Furnaces
The Cost of an Electric Furnace (2025 Guide)
By Tom Moor•December 20, 2024Are you trying to decide between buying a gas or electric furnace? While gas furnaces are more commonly used due to their lower operating costs, ability to heat a home quickly, and greater efficiency in colder climates, electric furnaces can still be a good choice, especially if you live in a milder climate or don’t have access to natural gas.
If you’re considering replacing your existing electric furnace or installing one for the first time, you might be wondering about the cost of an electric furnace. In this guide, HVAC.com explains what an electric furnace is, how it differs from a gas furnace, and the key factors that influence its price.
What’s the Difference Between a Gas and Electric Furnace?
An electric furnace is a type of heating system that uses electricity to generate heat instead of burning fossil fuels such as gas or oil. During the heating process, electric resistance coils inside the furnace heat up when electricity passes through them, warming the air in the system’s ducts. This heated air is then circulated throughout your home by a blower fan.
An electric furnace relies entirely on electrical power and does not involve combustion or the use of gas, making it a clean and environmentally friendly option. It’s also relatively low maintenance, easier to install, and safer to operate compared to its gas counterpart, as there are no burners, vents, or gas lines to worry about.
Electric furnaces are commonly used in regions without harsh winters and are a popular choice in homes without access to natural gas lines. However, because electric furnaces rely on heating coils powered by electricity, they are typically more expensive to operate than natural gas (which is cheaper) on a per-heat basis.
Meanwhile, gas furnaces burn natural gas to generate heat, which is then circulated throughout the home. They tend to heat a home faster and are more efficient in terms of energy use for larger spaces, especially in colder climates. Gas furnaces usually cost more upfront, but their lower operating costs often make them a more economical choice over time.
Cost of an Electric Furnace in 2025
The cost of buying and installing an electric furnace in 2025 typically ranges from $2,500 to $7,500, depending on factors such as the furnace’s size, brand, and features. For smaller homes or those in milder climates, a more compact electric furnace may cost closer to the lower end of the range, while larger or more advanced models can push the price higher.
What Affects Electric Furnace Prices?
Several factors can affect the price of an electric furnace, including:
Heating Capacity
The size of a furnace refers to its heating capacity, not its physical dimensions, and can greatly affect the price of an electric furnace. Proper sizing is crucial to ensure your furnace operates effectively and efficiently. A furnace that’s too small will struggle to keep up with your home’s heating needs, resulting in overworked components, uneven temperatures, and higher energy bills. Meanwhile, a furnace that’s too large will turn on and off too frequently, wasting energy, reducing efficiency, and increasing wear and tear. And the biggest problem with buying the wrong size furnace is that the only real fix is replacing it with the appropriately sized unit.
BTUs (British Thermal Units) measure a furnace’s heating capacity, with higher BTU ratings indicating greater ability to heat larger homes. For example, a 100,000 BTU furnace (used for a 2,500- to 3,500-square-foot home) typically costs more than a 60,000 BTU model (1,500 to 1,800 square feet) due to its increased capacity and efficiency.
Brand and Quality
Just like the car you drive or the clothing you buy, an electric furnace’s make and model has a significant impact on the cost of an electric furnace. Well-known brands often come at a premium, but are typically long lasting, efficient, and reliable. Meanwhile, budget brands cost less upfront – which is helpful if you’re on a tight budget – but may break down or wear out faster, leading to additional costs.
Installation Complexity
Some electric furnace installs are more straightforward than others. For example, if you need significant electrical upgrades to accommodate your new furnace or the install area requires modifications, the installation cost can increase. Make sure the HVAC technician provides a detailed assessment to help you understand what factors might increase the cost of the installation.
Location
Where you live also plays a role in the cost of an electric furnace. Local factors such as electricity rates, regional labor costs, and the price of furnaces can influence both the purchase price and the installation costs.
Ductwork
Ductwork generally lasts about 10-25 years – roughly the same timeframe as an HVAC system. It’s a good idea to speak with an HVAC professional about the condition of your air ducts before you install a new electric furnace. If the ductwork is damaged or worn out, it’s probably worth replacing it. Installing new ductwork costs $1,500 to $7,000 depending on the size of your home, the type of duct materials used, and the difficulty of the installation.