The household
An owner-occupied three-flat in Chicago, IL — roughly 2,000 square feet of conditioned space across the unit being modeled, sized for a 3-ton system. The building is in ComEd territory, where residential electricity runs close to 24¢/kWh, among the higher rates in the Midwest. The existing HVAC is a standard-efficiency (80% AFUE) gas furnace paired with a 14.3 SEER2 AC condenser, both original to a prior renovation and due for replacement.
The systems
The comparison pits a 3-ton NEEP-listed cold-climate ducted heat pump (16 SEER2 / 8.5 HSPF2, installed around $13,000) against replacing the furnace and AC in kind with a similarly sized standard-efficiency gas furnace and 14.3 SEER2 condenser (installed around $9,800). The heat pump carries roughly 95% of the heating load on its own compressor, with electric-resistance backup covering the remaining 5% below its balance point — Chicago's winters are cold enough that even a cold-climate unit needs some assist.
The 10-year math
Over a 10-year horizon, install cost, heating energy, cooling energy, and maintenance are compared side by side. Illinois natural gas is cheap — about $1.48/therm — which keeps the furnace's heating bill low even at 80% AFUE.
| Cost category | Cold-Climate Heat Pump | Gas Furnace + AC |
|---|---|---|
| Equipment + install | $13,000 | $9,800 |
| Heating energy (10 yr) | $27,334 | $15,633 |
| Cooling energy (10 yr) | $5,428 | $6,074 |
| Maintenance (10 yr) | $1,750 | $2,250 |
| 10-year total | $47,513 | $33,757 |
The heat pump's higher upfront cost — nearly $3,200 more than the furnace — never gets paid back, because Illinois gas is cheap enough that the furnace's operating cost stays lower every single year.
The verdict
The gas furnace saves an estimated $13,756 over 10 years. Two things drive this outcome: ComEd's residential electricity rate (23.85¢/kWh) is high enough that even a cold-climate heat pump's efficiency gains don't overcome it, and cold-climate equipment carries a real cost premium (roughly $6,950 more installed than a standard ducted heat pump) that this specific matchup doesn't have to pay for. Illinois natural gas at $1.48/therm is simply a hard baseline to beat on pure operating cost.
What could change this
A $13,756 gap is real, but it isn't unbridgeable. A federal or Illinois-specific heat pump rebate (see the Incentives page for what's currently available) would close a meaningful share of the install-cost gap. A time-of-use or off-peak ComEd rate plan could lower the heat pump's effective electricity cost meaningfully. And if the existing furnace needs a full duct replacement anyway, the install-cost gap between the two options narrows.
Run it with your own numbers
These figures use representative home sizing and each state's EIA-reported energy prices as of August 2026 — see the methodology page for the full model. To see how your actual square footage, equipment, and utility rate change the outcome, run the Heat Pump vs. Traditional HVAC calculator with your own ZIP code.