Furnace vs heat pump in Spokane: a 10-year cost comparison
When homeowners ask \u201cfurnace or heat pump?\u201d, they usually want a one-word answer. We don\u2019t give one, because the right answer depends on the home. But we can show you the math. Here\u2019s a 10-year cost comparison for a typical 1,800 sq ft Spokane home.
Devon R.
Tech Network Manager, NATE-certified · May 10, 2025 · 11 min read
Quick answer
In Spokane, both gas furnaces (96% AFUE) and cold-climate heat pumps work. A gas furnace has lower upfront cost ($5,800–$9,400) and reliable heat to any temperature. A cold-climate heat pump has higher upfront cost ($14,800–$19,800) but 30–55% lower operating cost, plus 30% federal tax credit and Avista rebate. Most Spokane homes are best served by a dual-fuel system: heat pump as primary, gas furnace as backup.
- Gas furnace installed cost: $5,800–$9,400.
- Cold-climate heat pump installed cost: $14,800–$19,800.
- Operating cost: heat pump 30–55% lower than gas furnace.
We modeled the 10-year cost of a 96% AFUE gas furnace vs a cold-climate heat pump for a typical 1,800 sq ft Spokane home. The results might surprise you.
The setup
1,800 sq ft South Hill bungalow, 1955 construction. Originally 80% AFUE gas furnace, no AC. Ductwork is original fiberglass flex in the basement, marginal but functional. Attic insulation upgraded to R-38 in 2018. Windows are original double-pane.
Heating load (Manual J): 36,000 BTU/hr at Spokane’s 0°F design temp.
Cooling load (Manual J): 24,000 BTU/hr at Spokane’s 91°F design temp.
Right-sized equipment: 3-ton cooling, 60,000 BTU heating.
Option A: 96% AFUE gas furnace + 15.2 SEER2 AC
Equipment: Trane S9V2 furnace (96% AFUE, two-stage) + Trane XR16 AC (15.2 SEER2, single-stage).
Installed cost: $8,200 (furnace) + $7,400 (AC) = $15,600.
Avista rebate: –$300 (high-efficiency furnace).
Federal tax credit: $0 (furnace doesn’t qualify, AC doesn’t meet 16 SEER2 threshold).
Net cost: $15,300.
Annual operating cost (heating + cooling): ~$1,180/year at current Avista rates.
10-year operating cost: ~$11,800.
Total 10-year cost: ~$27,100.
Option B: Cold-climate heat pump + AC add-on (whole-home)
Equipment: Mitsubishi Hyper-Heating air-source heat pump, 3-ton, 18 SEER2, cold-climate rated.
Installed cost: $16,400.
Avista rebate: –$1,500 (qualifying heat pump).
Federal tax credit (IRA Section 25C): –$4,920 (30% of install cost).
Net cost: $9,980.
Annual operating cost (heating + cooling): ~$720/year at current Avista rates.
10-year operating cost: ~$7,200.
Total 10-year cost: ~$17,180.
The comparison
10-year savings with heat pump: ~$9,920.
Payback period for the upgrade: ~5.5 years (heat pump net cost is $5,320 less than furnace after rebates; $460/year operating savings = 11.5 years payback on the gross equipment difference, but factoring rebates it’s faster).
What changes the math: if Avista rates change, if the home gets better insulation, if you add solar, or if the equipment lasts longer than expected, the heat pump wins even more. If natural gas prices drop significantly (unlikely long-term), the furnace wins more.
What doesn’t change the math much: equipment lifespan. Both options last 15–20 years with annual maintenance.
When the furnace still wins
Homes with very poor insulation (R-19 attic or less, original single-pane windows). The heat pump just can’t keep up on the coldest days, and backup heat strips run constantly.
Homes with 60A or 100A electrical service. Heat pump retrofits often need electrical service upgrades ($3,000–$8,000), which erases the economic advantage.
Homes where the gas bill is already low (under $80/month in winter). The marginal savings from a heat pump may not justify the install cost.
Homes in extreme microclimates. Five Mile Prairie’s elevation makes this borderline — heat pumps still work but backup heat strips run more often.
When the heat pump clearly wins
Homes with good insulation (R-38+ attic, R-13+ walls, modern windows).
Homes with 200A electrical service already.
Homes where wildfire-smoke IAQ is a real concern (heat pumps paired with MERV-13 filtration dramatically improve indoor air quality).
ADUs, additions, and homes where ductwork is impractical (ductless mini-splits).
Homes where the homeowner wants to reduce carbon footprint without sacrificing comfort.
The math favors heat pumps for most Spokane homes today. But the right answer depends on your specific home. We do the modeling as part of every install quote — no charge, no obligation. You see the numbers, you decide.