Propane vs Natural Gas Cost Calculator
Compare annual heating cost for propane and natural gas using your home's BTU load, local fuel prices, and furnace efficiency.
Sizing the heating side first? Run the HVAC BTU Sizing Calculator for your home's annual load, then drop that number in below.
Compare propane and natural gas annual cost
Enter your annual heat load and local prices. Results update as you type.
Natural gas saves $1,000/yr
60 MMBtu at 90% AFUE: propane $2,184, natural gas $1,000
How to use this calculator
Enter your annual heating need in million BTU per year (MMBtu/yr), your furnace's AFUE rating, and the local price you pay for each fuel. The calculator converts both fuels to delivered BTU at your furnace efficiency and then prices each at your local rate.
Tips for success
- Pull annual usage from past bills. Add up gas therms or propane gallons for one full heating cycle. Gas utilities show 12 months on every bill; propane suppliers list deliveries on your account portal.
- Use the same AFUE for both fuels. Same physical furnace runs at the same efficiency on either fuel. Comparing a high-efficiency gas furnace against a standard propane unit will tilt the result unfairly.
- Lock in propane on a fixed contract. Spot-price propane swings 30 to 50 percent year over year. Pre-buy or fixed-rate contracts smooth that out.
- Account for connection fees on natural gas. Most gas utilities charge a $10–$30 monthly meter fee that runs even in summer. The calculator covers fuel cost only.
Why natural gas is usually cheaper
Natural gas is delivered as a vapor through fixed pipelines. The utility's infrastructure cost is amortized across millions of customers, and the gas itself is sold at near wholesale plus a regulated margin. Propane is a refined byproduct that ships by rail, then truck, then a final delivery tanker, every link adds cost. As a rough rule, propane runs about 2 to 2.5 times the per-BTU cost of natural gas in markets where both are available.
When propane wins
- No gas main on your street. A utility extension can cost $2,000 to $20,000+ depending on distance. If you're rural, propane is usually the only realistic choice.
- Off-grid or seasonal cabin. Propane stores indefinitely in a sealed tank. No standby gas meter fee.
- Backup fuel for a generator. If you already maintain a propane tank for the generator, the marginal cost to add a small heater is small.
Common mistakes
- Comparing $/gallon to $/therm directly. A gallon of propane is 91,500 BTU; a therm is 100,000 BTU. Always normalize to $/MMBtu before deciding.
- Ignoring AFUE. A 96% condensing furnace burns 11 percent less fuel than an 85% standard furnace for the same heat output.
- Forgetting tank rental fees. Many propane suppliers charge $5–$15 per month for tank rental. Factor that in for a true year-over-year compare.
- Using winter-only spot prices. Propane peaks January to February. Use a 12-month blended rate or your previous year's average.
FAQ
Which is cheaper, propane or natural gas?
Natural gas is almost always cheaper per delivered BTU because it costs less per therm than the BTU equivalent in propane. Propane only wins when you have no gas line and would have to pay for an expensive utility extension. Compare your local price per therm against your propane price per gallon at 91,500 BTU/gal to see the gap for yourself.
How many BTUs are in a gallon of propane?
About 91,500 BTU per US gallon. One therm of natural gas is 100,000 BTU, so 1 gallon of propane delivers slightly less heat than 1 therm of natural gas.
What furnace efficiency should I use?
Use the AFUE (Annual Fuel Utilization Efficiency) rating from your furnace nameplate. Standard mid-efficiency models run 80 to 83 percent, condensing high-efficiency models hit 90 to 96 percent. If you do not know, 85 percent is a safe blended estimate. Same AFUE applies to both fuels in this calculator since most modern furnaces are rated similarly across propane and gas variants.
Does this include the cost of switching fuels?
No. This calculator compares operating cost only. A full conversion typically costs $1,500 to $4,000 for a furnace swap and orifice change, plus $500 to $2,500 for a gas line tap if a gas main is on your street. Take the annual savings number and divide your conversion cost by it to estimate payback in years.
Why is propane priced per gallon and gas per therm?
Propane is delivered as a liquid by tanker truck, so suppliers price by liquid volume (gallons). Natural gas is delivered as a vapor through pipelines, so utilities meter and bill by therm (100,000 BTU) or by ccf (100 cubic feet, roughly 1.03 therms). The calculator normalizes both to a price per million BTU so you can compare apples to apples.