're running I'm seeing parts fail due to age. Regular maintenance is staying ahead of it for now but it's just a matter of time. I'm mentally estimating probably in the next 1-3 years I'll be replacing ahead of a mid-season failure.

Realistically, this timing works in my favor. Heat pump tech has come a long way in the past 20 years, I'm hoping that there will continue to be improvements that will make winter temps less and less of a hurdle. Every advance that helps those in zones 6 and 7 will also mean me in zone 5 has better options. I'm also hoping that heat pumps will become more common in my area, so it's easier to find a company to install and do maintenance/repair. Plus, hopefully supply chain issues will be worked out.

My biggest concern is the temperature extremes. Yeah, it can handle 90F and 20F. But I do sometimes get 105F and -20F, so while I acknowledge that those temps will be a struggle, can it operate without shutting down? If it's -20 outside I don't expect it to be 75 inside, but can I keep it at 60? It's those situations where I'm hoping that another year or 2 will help me.

My one recommendation is to get the process started before something fails.  Heat pumps are caught up in the supply chain shortages.  While I don't know the exact causes, I suspect there's really high demand in Europe right now, and these things have a lot more computer controlled components than their standard AC counterparts (particularly the high-efficiency variable speed ones).

In addition, you need to find the rare contractors that know these systems.  I don't know the other brands, but I watched the installation of my Mitsubishi unit.  And while it's conceptually similar to a standard AC, there was clearly a lot of proprietary knowledge that went into it.  Everything from higher pressure levels to different quantities of refrigerant to proprietary wireless thermostat controllers.  I knew it would be different, but I didn't appreciate how different it was until I saw it installed.

In my case, I signed an installation contract in mid-April, which got it installed in mid-July.  So this isn't something you're going to do the day your furnace or AC goes out.

Yeah, I figured it would be a longer lead time. I plan to ask the maintenance tech this fall what timing he would estimate, based on age and condition. I've got a new control board, new blower motor, etc, so it's not all original. I also need to do some research about duct work, because mine is not the best. Probably something I'll look into this winter and make some decisions.

@NorCal has some good advice. HVAC companies stick with the suppliers (brands) they know and are slow to change. If you are going to DIY or find and installer to install something new (to them) you are going to need to figure out what your requirements are. Engineers use a Manual J calculation and the 99% heating temperature when designing a system:

https://codes.iccsafe.org/content/ICC3102020P1/appendix-a-normative-design-temperature-limits-by-state-and-county-and-u-s-territory

Arguably better than Manual J is keeping track of your current system run time using a smart thermostat. Take something like an ecobee and see what your actual usage was over the worst 12 hour period in the passed few years. Look at your current furnace capacity and efficiency. If it is a 80% efficient 80k btu model and it ran 8 hours to keep your home warm during the worst cold snap in the passed few years - you need a heat pump capable of producing 512 BTU over 12 hours - or 43k BTU. The problem you run into in northern climates is you have to oversize the heat pump for the winter leading to short cycling (inefficient and poor humidity control) during the summer. The other problem you get into is say you get a 4 ton (48K BTU) Trane XV20i like @big_owl when you live in Chicago. Its a great heat pump but only produces about 60% of its nameplate capacity at 4F so you are only getting 29k BTU when you need 43k. You still need backup heat.     


Your plan to wait two years might pay off. I know a few years ago Gree (who makes the Mr. Cool Universal unit alot of people talk about) came out with their Flexx air handler (identical to the Mr. Cool). Since then Mitsubishi, Fijitsu, Daiken, and Midea have come out with similar units. Mitsubishi makes mini split units for Trane, Midea makes units for Carrier/Bryant, Gree makes units for Lennox, and Daiken makes units for Goodman so its a good bet the rebadged Chinese/Japanese units will be picked up by HVAC companies in the near future.   
 

One feature I didn't appreciate beforehand was the value of a variable speed unit.  It's one of those things I didn't know I wanted, but I'm extremely happy with.  My old AC was clearly oversized, and this fixes some of the issues that caused.

I used to have a 5-10 degree temperature difference between my main floor and upstairs in the summer.  The new air handler that runs at whatever speed it feels like has narrowed that to a 2-5 degree difference.

