Operating Cost: Heat Pump vs. Oil Furnace or Boiler
Whether a heat pump costs less to run than oil depends on the current oil price, electric rate, oil-system efficiency, and the heat pump's performance at each outdoor temperature. Those inputs change. A.J. LeBlanc Heating compares the homeowner's current rates and the proposed equipment instead of relying on a frozen statewide rule of thumb.
For a published statewide reference, see EIA New Hampshire fuel prices.
What changes the operating-cost comparison
- Delivered oil price: use the price on the homeowner's latest delivery.
- Electric rate: use the supply and delivery cost shown on the current bill.
- Oil-system efficiency: compare the existing equipment's actual condition and AFUE.
- Heat-pump performance: use the selected model's capacity and efficiency at different outdoor temperatures.
- Control strategy: the changeover setting determines when the heat pump or oil system runs.
Use current prices instead of a frozen example
Use your current delivered oil price and utility rate. For a published statewide reference, the U.S. Energy Information Administration tracks New Hampshire energy prices. For a project decision, the numbers on the homeowner's latest oil delivery and electric bill are more useful. Enter those values in our Heat Pump Cost Comparison Calculator to compare delivered-heat cost at different outdoor temperatures.
Where the crossover happens
There is no single New Hampshire crossover temperature. It moves when oil prices, electric rates, equipment efficiency, or control settings change.
How dual fuel fits an oil-heated home
A dual-fuel design pairs a cold-climate heat pump with an oil furnace or boiler. A well-designed system gives the controls the ability to use the appropriate heat source as conditions change. Whether it lowers total cost depends on the home and current rates.
Other factors that affect the real-world comparison
- Oil price volatility: NH oil prices have moved between $3.00 and $5.50+ per gallon over the past several years. Electricity rates are more stable.
- Cooling included: the heat pump provides AC in summer. If you would otherwise add or replace AC, that cost favors the heat pump.
- Annual service savings: if you transition primarily to the heat pump and use the oil only as backup, the oil burner runs many fewer hours per year. Annual oil service can sometimes be reduced to every other year.
- Rebates and incentives: the federal 25C tax credit ended December 31, 2025 and no longer applies to new installations. NHSaves utility rebates remain available for qualifying heat pump installations; ask us for current amounts.
What to do if your oil system is at end of life
If your oil furnace or boiler is past 20 years old or showing signs of major component failure, a full transition to a cold-climate heat pump (with electric resistance backup or no backup if the home is well-insulated) is worth modeling alongside the dual-fuel option. The economics depend on:
- The cost of the heat pump system you would install
- The cost (and rebate availability) of envelope improvements to reduce heat loss
- Your willingness to live without a fossil-fuel backup
Run the math for your specific home
Plug your current oil price and electric rate into our Heat Pump Cost Comparison Calculator to see cost per million BTU side-by-side at different outdoor temperatures. Update the numbers as fuel prices change to see when the crossover point shifts.
Schedule a consultation
If you are running an oil furnace or boiler and want to model what a heat pump or dual-fuel setup would actually cost to operate in your NH home, contact A.J. LeBlanc Heating or call 603-623-0412. We will run the numbers with your specific home, your current oil supplier rate, and your utility's electricity rate. Serving New Hampshire families since 1928.
Frequently Asked Questions
Is a heat pump cheaper than oil in New Hampshire?
It often can be, but not at every rate or outdoor temperature. The answer depends on the home's equipment, the heat pump's low-temperature performance, and current oil and electric prices. Use the calculator or ask us to run the project-specific comparison.
Can I keep my oil system if I add a heat pump?
Yes. This is the dual-fuel configuration. The oil furnace or boiler stays in place as backup; the heat pump becomes the primary heat source. The system switches between them automatically.
What is the crossover temperature for heat pump vs oil?
There is no single New Hampshire crossover temperature. It moves when oil prices, electric rates, equipment efficiency, or control settings change.
Will I still need to fill my oil tank if I add a heat pump?
Yes. In a dual-fuel setup, the oil system remains available as backup. How often it runs depends on the changeover setting, outdoor conditions, the home's heat loss, and the selected heat pump.
Should I replace my oil system entirely with a heat pump?
Depends on the home. For well-insulated NH homes, full electrification works. For older homes with high heat loss, the dual-fuel pairing is usually more economical and more reliable on the coldest nights.