Thinking about switching to propane? You wouldn’t be alone: According to the U.S. Energy Information Administration (EIA), approximately 5 percent of American households use propane as their primary heat source. Any number of reasons, from utility incentives to your search for an alternative to your current high energy costs, may have you considering installation of a propane-fueled furnace. However, there are a number of factors to consider before making the move.


One of the first factors to consider is the availability of propane in your local area. Approximately 6,000 suppliers are available around the nation. (run by PERC, the Propane Education & Research Council) can provide a list of the propane retailers in your region who can meet your fueling needs.

Switching to propane also necessitates an investment in a storage tank. These are usually buried underground. notes that a 500-gallon tank generally is able to fuel an average four-bedroom home for a year.

Costs Comparisons

Assuming propane is available in your area, cost is likely your next consideration. How does the cost of propane rank against oil, natural gas and electricity? First, it is important to note that each of these fuels generates heat differently. One gallon of heating oil burned with 100% efficiency would generate 138,690 BTU of heat. One gallon of propane burned with perfect efficiency would generate a mere 91,333 BTUs of heat. To help homeowners determine whether propane is the most cost-effective option in their region, the EIA used to offer a Microsoft Excel spreadsheet that would compare costs across different fuels. They removed this spreadsheet from their site at some point in the 4th quarter of 2015.

Based on fuel price data from March 2018, the cost of generating 1,000,000 BTUs of heat in an 82% efficient residential furnace is as follows:

  • Natural Gas: $11.51 (up from $11.46 in March 2017)
  • Heating Oil: $27.21 (up 19% from March 2017)
  • Propane: $33.11 (up 3% from March 2017)

Based on this data, at slightly more than 1/3rd the cost of propane, natural gas is the cheapest of the three fuels.

Keep in mind, however, that prices vary over time, and that rebates and incentives are available for consumers considering the switch to propane. provides information on federal, state and local incentives. Many states offer incentives ranging from $100 to $600 for installing a propane furnace, although specific conditions vary from state to state.

A final price-point to consider: propane furnace manufacturers state that these products typically last 5 to 10 years longer than electric furnaces, meaning a longer payback on your equipment. Of course, the upfront costs of propane furnaces vary as widely as their electric-powered counterparts and higher-efficiency units will come at a higher cost. Talk to your furnace dealer about the return on your investment.


Today, central air propane furnaces are available with AFUE ratings as high as 97 percent, meaning these units can be highly efficient at converting fuel into heat. Moreover, to maximize efficiency and energy use, most propane furnaces today eliminate the need for a standing pilot light by replacing it with an electronic ignition. This allows the thermostat to turn on the burners only when fuel is required. These furnaces also are equipped with vent dampers, which close when the right temperature is reached and only reopen when heat is needed again.

New Installation versus Conversion

Since propane gas furnaces don’t need to be installed near a pipeline the way that natural gas does — propane is instead stored in tanks — these furnaces offer slightly more flexible installation than their natural gas counterparts.

In some cases, conversion kits are available for converting your natural gas furnace to one that employs propane. In order to adjust for the difference in pressure of these gases, the internal workings of the furnace must be changed using such conversion kits, which should be installed by a licensed technician. Talk to your installation technician about whether conversion is feasible and cost-effective.


Generally, propane systems require very little maintenance. As with any heating unit, it is recommended to have a qualified service technician inspect the unit once a year. Homeowners also should occasionally check the unit for obstructions in the venting system to make sure the unit can function properly.

It is important to note that propane leaks are possible and, depending on where your propane is stored, could pose a fire hazard. Since propane is denser than air, in the event of a leak the propane will sink to the lowest level of an enclosed space where it could mix with a pilot light with explosive results. However, the PERC is quick to point out that propane leaks can potentially be safer than leaks of other petroleum-based energy sources because a “rotten egg” smell is added during the manufacturing process to help homeowners quickly and easily identify a leak. If such a smell is identified, homeowners should immediately call their service technician.

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