Lowering Your Energy Bills: Are Heat Pumps a Cost-Effective Solution?

Table of Contents

• Are Heat Pumps Cost Effective?
• What Is the Average Cost of Running a Heat Pump per Hour?
• Is It Cheaper To Leave a Heat Pump on All Day?
• How Does the Cost of Heat Pumps Compare to Oil Heating?
• Save Money With a Heat Pump

If you are looking for a way to reduce your energy bills, buying a heat pump should be at the top of your list, as long as you understand the cost related to its installation. In terms of efficiency, nothing beats a heat pump, making it a cost-effective and eco-friendly way to keep your home comfortable all year long.

Are Heat Pumps Cost Effective?

Someone trying to save on their energy bill might wonder if heat pumps really are cost-effective. Even if the initial cost of a heat pump can be relatively expensive, a heat pump remains a highly cost-effective solution.

They’re versatile; they can be used year-round to cool and warm your home. You might need an additional heating system for extremely cold days, but the unit can still be used on regular winter days. You also won’t need an air conditioner for hot summer days, as your heat pump also does the job of an AC.

Heat pumps are much more efficient in energy consumption than other traditional HVAC systems, significantly impacting your bills. Over your heat pump’s lifetime, you can easily save several thousand dollars in heating bills.

It’s also important to know that government initiatives exist to encourage people to switch to heat pumps. These rebates can help you install a heat pump at a much lower cost.

What Is the Average Cost of Running a Heat Pump per Hour?

Several factors come into play to determine how much it costs to run a heat pump. The hourly cost to run a heat pump will vary depending on the size of your home, the type of heat pump you choose, and its power. Of course, the local energy cost will significantly influence your bill.

So, how much does it cost to run a heat pump? Well, for a typical single house built in 1980 in Montreal, a cold-climate heat pump paired with a backup electric heating system will cost around $1,910 annually, equivalent to $0.21/hour if it runs all year.

For a standard heat pump, still paired with an electric backup, the annual price is a bit higher at $2,100, with an approximate hourly rate of $0.24/hour.

A standard heat pump with a gas backup will have a similar result to a standard heat pump paired with an electric backup. However, gas and oil heating systems are gradually banned all over the province. Even as a backup, fossil fuels hurt the environment.

For townhouses built in 2023, the hourly cost of a cold-climate heat pump is around $0.15. Running a standard heat pump for a similar house costs around $0.14.

The average costs to run a heat pump, as mentioned above, include the energy price and different average fees and equipment based on a typical heat pump’s life cycle.

Is It Cheaper To Leave a Heat Pump on All Day?

Technically, you shouldn’t have to start or stop your heat pump yourself. So, is it cheaper to leave it on all day? It depends on the season and the daily temperature. It will work according to the thermostat setup.

In summer, it won’t be working all the time. Since it’s very efficient at cooling your home, the heat pump will naturally stop working once it has reached the desired temperature.

The same principle works during winter, but it’s normal for the heat pump to work more continuously when it’s colder. An additional heating source can be used as the heat pump might struggle to keep your home at the right temperature during extremely cold days. On those days, it could be more economical to heat with both your heat pump and your additional heat source. For the rest of the year, it is safe to say that the heat pump will be a cheaper option to keep your home comfortable.

How Does the Cost of Heat Pumps Compare to Oil Heating?

When comparing heat pumps vs. oil heat costs, oil heating can be quite expensive. Fossil fuels are generally bad for the environment, and their prices are unpredictable. According to Natural Resources Canada, cold climate heat pumps can reach efficiencies up to three times higher than oil furnaces.

When you live somewhere where electricity comes from a green source and the price is affordable, heat pumps become an evident choice. In terms of prices, oil heating will cost you between $2,000 and $5,500 per year in Canada. In comparison, a heat pump will cost, on average, around $2,000 for the whole year, including during summer, while it cools down your home.

The cost per BTU is also lower for heat pumps, at $29.31 per million BTU. For an oil furnace, the price would be around $36.96 per million BTU.

Also, in Quebec, oil heaters cannot be installed or replaced anymore, as the province is aiming towards greener energy-efficient heating solutions.

Save Money With a Heat Pump

Heat pumps have made a massive jump within the past ten years, with cold-climate heat pumps being effective down to -25 Celsius or even -30 Celsius.

Understanding what a heat pump costs to run can help you choose the best heating and cooling system for your home.

Are heat pumps economical? They sure are! They are highly efficient in energy, so they can help you save money on your energy bills while being eco-friendly. The key to significant savings resides in having the right unit for your home, hence the need to trust the experts! Please contact MST with any questions. Our team will happily support your search for the perfect heating system.