Upgrading to an energy-efficient heat pump would lower heating costs for the vast majority of US homeowners. Switching to a heat pump has many other advantages too, but direct savings on your monthly utility bill are the most tangible. So the natural question for homeowners is: “How much can I expect to save?”
The answer depends on your home, your existing heating system, and where you live…but we know “it depends” isn't enough to help you decide on a major purchase. At Coral we're here to help, so we've laid out the energy savings equation that shows how and why these factors impact your potential energy savings.
Starting next month, we'll do the savings math so you don't have to, and will show homeowners a personalized estimate of their energy savings within minutes on our platform. But in the meantime, here's the 411 on the energy savings equation:
Factor 1: How big is your home?Bigger homes have bigger energy bills because heating a larger home simply requires more energy. Due to their higher baseline energy costs, larger homes will save more money from upgrading to a heat pump. The percentage of energy savings is similarly higher across home types — heat pumps are typically 3-4x more efficient than traditional heating systems — but the total dollar savings will be greater for larger homes.
Factor 2: How good is your insulation?
That amazing 3–4x improvement in energy efficiency we mentioned earlier? That goes out the window (literally!) if your home is not well insulated. Heat naturally flows from warmer to cooler areas, which means the hard-earned heat your heat pump has generated is constantly fighting to get outside. Good insulation keeps the heat from escaping, but without it, heat pumps are far less efficient.
Ask your contractor to evaluate your insulation before you install your heat pump. You may want to upgrade your insulation at the same time you install the heat pump to maximize your savings and comfort.
Factor 3: How do you heat your home today?
Heat pumps are the most energy-efficient heating system on the market, but the amount of savings homeowners can expect depends on how efficient their existing system is. Homeowners with inefficient electric furnaces, baseboard heaters, or propane and oil-based heating systems will save the most from switching to heat pumps. Those with natural gas furnaces will save less money, though most will still save from upgrading.
Factor 4: Where do you live?
Geography impacts potential energy savings in two ways: temperature and local energy costs. Modern heat pumps have been shown to perform well even in cold environments, but in extreme temperatures (e.g. below zero degrees F) heat pump efficiency and savings can decline. Savings will also be impacted by the cost of natural gas, oil, and electricity in a homeowner's local geography — savings are greatest where fossil fuel costs are high, and electricity costs are low.
The bottom line: Regardless of the size of your home, insulation rating, existing heating system, and location, the vast majority of homeowners will reduce their energy costs with a heat pump. But it's important for homeowners to understand how much they can realistically expect to save by upgrading.
For a personalized estimate and more heat pump and home electrification resources, sign-up for Coral. We're on a mission to help homeowners sustainably heat and cool their homes — and we'd love to help you too!