# Heat pump vs. gas furnace and AC on Homer Electric Assn Inc rates (AK)

> **Quick answer** (updated 2026-11-10): As of November 2026, for a typical 1,800 sq ft gas-heated home on Homer Electric Assn Inc electricity rates in Alaska that needs a new furnace and AC: Replacing like-for-like with a new furnace and AC comes out ahead here even with a low heat pump quote: a high-efficiency cold-climate heat pump would cost about $710 a year more to run, not enough to cover its installed cost.

- Verdict: **like-for-like ahead at any quote**
- Heat pump yearly running cost vs. a new gas furnace and AC: $710 more
- Break-even quote gap: the heat pump wins over 15 years if its quote is at least $10,600 below the like-for-like quote
- Interactive calculator (change size, insulation, fuel, prices, ZIP): https://meterwise.app/ak/homer-electric-assn-inc/heat-pump-vs-furnace/
- Machine-readable data: https://meterwise.app/data/v1/utilities/ak/homer-electric-assn-inc.json

## Typical home: costs by option

1,800 sq ft, average insulation, heating with gas, furnace and AC both need replacing.

| Option | Installed (typical) | Installed range | Rebates | Energy per year | 15-year total |
|---|---|---|---|---|---|
| New gas furnace + new AC | $13,050 | $10,220–$15,890 | – | $1,540 | $36,200 |
| Heat pump (replaces both) | $13,050 | $9,080–$17,030 | – | $3,140 | $60,100 |
| High-efficiency cold-climate heat pump | $17,030 | $12,490–$22,700 | – | $2,250 | $50,800 |

## Inputs

- Electricity: Homer Electric Assn Inc's average residential price in AK (EIA), $0.298/kWh; the winter price of extra kWh is estimated at $0.279/kWh. Enter your own rate for a closer answer. Typical-bill price 29.8¢/kWh, +10% vs. the Alaska average of 27.1¢/kWh.
- Weather: Homer 8 Nw, 10,107 heating and 1 cooling degree days a year (NOAA 1991-2020 normals).
- Gas: $1.25/therm (Alaska winter average, EIA); propane $2.69/gallon; heating oil $6.15/gallon.
- Homes in this utility's Alaska area heat with gas 57%, heating oil 22%, other 10%, electricity 8%, propane 4% (U.S. Census Bureau ACS 2019-2023).
- Installed prices: published study ranges, scaled for home size and Alaska HVAC installer wages (BLS).
- Rebates: not yet checked in Alaska, so not included.

## Common questions

**Is a heat pump worth it for Homer Electric Assn Inc customers?**
As of November 2026, for a typical 1,800 sq ft gas-heated home on Homer Electric Assn Inc electricity rates in Alaska that needs a new furnace and AC: Replacing like-for-like with a new furnace and AC comes out ahead here even with a low heat pump quote: a high-efficiency cold-climate heat pump would cost about $710 a year more to run, not enough to cover its installed cost.

**How much does a heat pump cost to run on Homer Electric Assn Inc's rates?**
About $2,250 a year for heating and cooling with the High-efficiency cold-climate heat pump option, against $1,540 for New gas furnace + new AC.

**What electricity price does this use?**
Electricity: Homer Electric Assn Inc's average residential price in AK (EIA), $0.298/kWh; the winter price of extra kWh is estimated at $0.279/kWh. Enter your own rate for a closer answer.

## Method

Heating and cooling need from local weather, floor area and insulation; each option's efficiency (heat pumps lose
efficiency in the cold and use backup heat in cold months) turns that into kWh and fuel; electricity is priced
through the utility's tariff; installed costs come from published ranges. Full method: https://meterwise.app/about/index.md

Estimates for a typical home, not a quote or financial advice.

## Other Alaska utilities

- [Alaska Power and Telephone Co](https://meterwise.app/ak/alaska-power-and-telephone-co/heat-pump-vs-furnace/index.md)
- [Chugach Electric Assn Inc](https://meterwise.app/ak/chugach-electric-assn-inc/heat-pump-vs-furnace/index.md)
- [Golden Valley Elec Assn Inc](https://meterwise.app/ak/golden-valley-elec-assn-inc/heat-pump-vs-furnace/index.md)
- [Matanuska Electric Assn Inc](https://meterwise.app/ak/matanuska-electric-assn-inc/heat-pump-vs-furnace/index.md)
- [All Alaska utilities](https://meterwise.app/ak/index.md)

## Cite this page

MeterWise, "Heat pump vs. gas furnace and AC on Homer Electric Assn Inc rates (AK)", updated 2026-11-10, https://meterwise.app/ak/homer-electric-assn-inc/heat-pump-vs-furnace/. Data licensed CC BY 4.0.