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How Much Does a Gas Furnace Cost?

Natural gas in the most common heating fuel in the United States and often the most affordable. In 2011, the U.S. Department of Energy said natural gas was the lowest-cost conventional fuel source available for residential use.

When it’s time to replace your gas furnace, there are few important things to know before you start shopping. In this guide, we’ll give you some basic information on gas furnaces, including how much you can expect to pay.

Gas Furnace Efficiency

The efficiency of a gas furnace is measured by a percentage known as annual fuel utilization efficiency (AFUE). Manufacturers are required to display this percentage on their units so consumers can compare efficiencies.

Old, low-efficiency systems had ratings of around 65 percent, meaning that no more than 65 percent of the heat was used to warm the home and the rest escaped. New models are required to be much more efficient.

As of May 1, 2013, government regulations will require all gas furnaces to have an efficiency rating of at least 80 percent, which is considered mid-efficiency. A federal tax credit of $150 will continue to be available to consumers who purchase high-efficiency models, which have ratings of 90 percent to 98.5 percent.

Single-Stage vs. Double-Stage

Single-stage furnaces have a simple on/off switch that controls the heat. They’re either blasting heat at full force or not running at all.

Two-stage furnaces are a little smarter and more complex. Instead of just a basic on/off switch, two-stage furnaces have two “on” settings: high-fire and low-fire. The high-fire setting kicks on when a lot of heat is needed and low-fire kicks on when less is needed.

Cost of a Gas Furnace

The price of a gas furnace depends on the size, type, efficiency, brand and the cost of local labor for installation.

Single-stage, mid-efficiency gas furnaces usually cost anywhere from $2,000 to $3,500, while two-stage, mid-efficiency furnaces run $2,500 to $4,000. For high-efficiency models, add at least $1,000 to the price.

Despite the added cost of high-efficiency systems, you’ll save significantly on energy bills. According to Consumer Reports, today’s more-efficient gas furnaces can save about $17 for every $100 you spent on fuel with an old model. They are also less likely to need repairs, saving money in the long run.

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