If your home is heated by propane or heating oil, a heat pump is very likely the cheapest fuel you can switch to. Both delivered fuels are costly per unit of heat, and a heat pump multiplies each kWh of electricity into 2–3 units of heat. The result is one of the most reliable wins in home heating.
The per-BTU problem with propane and oil
Comparing fuels means looking at cost per delivered BTU — energy content, efficiency and price together:
| Fuel | Energy content | Typical price | Efficiency | Rough $/MMBTU delivered |
|---|---|---|---|---|
| Propane | 91,500 BTU/gal | ~$3.00/gal | 92% AFUE | ~$36 |
| Heating oil | 138,500 BTU/gal | ~$5.50/gal | 85% AFUE | ~$47 |
| Natural gas | 100,000 BTU/therm | ~$1.80/therm | 95% AFUE | ~$19 |
| Heat pump (COP 2.4) | — | ~$0.18/kWh | COP 2.4 | ~$22 |
Propane and oil land far above both gas and a heat pump. (Prices are illustrative residential averages; yours will differ.)
What the savings look like
For a reference 2,000 sq ft home, a heat pump typically cuts the heating energy bill 30–50% versus propane or oil. Exact numbers depend on your electricity price and climate zone — see heat pump vs propane and heat pump vs heating oil for the state-by-state spread, or your own state page.
Why this matters most in the Northeast and rural areas
Heating oil is concentrated in the Northeast, and propane in rural homes without gas mains. These are exactly the places where households pay the most to heat — and where a heat pump delivers the biggest running-cost relief, plus summer cooling. Add the 2026 rebates and the case gets stronger.
Run your numbers
Plug your propane or oil price and your electricity rate into the calculator. Because the heat pump’s advantage here is structural — not a knife-edge like it can be against cheap gas — you’ll usually see it win comfortably across a wide range of inputs.