new furnace prices and payback

The price of a new furnace varies with its efficiency (measured by their AFUE coefficient) but also with its installation costs, which often outweigh the cost of the furnace.

Yes. The installation costs can double of triple the initial cost of a furnace; but there is no way around. The quality of the installation is crucial. A poor installed furnace with a high AFUE rating can be outperformed by a well installed unit with a much lower AFUE rating.

This issue involves gas furnaces but also - even on a higher degree - the oil furnaces (new efficient oil furnaces require an well sized chimney upgrade, with a stainless steel liner).

So, be aware to the installation of your new furnace. Top furnace manufacturers insist on their own certified installers. The furnace should be properly selected and sized and the installation should be properly planned in order to fit the house and its particular heating needs.

New furnace prices

To know the efficiency of a furnace look for its AFUE - Annual Fuel Utilization Efficiency –, a percentage expressing how much gas, oil or other energy source is converted into heat: say, 80%, 90%, 97%... Most modern furnaces have an AFUE ranging between 80% and 98%, which means that 2% (in the 98% furnaces) to 20% of the heat is lost through the flue. Many older furnaces have an AFUE of 65% or less. That's why it's so difficult to get the prices for a furnace system. Listed below are just very approximate furnace prices for "average" installations.

Guideline prices for furnaces:

- 90% AFUE new gas furnace (installed): $3,000 and up
- 80% AFUE new gas furnace (installed): $2,000 and up
- 90% AFUE new oil furnace (installed): $2,000 and up
- 95% multi-stage gas furnace (installed): $4000 and up
- Wall gas furnaces: $1,500 installed.
- 90% wood pellet furnace (installed): $5,000 - $6,000

For more prices, see:
ConsumerSearch
Rinnai ES38-P Direct Vent Propane Wall Furnace, Amazon.com
Wall furnaces, Nextag

The payback

The payback of a new furnace depends on a long set of factors:

1) its installed price;
2) its AFUE (efficiency);
3) local gas/oil or other fuel prices;
4) electricity savings (new variable speed fan blower motors use a fraction of the electricity of older ones);
5) your heating bills and climate;
6) the insulation level of your home;
7) rebates and tax credits (in some states there are rebates that can change the competitiveness of the most pricey furnaces).

That's a complex set of factors that complicates the maths. But the basics aren't difficult: if, for instance, the annual savings provided by a very high efficient furnace (over a mid-efficient furnace) are $200 and the extra initial investment is $1,000 more than that of the mid-efficiency unit, the payback period will be around 4 years...

Replacing an old-outdated furnace with a high-efficiency is a typical good investment with a short payback period... if your heating bills are reasonably high.

The table below (from EnergySavers.gov) can help you to calculate the savings provided by the replacement of an old furnace with a new system; just take into account 1) your heating bills and 2) the existing system efficiency (AFUE) and 3) the efficiency of the upgraded or new system.

Savings provided by Furnaces - EERE