Heating Fuel Cost Comparison (per Million BTU)
Compare the real cost of heating with natural gas, propane, heating oil, electricity, heat pumps, firewood, pellets and kerosene per million BTU of delivered heat, accounting for appliance efficiency, plus the annual cost for your heating load and the break-even price for switching fuels.
How it works
$/MMBTU delivered = price per unit ÷ (BTU per unit × efficiency) × 1,000,000; heat pump: 3,412 BTU/kWh × COP; annual cost = $/MMBTU × heating load; break-even COP = electricity $/BTU ÷ competitor $/BTU delivered
Fuels are sold in incompatible units — therms, gallons, kilowatt-hours, cords, tons — and burned at different efficiencies, so the only fair comparison is the cost of a million BTU actually delivered into the house: price per unit divided by the unit's heat content and the appliance efficiency. On that basis natural gas is usually cheapest where available, heat pumps beat resistance electricity by their coefficient of performance and often beat propane and oil, pellets and cordwood sit in the middle (with cordwood cheapest of all if you cut it yourself), and electric resistance, propane and kerosene are typically dearest. Multiplying by the home's annual heating load turns the ranking into dollars, and the difference funds — or fails to fund — a fuel switch.
Worked example
At $1.40/therm and 92% efficiency natural gas delivers heat at $15.22 per MMBTU; propane at $2.60/gal is $31.57, oil at $3.60 is $30.58, resistance electricity at $0.16/kWh $46.89, a heat pump with COP 2.8 $16.75, hardwood at $300/cord $19.48 and pellets at $320/ton $25.00. For a 60 MMBTU home that is $913 a year on gas against $2,813 on resistance heat.
Frequently asked questions
Which efficiency should I use?
The appliance's AFUE for furnaces and boilers (78–98%), the EPA rating for stoves (60–80%), HSPF ÷ 3.412 for a heat pump's seasonal COP. Old open fireplaces can be net negative — they pull heated air up the chimney.
How many MMBTU does my house use?
Take last year's fuel bills: therms × 0.1 × efficiency, gallons of oil × 0.1385 × efficiency, kWh × 0.003412. Most US homes need 40–80 MMBTU of delivered heat a year; well-insulated new homes 20–30.
Related calculators
Typical values from hearth-industry and extension sources (EPA/HPBA, NFPA 211 chimney rules, Wood Heat Organization). Appliance manuals, the local code and a certified chimney sweep or installer govern sizing, clearances and venting.