Gas and propane: 95% AFUE (the federal minimum for most new gas furnaces) or 98%. Oil is modelled at about 85% and electric at 100%, and both ignore this choice.
💰 Total Installed Cost
📊 Annual Operating Cost
Cost Breakdown
Full Cost Table
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How to Use the Furnace Cost Calculator
Choose the fuel source, since it affects both equipment pricing and any venting or fuel supply work needed.
Choose the furnace output in BTU/hr that matches the home's heating load, ideally confirmed by a proper heat loss calculation.
Choose the code minimum or high-efficiency tier to see the cost and efficiency tradeoff. Oil and electric furnaces ignore this choice.
Click Calculate Installed Cost to see equipment cost, labour cost, total installed cost, and estimated annual operating cost.
What Drives Furnace Installed Cost
Furnace pricing breaks down into equipment cost, which scales with output size and efficiency tier, and labour cost, which depends on the installation's complexity. Fuel type affects equipment pricing directly and can also introduce fuel-specific work, like propane tank considerations or oil supply line checks, beyond the furnace itself. At 80,000 BTU/hr, a natural gas furnace at the code minimum comes to $5,900 installed in this calculator, made up of $3,800 for the equipment and $2,100 for labour including $700 of venting work.
The AFUE Efficiency Tradeoff
Annual Fuel Utilization Efficiency, or AFUE, measures what share of the fuel's energy actually becomes usable heat over a typical year. Since July 3, 2019, gas furnaces made for the Canadian market must reach 95 percent AFUE, with exceptions for through-the-wall and some replacement models, so the real choice for most homes is between the 95 percent minimum and a 98 percent unit rather than between 80 and 96. That step saves about 3 percent of the fuel, roughly $42 a year at the default 80,000 BTU/hr, 1,400 heating hours, and $0.04 per kWh of gas, against a $1,520 equipment premium, so the extra cost is mostly about features such as modulating output rather than fuel savings. Both tiers are condensing furnaces, using a secondary heat exchanger that cools the exhaust enough to condense moisture out of it.
Why Condensing Furnaces Cost More to Install
A condensing furnace's cool exhaust can't safely use a home's old metal chimney, which was designed for much hotter flue gases. Installing one typically means running new sidewall PVC or polypropylene venting along with a condensate drain, which is why this calculator adds $700 of venting work to natural gas and propane furnaces at both tiers. The change can also affect whatever else is left on the old chimney, such as a gas water heater, whose venting and combustion air supply may need attention, and the combustion air calculator is a quick way to check what the mechanical room needs.
Sizing Matters More Than Marketing
A furnace sized larger than the home actually needs doesn't heat any faster in any meaningful sense; it just cycles on and off more often, which wastes energy and adds wear to the blower and heat exchanger over time. Confirming the home's actual heat loss, rather than assuming bigger is safer, keeps both the upfront cost and the long-term operating cost in check, and the furnace sizing calculator is a good place to start.
Comparing Against Other Heating Options
If the home is also a candidate for a heat pump, either as full replacement or as a complementary hybrid system, compare the numbers here against the heat pump cost calculator and the heat pump vs furnace cost calculator. Running cost belongs in that comparison too, and Natural Resources Canada's testing found that cold-climate heat pumps cost more to run than natural gas where gas is cheap, but save money against electric baseboards and fuel oil.
Frequently Asked Questions
Based on this calculator's pricing, a natural gas furnace at the 95 percent AFUE federal minimum runs about $5,300 to $7,100 installed depending on output size, and a 98 percent unit about $6,600 to $9,100. Propane and oil furnaces cost more and electric furnaces less, so across every option the tool returns from about $3,800 to $10,500. Get a written quote before committing.
AFUE measures what percentage of fuel energy the furnace converts into usable heat over a typical year, with the rest lost through the flue. A 95 percent furnace loses about 5 percent of its fuel energy and a 98 percent furnace about 2 percent, so the difference in fuel use is only about 3 percent, roughly $42 a year at this calculator's defaults. Since July 3, 2019, gas furnaces made for the Canadian market must reach 95 percent AFUE in most cases, so 80 percent models now appear mainly in specific replacement situations and in older homes.
A condensing furnace cools the exhaust gases enough to extract extra heat, which means the exhaust temperature is too low to safely use a traditional metal chimney designed for hot flue gases. Condensing furnaces vent instead through sidewall PVC or polypropylene piping along with a condensate drain, which adds installation cost, and because 95 percent AFUE is now the minimum for most new gas furnaces, this calculator adds that venting cost to every natural gas and propane furnace.
No. An oversized furnace short-cycles, turning on and off more frequently than a properly sized unit, which wastes energy, causes uneven temperatures, and adds wear to components over time. Furnace size should match the home's actual heat loss rather than defaulting to the largest available unit for the coldest possible day.
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