Image credit: NAPA74/Istock

Heat pumps are lowest-cost option for heating and cooling most households, new research finds

New online calculator allows people to compare heating and cooling options in cities across Canada.

21 September 2023, OTTAWA—New research by the Canadian Climate Institute finds that heat pumps are already the lowest-cost way for most households across Canada to heat and cool their homes. 

The new report, Heat pumps pay off: Unlocking lower cost heating and cooling in Canada, examines the cost of heating and cooling options across building types in Vancouver, Edmonton, Toronto, Montréal, and Halifax. It compares the costs of different heat pump configurations against gas furnaces and air conditioning.

The research finds that heat pumps beat gas furnaces and air conditioners on cost in most cases. On average, the lifetime cost of a standard heat pump with electric backup is 13 per cent less than a gas furnace with air conditioning. This is in part driven by the high energy-efficiency of heat pumps, which are up to five times as efficient as gas furnaces, providing significant savings on energy bills.

In addition, those in the market for new heating or cooling appliances can use a new online calculator developed by the Institute ( to find out the lowest-cost option for their situation. The calculator provides detailed information that shows how heat pumps stack up against alternatives in each of the five cities modelled—both in terms of costs and emissions impact. 

Heat pumps are a vital technology for reducing climate pollution in Canada’s buildings and protecting people from extreme heat. They are highly energy efficient, run without burning fossil fuels, and double as a cooling technology, which will become increasingly important as extreme summer heat becomes more frequent.

The new report includes policy recommendations targeting barriers that are holding households back from installing a heat pump. These recommendations include maintaining existing government policies and rebates, streamlining supports for consumers, establishing maximum indoor temperature limits and cooling requirements, and requiring non-polluting, high-efficiency heating and cooling technologies in new buildings in regions where they are already cost-competitive. 


“We crunched the numbers and found that heat pumps are a lower-cost option than gas heating with air conditioning for most Canadians across the country. Heat pumps are a cost-effective way to stay warm in winter and cool in summer, all while lowering harmful emissions.” 

Sarah Miller, Research Lead on Adaptation, Canadian Climate Institute

“Heat pumps offer a lower-cost way to heat and cool most  homes in Canada—beating out gas and air conditioning dollar-for-dollar. Canada has an incredible opportunity to help people save on energy bills, reduce climate pollution, and provide life-saving cooling in extreme heat like we saw this summer.”

Rick Smith, President, Canadian Climate Institute 

“This new report and online calculator provide a detailed and very useful picture of how heat pumps compare to other heating and cooling systems across Canada. Installers and manufacturers are well-placed to accelerate uptake so that more households benefit from low-cost heating and cooling that reduces emissions and protects against extreme heat. ” 

Martin Luymes, Vice President of Government and Stakeholder Relations, The Heating, Refrigeration and Air Conditioning Institute of Canada


Catharine Tunnacliffe
Communications Director
Canadian Climate Institute
(226) 212-9883