I can also see the difference in energy efficiency.  Even in the worst heat wave, this thing usually just draws about 1,000W (which is only about 25% of the old AC).  Sometimes a bit more, sometimes a bit less.  But with the 50amp breaker they put it on, I fully expect it to pull up to 9,600W on a super cold morning.  It only uses the energy it needs at the time.

I highly recommend variable speed.

[NaN]

Ideally I would like to move to a heat pump, electric water heater, and induction stove, removing gas completely. However, I was reading that my 200 amp service is probably not enough to handle the new electrical load. Well, caveat I have a gas tankless water heater with a recirculation line that is so amazing. The tankless electric water heaters draw a lot of watts!

Replace the tankless heater with a heat pump water heater and you're fine on 200A.  More than fine, really.

Tankless heaters are tolerable on gas, and are idiotic on electric.  They'll use most of a house's peak power capacity for one appliance, that has no need to be that grid-abusive in the slightest.

Thanks - appreciate that comment. I have never analyzed our hot water usage but it would probably be just fine with a tank version. We could still hook up a recirculation pump for the instant hot water. It is good to look at them now before finishing my utility room remodel from last year.

You can calculate your breakeven point using this formula:

Thanks for posting this!

[NorCal]

Thanks - appreciate that comment. I have never analyzed our hot water usage but it would probably be just fine with a tank version. We could still hook up a recirculation pump for the instant hot water. It is good to look at them now before finishing my utility room remodel from last year.

Be careful with those recirculation pumps.  I found the recirculation pump in my house was running more frequently than it should, and that alone neary doubled my hot water heater energy usage.  It was costing me hundreds of dollars a year.

In fact, finding out the inefficiency of this pump is the trigger to me actually caring about and optimizing my home energy usage.

I recommend either forgoing the re-circulation pump, or making sure it's an "on demand" type of system.  I've heard good things about the Taco system (link below).  In my case, I put my recirculator on a smart plug and control it using a Flic switch.  The Flic switch triggers an Alexa routine that runs the recirculation pump for 10 minutes at a time.  It works great, saves water, and saves a ton of energy.

https://www.tacocomfort.com/product/smartplus-hot-water-recirculation/
https://flic.io/shop/flic2-starter-kit

As for the hot water heater itself, I go back to my heat-pump hot water heater recommendation.  The only exception would be if your water heater is adjacent to your main living space, as they do make noise.  They also won't work if you use it with an always-on recirculation system.  They're fine with the on-demand systems.

Switching to a heat-pump water heater has been my highest ROI energy saving project.  Here's the math on mine:

Gas water heater: Used 567 therms per year with the broken recirculator, and 283 per year after it was fixed.  It also used about $35/year in electricity for the power vent.  Gas is about $1/therm, so I'll call it $320/yr to run the hot water heater without a recirculator. 

Heat Pump Water Heater: Is on track to use about 1,200kWh/yr in electricity at $0.16/kWh for $192/yr in annual cost.  So this is saving me over $400/yr compared with my bill before the recirculation fix, and $125 compared with my bill after the fix.  And this will eventually be offset once I add solar. 

I did this as a DIY project, so my costs of $2,300 are probably much higher than you'll pay with the new incentives.  The Inflation Reduction Act has a $1,750 credit for heat pump water heaters, and my utility offers an $800 credit.  I'd guess you could probably get it fully installed for under $1,000, with additional savings if you're capable of DIYing the electrical. 

[NorCal]

If your house is large enough to require multiple heat pump inside units -MMM face punches aside- where a single gas system would heat the whole house, you may see some saving by being able to zone the house and have different temperatures.

One of the benefits of having multiple units is when one goes bad, which they always do eventually, you can rely on the other one until you get it fixed.

The history & reality of this is a bit different.  I was originally planning to either zone my house, or add smart vents in order to fix a temperature imbalance in my upstairs.  It's pretty impossible to cool the upstairs in the summer.

When I had the heat-pump installed, it turned out I needed a minor efficiency boost to qualify for the $9,000 rebate.  They could do this by adding a wall head or a ceiling cassette.  Adding the ceiling cassette's upstairs cost about as much as zoning the system, so it seemed like a win.  Zoning would have made more sense if the rebate wasn't at stake.

They do cool the upstairs bedrooms much more efficiently than trying to do it with the main air handler. 

It's not redundant though.  The ceiling cassettes are run from the same outdoor heat pump and refrigerant loop as the main air handler.  So I'm still SOL if the outside unit fails or there's a refrigerant leak.  I believe that outdoor unit could power as many as 8x mini-split units.

[TomTX]

I’d be very interested in how the heat pump goes in the winter. We are thinking of installing one just because last time the gas system failed here (the great Texas freeze), we had nothing but chopped wood in a fireplace. Now we have a backup space heater + solar panels and batteries, but a heat pump would be more efficient.

A quality heat pump designed for cold temperatures will stay pretty darn efficient even as temperatures drop. Here's one working fine in a North Dakota winter at -24F, without falling back to resistance heating. The poster worried about +25F temperatures just needs to ensure they get a quality unit designed for the conditions.
https://www.youtube.com/watch?v=_v8vizQXwss
Many of the quality Asian minisplits such as Daikin and Mitsubishi work very well.

We're considering ditching gas entirely (as mentioned by Syonyk) - I'm paying $25/month just to be hooked up to gas.

[BudgetSlasher]

Thanks - appreciate that comment. I have never analyzed our hot water usage but it would probably be just fine with a tank version. We could still hook up a recirculation pump for the instant hot water. It is good to look at them now before finishing my utility room remodel from last year.

Be careful with those recirculation pumps.  I found the recirculation pump in my house was running more frequently than it should, and that alone neary doubled my hot water heater energy usage.  It was costing me hundreds of dollars a year.

In fact, finding out the inefficiency of this pump is the trigger to me actually caring about and optimizing my home energy usage.

I recommend either forgoing the re-circulation pump, or making sure it's an "on demand" type of system.  I've heard good things about the Taco system (link below).  In my case, I put my recirculator on a smart plug and control it using a Flic switch.  The Flic switch triggers an Alexa routine that runs the recirculation pump for 10 minutes at a time.  It works great, saves water, and saves a ton of energy.

https://www.tacocomfort.com/product/smartplus-hot-water-recirculation/
https://flic.io/shop/flic2-starter-kit

As for the hot water heater itself, I go back to my heat-pump hot water heater recommendation.  The only exception would be if your water heater is adjacent to your main living space, as they do make noise.  They also won't work if you use it with an always-on recirculation system.  They're fine with the on-demand systems.

Switching to a heat-pump water heater has been my highest ROI energy saving project.  Here's the math on mine:

Gas water heater: Used 567 therms per year with the broken recirculator, and 283 per year after it was fixed.  It also used about $35/year in electricity for the power vent.  Gas is about $1/therm, so I'll call it $320/yr to run the hot water heater without a recirculator. 

Heat Pump Water Heater: Is on track to use about 1,200kWh/yr in electricity at $0.16/kWh for $192/yr in annual cost.  So this is saving me over $400/yr compared with my bill before the recirculation fix, and $125 compared with my bill after the fix.  And this will eventually be offset once I add solar. 

I did this as a DIY project, so my costs of $2,300 are probably much higher than you'll pay with the new incentives.  The Inflation Reduction Act has a $1,750 credit for heat pump water heaters, and my utility offers an $800 credit.  I'd guess you could probably get it fully installed for under $1,000, with additional savings if you're capable of DIYing the electrical.

One consideration for heat pump water heaters in northern climates -or other heating dominated climates- they take heat from the air inside your house and when your heating system is running that is what is heating your water with the added inefficiencies of the the heat pump.

I have one in a heating dominated climate because the math still worked out as less expensive  averaged over the year.

[NaN]

The only exception would be if your water heater is adjacent to your main living space, as they do make noise. 

Yes, my hot water heater is literally 8 ft from my dining room table in my house. The Navien tankless gas hot water heater is pretty quiet.

edit: looks like they make some split hot water heater systems ( compressor outside). Might be worth it. With over 300 sunny days a year I could even add solar water heater panels.